Popo Molefe cleared of corruption in donation scandal from Transnet lawyers

Popo Molefe cleared of corruption in donation scandal from Transnet lawyers

Public Protector Advocate Kholeka Gcaleka has cleared former Transnet chairperson, Popo Molefe, of impropriety in a R350 000 purchase of a sponsorship package from his Charitable Foundation by Mncedisi Ndlovu & Sedumedi Attorneys (MNS Attorneys) who were already service providers to the entity in 2019.

While exonerating Transnet for not investigating the corruption allegations, Gcaleka strongly recommended that the entity set up and monitor standard operation procedures (SOP) for investigating non-executive directors in the next 120 days.

In a report released on Sunday night, Gcaleka found that there could have been no material benefit in the donation to the Popo Molefe Foundation, as MSN were already receiving instructions to do work before his appointment.

She also found no evidence to suggest the firm had an unfair advantage emanating from the relationship with the Popo Molefe Foundation.

Gcaleka said: “The allegation that Dr Popo Molefe, in his capacity as the chairperson of the Transnet Board, contravened clause 11.2.2 of the Transnet Ethics Code and/or failed to manage any actual or perceived conflict of interest, in relation to his interest in the Popo Molefe Foundation and the purchase of a sponsorship package from the Foundation in the amount of R350 000 by MNS Attorneys, a service provider to Transnet, is not substantiated.”

Neither could she find evidence suggesting that Transnet facilities in both tangible or intangible forms were used in the soliciting of the sponsorship by the Popo Molefe Foundation.

“Furthermore, there is no evidence that Dr Molefe sought to use his position or Transnet facilities to advance his private interests, or actually derived any benefit at the expense of Transnet as a result of the sponsorship made to  the Popo Molefe Foundation, or took decisions which were prejudicial to Transnet resulting therefrom," Gcaleka said.

The investigation originated from a complaint lodged with the Public Protector by the Treasurer-General of the Economic Freedom Fighters (EFF), Omphile Maotwe, through a letter in November 2020 in which she questioned whether the payment of R350 000 to the Popo Molefe Foundation by MNS Attorneys in April 2019, was in contravention of clause 11.2.2 of the Transnet Ethics Code.

Maotwe had also alleged that Transnet failed to investigate allegations of corruption against Molefe in relation to the payment.

Gcaleka found that the Transnet Ethics Code did not provide for the procedure to be undertaken for the investigation of complaints against non-executive directors, as its processes considered board members as non-employees.

The report unearthed deficiencies relating to the absence of clear procedure and process for the reporting and investigation of violations of the Transnet ethics related policies by members of the Board.

Although this had been partially addressed through the Transnet Commitment Statement, which was approved by the Transnet Board in May 2023, there was no SOP providing for a detailed procedure and process to be followed.

Transnet CEO, Michelle Phillips, earlier this month informed the Public Protector that the entity recognised the need to review and potentially amend Transnet's policies for consistency, especially regarding the SOP for complaint handling and investigations and the Anti-Fraud and Corruption Report of the Public Protector Policy.

Phillips indicated that the “No Gifts and Hospitality Policy” was also due for review in the current financial year and would be reviewed against the recommendations outlined in the report.

Gcaleka recommended that Transnet, in the next four months, facilitate the development of a procedure for the reporting and investigation of complaints against non-executive directors; and also develop the SOP dealing with the complaint handling process and investigations concerning the investigations personnel.

Transnet is tasked with reviewing the Declaration of Interest and Related Party Disclosures Policy for non-executive directors, 2021 and/or related governance instruments to require the non-executive directors and to disclose, 30 calendar days, any donations and/or sponsorships received directly, in their personal capacity, or indirectly, accruing to other private interests.

Gcaleka instructed that within 120 calendar days upon receipt of the final report, Transnet must take steps to ensure that a separate process was established and the Minister and the chairperson of Transnet, within 30 calendar days of the report, provide her with an action plan with timelines, outlining how the recommendations would be implemented.

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