29/01/2018 13:48 SAST | Updated 29/01/2018 15:13 SAST

Paul O'Sullivan Letter: Hogan Lovells' Role In The Capture Of SA

Paul O'Sullivan backs Lord Peter Hain's complaint against the firm with new evidence.

Screengrab- Wikimedia

Forensic investigator Paul O'Sullivan has written to the UK's Solicitor's Regulation Authority and implicated global multinational Hogan Lovells as a central part of the South African state capture story.

O'Sullivan and his organisation, Forensics for Justice, has sent a blockbuster document to the watchdog authority to support a complaint by Lord Peter Hain against Hogan Lovells.

The international law firm helped clear SARS executive Jonas Makwakwa of serious charges he faced for alleged money-laundering while employed at the revenue authority. He is now back at SARS as second-in-command along with his wife, Kelly-Ann Elskie. Both Makwakwa and Elskie are alleged to have been in possession of huge amounts of unexplained cash.

O'Sullivan expands the story as he reveals that the firm also acted for former police minister Nathi Nhleko and the former acting head of the Hawks, Berning Ntlemeza. He says that Hogan Lovells was therefore conflicted in its SARS action, as the Hawks were meant to be investigating Makwakwa and Elskie.

"The only logical conclusion any person of a sound mind could possibly arrive at is that (SARS commissioner Tom) Moyane intentionally chose your firm because someone at your firm confidentially agreed not to pursue the criminal investigation against Makwakwa and Elskie with any degree of diligence, knowing that nothing could come from the Hawks investigation, as this had already been hobbled," he says.

O'Sullivan says Hogan Lovells is implicated in neutering the Hawk,s because it helped lay the grounds for the ousting of the highly regarded former head of the special police unit, Anwa Dramat, as well as its well-liked bosses in Gauteng and KwaZulu-Natal, Shadrack Sibiya and Johan Booysen.

Hogan Lovells cannot claim ignorance; they cannot claim independence and certainly cannot claim innocence in this matter, simply with the production of crocodile-tear claims of innocence and the production of a glossy PDF file...

READ IN FULL: Paul O'Sullivan Letter to Hogan Lovells, London via HuffPost South Africa

Hogan Lovells and the watered-down investigation

In late 2017, evidence emerged showing that the international law firm back-pedalled on its investigation into SARS executive and alleged money-launderer Jonas Makwakwa.

In October, SARS commissioner Tom Moyane returned Jonas Makwakwa to his role as the chief officer for business and individual taxes and technology. This is a crucial position at the revenue authority – and one that makes him second in command – but Makwakwa faces an investigation into alleged money-laundering as well as a potential corruption investigation.

The terms of reference of the original investigation by Hogan Lovells, obtained by HuffPost, reveals how the law firm, with bases in the U.S. and the U.K., watered down the scope of its investigation to allow advocate Terry Motau to let Makwakwa off the hook.

Makwakwa and wife and fellow SARS staffer Elskie were found to have made suspicious cash deposits into their accounts. In addition, Makwakwa was found to have enjoyed unexplained transfers from SARS itself, and from a company that was the eventual beneficiary of a contract from the department of water affairs and sanitation.

The suspicious cash deposits into the accounts of both employees amount to millions of rands that have been branded suspicious and possibly criminal by money-laundering regulator the Financial Intelligence Centre.

'SARS needs impeccable integrity'

Speaking to HuffPost in November, former finance minister Pravin Gordhan had no kind words for the firm.

Once again a professional firm, through its questionable conduct, has raised serious questions about its professional ethics and its role in state capture.

"Is this the kind of conduct that the legal profession needs to look into? Far more serious is the fact that these events are taking place in an institution like SARS, that needs impeccable integrity and the confidence of the people," he added.

Hogan Lovells' South Africa chair Lavery Modise last week rejected accusations made by Lord Hain in the British House of Lords concerning the firm's work for SARS relating to Jonas Makwakwa, saying it has nothing to hide.

"As has been stated in my evidence to Parliament, our report does not exonerate Jonas Makwakwa and does not exonerate him from possible charges that could result from the outcome of the investigations into his tax affairs conducted by PwC as well as the criminal investigation conducted by the Hawks," he said.

"We advised SARS that if the tax and criminal investigations conducted by others revealed that an offence had been committed, SARS would need to bring disciplinary proceedings against Jonas Makwakwa.

We have never advised... on whether Jonas Makwakwa is guilty of any criminal/tax offences and have not exonerated him of any.

Modise also said he was "personally affronted" by suggestions his relationship with Tom Moyane should raise red flags:

"I first met Tom Moyane on September 15, 2016 and it was in relation to our work. I met him at two further meetings in March and June 2017. Others were always present from SARS and/or Hogan Lovells, and he left our meetings before they had ended".

READ: Hogan Lovells report: 'Sunlight Over Shadow' via HuffPost South Africa (Scribd)