Finance Minister Pravin Gordhan has accused South African Revenue Service (Sars) commissioner Tom Moyane of trying to cover up alleged corruption by his second-in-command, after a damning investigative report detailing millions in mystery payments surfaced in the media last month.

In a reply to a parliamentary question asked by Democratic Alliance MP David Maynier on Wednesday, Gordhan also questioned Moyane’s “stewardship of a vital fiscal institution”.

This latest salvo between Gordhan and Moyane, who are known to have a fraught relationship, relates to an investigative report by the Financial Intelligence Centre (FIC) received by Moyane on May 18.

It details how, over several years, about R1.2-million in mystery payments made its way into the bank account of Jonas Makwakwa, who is the second most senior official in Sars and heads its business and individual taxes unit. Payments were also made into the account of his alleged girlfriend, Kelly-Ann Elskie, whose employment in the Sars legal division is also under scrutiny.

The FIC report details questionable behaviour including how, in one day, Makwakwa deposited cash from unknown sources using three ATMs within a 10km radius of each other.

Gordhan said he was perturbed by Moyane’s lack of action regarding the allegations against Makwakwa.

“It is perturbing that, considering the origins of these funds were not confirmed, Mr Moyane allowed Mr Makwakwa to remain in his position dealing with individual and corporate taxpayers.
It is my opinion that Mr Moyane failed to inform me of the matter possibly in an attempt to resolve the issue without the matter becoming public.”

Gordhan’s criticism stems from Moyane apparently sitting on the FIC report for four months before taking action.

It was only after Maynier questioned Moyane in Parliament, and media queries were sent asking about the payments, that Moyane suspended Makwakwa and appointed law firm Hogan Lovells to investigate the matter, on September 15.

Moyane’s answer to Parliament, incorporated into Gordhan’s, tries to downplay the time lapse between May 18 and September 15 – between the FIC report being received and action being taken.

Said Moyane: “The report was not referred for further investigation at that stage. Sars had adopted a two-pronged approach towards handling this matter. The first part entailed affording Mr Jonas Mashudu Makwakwa and Ms Kelly-Ann Elskie an opportunity to respond in writing to the allegations against them. This was part of the internal investigative process that Sars undertook.”

Gordhan, however, was having none of it and questioned Moyane’s ability to take responsibility as an accounting officer.

“Since the report in the newspapers, Mr Moyane has publicly criticised the FIC rather than take the responsibility an accounting officer is expected to assume in dealing with such vital matters,” the minister said.

The FIC report also details that electronic payments were made into Makwakwa’s account from various sources, including “irregular and ad hoc payments from Sars”. Three payments were also made to Elskie.

According to the report, “[Makwakwa’s] payments (expenses) have grown (between March 2010 and January 2016), creating a dependency on [suspect] cash deposits and payments to maintain his current standard of living. These payments and cash deposits are of concern as they originate from unknown sources.”