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Court to decide on Trifecta appeal

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The charges relate to kickbacks that were made to unduly influence the awarding of leases to Trifecta for government offices.

Christo Scholtz and John Block. Picture: Danie van der Lith.

JUDGMENT was reserved in the Supreme Court of Appeal in Bloemfontein on Friday in the multimillion-rand Trifecta corruption case, where former ANC provincial chairperson John Block and the CEO of the Trifecta group of companies, Christo Scholtz, are trying to overturn their convictions and sentences of 15 years imprisonment.

Only Scholtz attended the court proceedings on Friday along with Block’s wife and supporters.

The accused were sentenced to 15 years imprisonment each in the Northern Cape High Court in December 2016, after they were found guilty on charges of corruption and money laundering.

National Prosecuting Authority spokesperson, Phaladi Shuping, said that the State had decided not to argue the money laundering charges in the Supreme Court of Appeal, as it constituted a “duplication of charges”.

The legal representative for Scholtz, senior advocate Marius van Zyl, called for the acquittal of his client.

Scholtz and his companies was served with a confiscation order of R60 million and fines in the region of R1.2 million.

The charges relate to kickbacks that were made to unduly influence the awarding of leases to Trifecta for government offices.

Block and his company Chisane Investments benefited from cash payments of R228 000, R500 000,
R338 521.25 and R298 151.95, renovations to his guest house in Upington to the value of R346 919.74 and ordinary shares in Trifecta Resources and Exploration (Pty) Ltd.

The application for leave to appeal in the Northern Cape High Court was granted against their convictions only and not their sentences.

The appeal court later granted Scholtz leave to appeal against his sentence.

In arguments, State advocate Peter Serunye pointed out that the sentence imposed was “in fact fair and not shockingly inappropriate”.

He submitted that the money laundering charge did not amount to the splitting of charges. “The loans, gratifications, salary payments and shares that were exchanged between the parties, constituted a gratification that were accepted as a reward owed to the corrupt relationship that existed between Scholtz, Block and the late HOD for the Department of Social Development, Yolanda Botha.”

According to Scholtz, he was not involved in identifying or purchasing the buildings, nor was he involved in any negotiations or day-to-day operations and was only an investor in the business.

Botha was mentioned in the State’s arguments as being “compromised”, where the failure to recuse herself from the adjudication of the leases was influenced by an offer of a 10 percent share in the Jyba Trust.

She also received a loan of
R1.2 million from Trifecta to renovate her house.

Serunye pointed out that her failure to advertise the leases in the government tender bulletin had eliminated competition from other service providers, so that Trifecta was guaranteed the bid.

He added that she increased the recommended lease period of various leases from five to 10 years, to promote the interests of Trifecta.

Serunye stated that following the death of the representative of the Shosholoza Trust, Sarel Breda, who was involved in a fatal plane crash in March 2009, Scholtz offered Botha a 10 percent share in the Jyba Trust, where she nominated her niece as a beneficiary.

“Scholtz knew that Botha was the HOD of the Department of Social Development with which his company was doing business with.”

It is estimated that the value of the shares amounted to between R4.5 and R5.5 million.

“It is respectfully submitted that both Scholtz and Breda realised the value of political support for their company right from the start. Thus, they ensured that they offered shares in Trifecta to politically-connected individuals like Botha and Block. No rational businessman would conduct his business on such a basis,” he added.

He argued that the so-called
R15 000 donation that was supposedly given to Botha by Trifecta for the ANC’s 98th birthday celebrations, was in fact a benefit given to Botha that was never recorded nor received by the ANC.

“It is strange that a trained bookkeeper in charge of the financial affairs of a big organisation would neglect to make a record of such a huge donation and how it was spent.”

Serunye pointed out that the presiding officer, Judge Violet Phatshoane, was “well trained and experienced”. “She did not show any predispositions or bias towards the appellants.”

Van Zyl, for the defence, stated that there was no evidence to prove that any offer or gratification had been made by Scholtz or his companies. “Prior to the commencement of the defence case the accused brought an application that the learned judge should recuse herself … on a perception of bias. The State to a large extent relied on the evidence of Trevor White, a forensic auditor who compiled a report. White did not give expert evidence but expressed opinions and made assumptions, to which the court was not bound and which were in many instances not based on proven facts.”

He stated that not a single State witness had testified that they were influenced by any of the appellants, Breda or Botha to “act in a certain manner or circumvent any prescribed procedure or to do their work in an improper manner”.

“All the witnesses called by the State that were involved in the procurement processes regarding the lease agreements, were satisfied that the provisions of the lease agreements were fair and reasonable and that due processes were followed.”

Van Zyl added that Botha had entered into two loan agreements with Trifecta when she was a member of Parliament and that she had made two re-payments of R371 000 and R40 000 to Trifecta for renovations to her house.

“In addition she paid an amount of approximately R123 000 whilst the renovations were being done for certain expenses.

“There was not a suggestion of any attempt to hide the expenses. It is not strange that journal entries were made at the end of the financial year. There were never any discussions in the context of giving a gratification, in order for Botha to secure lease agreements by the department with the Trifecta group of companies.”

Van Zyl related that Scholtz had no knowledge of the R15 000 donation to the ANC and that he only became aware of it when he received a letter of thanks.

“During cross-examination, the ANC provincial bookkeeper stated that he did not record the R15 000 in the books as it was very hectic at the time and he utilised the money immediately. The court found that it was probable that the R15 000 was not intended for the ANC coffers but for Botha and therefore the bookkeeper did not record the money because it was simply not given to him.”

He pointed out that the court was satisfied that the letter purporting to be from the ANC was manufactured to justify the cash payment that was given to Botha.

Van Zyl indicated that payments made to Block and his company Chisane Investment, were upon the request of Breda,

“All payments by the Shosholoza Trust were repaid to the Trifecta Group of Companies and all payments were arranged by Breda whether it was a loan or salary payments. All payments made by the Shosholoza Trust to Chisane Investments were loans from the Trifecta Group of Companies, which were all repaid. There was not a suggestion of evidence that the monies advanced and or paid to Chisane Investments were the proceeds of crime or that there was any agreement or attempt to conceal the payments.”

He added that Scholtz denied that he ever authorised the renovations to Block’s guest house and refused that any payments be made for that purpose.