South Africa

Reserve Bank defends Ramaphosa Phala Phala ‘whitewash’

South Africa’s central bank governor defended the bank’s inconclusive findings of a yearlong investigation into whether President Cyril Ramaphosa broke the law when he kept foreign currency at his game farm that was later stolen.

The central bank’s investigators acted impartially and with integrity, Lesetja Kganyago said in Cape Town on Wednesday.

He was responding to lawmakers who labelled as a “whitewash” the bank’s findings last week that the transaction between Ramaphosa and a Sudanese businessman for 20 buffaloes was not “perfected,” and thus it couldn’t conclude there was any contravention of the Exchange Control Regulations.

Members of parliament also threatened to take the report on judicial review and argued that the central bank had been “narrow” in its scope, contributing to the view that South Africa didn’t have sufficient measures to deal with money laundering.

The Paris-based Financial Action Task Force put South Africa on its so-called grey list in February because of shortcomings in tackling illicit financial flows.

“Let me be clear here that we do not believe that what we have done has got implications for money laundering,” Kganyago said. “It might have, but we dealt with the interpretation of the law with respect to the exchange controls.”

The central bank’s probe was one of several instituted by authorities after former spy boss Arthur Fraser opened a case of money laundering, fraud and corruption against Ramaphosa last year, alleging that he sought to cover up a 2020 theft of more than $4 million from the sale of buffalo at his Phala Phala game farm.

Ramaphosa has said that $580,000 was stolen and denied breaking any laws.

Kganyago said it was not up to him to respond to why the transaction was made in cash instead of a bank guarantee or electronic transfer. That was between the buyer and the seller, and the bank’s investigators were not privy to the contract between the two parties, he said.

The governor said his institution would cooperate with all law enforcement authorities whose mandate it was to investigate criminality, something that was outside the scope of the bank.

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