President Jacob Zuma allegedly helped to clinch a $2-million (R13-million then) investment for his nephew’s controversial mining company, Aurora Empowerment Systems.
The claim by a director of international investment firm Global Emerging Markets (Gem) suggests that Zuma involved himself personally – despite having a clear conflict of interest given that his nephew, Khulubuse Zuma, was a director of Aurora.
The Gem director’s claim is buttressed by circumstantial evidence.
To make matters worse, Gem was led to pay the money into what appears to be a dummy account from which, according to a high court claim it filed, the cash was diverted.
There is no evidence the president or Khulubuse were involved in the claimed misappropriation.
Zuma’s alleged intervention – a July 2010 meeting that gave Gem the confidence to invest – came while Aurora was desperate to raise funds to make good on its bid to buy the Pamodzi gold mines out of liquidation.
Presidential spokesperson Mac Maharaj confirmed receiving detailed questions on Monday afternoon. By Thursday at 10am, he indicated there was no response from the presidency. (See “No. 1’s nod-and- wink meetings” below)
Aurora woos Gem & Labat
By the time of Zuma’s meeting with Gem director Chris Brown on July 11 2010, Aurora had been courting Gem for some time.
In April 2010, Zuma’s private attorney, Michael Hulley – acting on behalf of Aurora – announced that Gem had agreed in principle to advance up to R725-million to Aurora through the purchase of shares, provided the latter listed successfully on the JSE.
Aurora tried to get on to the JSE by buying Labat Africa – a small listed technology company led by former rugby administrator Brian van Rooyen. But Aurora struggled to meet the conditions set by Labat and the JSE, and the listing, through a takeover of Labat, had not occurred by July 2010.
Aurora under fire
By then, Aurora was in severe financial difficulty and was facing fierce public criticism about its interim management of the Pamodzi mines and failure to pay workers.
On July 12 2010, the online publication Moneyweb reported that Gem director Chris Brown had arrived in South Africa.
Moneyweb quoted Pamodzi liquidator Enver Motala as saying: “I have met with Chris Brown, one of the directors at Gem and he confirmed that R50-million in interim funding is to be made available.”
The news came as the remaining 100 employees keeping Aurora’s Grootvlei mine under care and maintenance were reportedly threatening to walk out because of nonpayment.
Enter President Zuma
Now it has been alleged that the day before, July 11, Brown had been treated to a face-to-face meeting with President Zuma.
In an emailed response to questions from amaBhungane, Brown confirmed meeting Zuma on the morning of the Fifa World Cup final on July 11 2010.
The New York-based businessman said Zuma “thanked” him “many times” during their meeting, which took place at the “presidential home … in Zuma’s living room”.
Brown told amaBhungane that the meeting was arranged by Khulubuse Zuma and Fazel Bhana, Aurora’s self-styled “chief strategist of mergers and acquisitions”.
No one from Aurora was present during their discussions, but according to Brown, Zuma heaped thanks on Gem for bailing out the flailing company…
South Africa Today – South Africa News
