Exposed: police rot

The country’s most trusted spy outfit – the SAPS’s crime intelligence – is teetering on the brink of collapse owing to rampant mismanagement, fraud, corruption, nepotism and a lack of leadership.

A number of concerned operatives have written several dossiers raising concerns about how the mismanagement of crime intelligence is a security risk for the nation – given the historic problems that affected the perpetually ineffective National Intelligence Agency. In one of the confidential dossiers, they claim that “a dynasty like the one alleged in the British Intelligence Service is created… (and) it looks after itself and family interests through state resources. Meetings are scheduled in comfortable hideouts at state costs, only to find that it was family or friends’ outing”.

In a document, dated October 27, 2009, one PZ Magadla of counter- intelligence in KwaZulu-Natal reports that another dossier on “diverse issues of corruption and other ills” was being prepared. One senior leader based in Gauteng is accused of taking his girlfriend on an official trip to Singapore. A handful of crime intelligence operatives told The Sunday Independent that a report two weeks ago in this paper on jobs and promotions for General Bheki Cele’s pals was the tip of the iceberg since the organisation was badly infested.

They said it was disturbing that even those in charge of covert operations were caught in a web of criminality. This raised the serious question of who, in fact, was watching over the republic?

The NIA is battling to recover from divisions and paralysis that came with former director-general Billy Masetlha’s messy axing and the hoax e-mail saga. Some in crime intelligence have pointed an accusing finger at crime intelligence boss Richard Mdluli, accusing him of acting outside of the law and allowing an environment of maladministration and mismanagement to fester under his stewardship. They allege Mdluli has his eyes removed from:

*Abuse of covert premises, where girlfriends are housed

* Abuse of a slush fund, with “loans” to operatives favoured by the leadership

* Some people who registered their children as crime intelligence sources in order to get income.

The situation appears worse in KZN with more than five top officials employing their sons, sisters, girlfriends, nieces and wives. More than 30 officials in KZN crime intelligence are related to each other. Deputy national commissioner of police Ray Lalla and KZN head of crime intelligence Dina Moodley are fingered in a confidential nepotism report written after a mass crime intelligence meeting held at Amanzimtoti Civic Centre on KZN’s South Coast in October 2009. Lalla’s daughter was, at the time the report was written, working for crime intelligence.

The report points out that nepotism poses a security risk due to the sensitive nature of the crime intelligence environment and the level of objectivity that is expected. “The employment as well as the unfair promotion of relatives in that environment is a serious threat to security. Some of these people are employed and placed in covert premises. Those who are aware of such practices can blackmail those who perpetrate this practice and threaten them to the extent of forcing them to divulge classified state information,” it reads.

Several laid the blame on Mdluli’s leadership and the protection he appeared to receive from Cele. “It is a Zulu dynasty – I dare Cele to act against Mdluli. We have a Zulu-Nostra now. Cele knows what the problems with Mdluli are. Should the organisation collapse before he does something?” asked a source. The specific allegations against Mdluli are that:

* He appointed under-qualified people to lead experienced spooks because he did not trust them. They use the example of a human resources development officer who was appointed head of crime intelligence without a knowledge of the environment.

*He allegedly protects Major General Solly Lazarus, in charge of the spooks slush fund, from the vetting staff who want to subject him to a vetting process.

*He and Lazarus created 250 new posts without consulting HR – and advertised the posts without mentioning them as SAPS posts and thus denying many opportunities of promotions.

* He recommended to Cele the promotion of Constable Nkosana Sebastian Ximba, who jumped seven ranks to become a colonel. This was in spite of the fact that Ximba was facing a case of assault with grievous bodily harm which was opened at Johannesburg Central. He is perceived as a close acquaintance of Mdluli.

* Like ministers, Mdluli drives two official cars – a Q7 and a Mercedes – and has assigned to himself a driver and a bodyguard even though there is no such policy provision for his post.

Those who spoke to The Sunday Independent wanted to know what Cele was doing about the mess. The SAPS’ spokesperson, Nonkululeko Mbatha said the police management wished not to comment about the allegations. However she said they were aware of them. Mdluli couldn’t be reached on his cellphone yesterday and also did not return text messages sent to him.

Two other sources at senior level said that Cele was “extremely concerned” about the leadership paralysis in crime intelligence and was allegedly working behind the scenes to restore order. Other officials fingered are the retired KwaZulu-Natal police commissioner Hamilton Ngidi, KZN commander of crime intelligence operations Director SO Ndlovu, BB Mncwango cluster commander of Ulundi, Captain SE Madikane Donnybrook cluster commander, Colonel GJ Ncube commander of the Operational Intelligence Analysis Centre and others.

Moodley allegedly brought in his brother who was working for the Department of Correctional Services and gave him a captain’s rank. Moodley’s brother was placed on undercover gathering and resigned after just over a year. Ngidi is alleged to have brought in his stepdaughter (a daughter out of wedlock by his wife) as a clerk. She was soon promoted to captain. She then became a lieutenant colonel at crime intelligence after a couple of years.

Ndlovu, according to the report, employed his girlfriend to the rank of lieutenant colonel at the security intelligence division five months after she had joined crime intelligence as a detective.

Mncwango employed his son, Madikane employed his sister who is, according to the report, stationed at Umlazi crime intelligence while Ncube employed his sister’s daughter.

Source: IoL

Sandile Majali arrested

Sandile Majali was arrested by the SAPS Commercial Crimes Unit on Thursday afternoon for alleged fraud. This followed an investigation after the directorship of mining company Kalahari Resources was changed from Brian Amos Mashile and his sister Daphne Mashile-Nkosi to a group of eight individuals including Majali, the unit said in a statement. Majali and seven others allegedly removed Kalahari Resources' directors from the Companies and Intellectual Property Registration Office (Cipro) database in August.

An urgent interdict was brought before the High Court in Johannesburg last month. The court ruled that Cipro reinstate the siblings as directors of the company. Reacting to the news of the arrest, Mashile-Nkosi told Sapa that she was relieved. “I feel exonerated and energised that the criminal justice system in my country is working - it may be slow but the wheels of justice are beginning to move ... now it's for the court to decide.”

Kalahari Resources owns a 40 percent stake in Kalagadi Manganese, the mining company developing an R11-billion manganese mine and sinter plant in the Northern Cape, as well as a smelter at Coega. The Industrial Development Corporation owns 10 percent of Kalagadi Manganese, while steel producer ArcelorMittal owns the remaining 50 percent stake. Majali came into the public eye following his role in the so-called Oilgate saga that saw him “donate” R11-million of PetroSA's funds to the ANC ahead of the 2004 elections. According to a police spokeswoman who did not wish to be named, four members of the group - including Majali - have been arrested and police were “hot on the heels” of the other four. “The arrests have been a collaboration between the police, the Hawks and a private investigator appointed by Kalahari Resources.”

The spokesperson said the four would appear in court on Friday but could not supply further details.

Source: IoL

Mpumalanga's MEC for human settlements and two of his bodyguards were shot at, then robbed by men driving a car with a flashing blue light last night, police said today. Captain Leonard Hlathi said the MEC, Madala Masuku, was travelling at the offramp for Bapsfontein near Delmas around 8.15pm, when a silver grey BMW five series came up behind them, with blue lights flashing, signalling for them to stop. Masuku's car also had a flashing blue light, and his driver ignored what was happening and kept driving. "They fired a shot through the MEC's car and the driver then brought the car to a standstill," said Hlathi. After that, three men from the BMW, dressed in the blue police uniform, approached the MEC's vehicle and claimed they were looking for drugs and "other unlawful things". "The MEC introduced himself and said he was an MEC, he was carrying no drugs, and that he was with his two bodyguards," continued Hlathi. The men said they would take the MEC and the bodyguards to a police station and verify their identities, but in the meantime, took away six cellphones, a bodyguard's firearm and the car keys. They later handed back the cellphones and fled the scene with the car keys and the firearm. They drove off in the direction of Johannesburg. Hlathi said the police hoped that anyone who may be able to provide information on the matter would pass this on to police. Masuku's spokesman was not immediately available to comment but Hlathi said the three were not physically hurt during the shooting. Police have not linked it to other potentially politically motivated incidents in the province and the possible existence of a "hit list". Victor Mlimi, a deputy director in the Mpumalanga department of human settlements, was recently charged with fraud, forgery and uttering along with Sunday Times reporter Mzilikazi wa Afrika. Wa Afrika was in possession of a letter of resignation purportedly from the province's premier, David Mabuza. The charges against Wa Afrika and Mlimi were withdrawn on September 8. Hlathi thought yesterday's incident was "just mischief". "Blue light gangs", groups of people who take the appearance of police officers to get people to pull over to rob them, are not uncommon in South Africa.

Mpumalanga's MEC for human settlements and two of his bodyguards were shot at, then robbed by men driving a car with a flashing blue light last night, police said today. Captain Leonard Hlathi said the MEC, Madala Masuku, was travelling at the offramp for Bapsfontein near Delmas around 8.15pm, when a silver grey BMW five series came up behind them, with blue lights flashing, signalling for them to stop.

Masuku's car also had a flashing blue light, and his driver ignored what was happening and kept driving. "They fired a shot through the MEC's car and the driver then brought the car to a standstill," said Hlathi.

After that, three men from the BMW, dressed in the blue police uniform, approached the MEC's vehicle and claimed they were looking for drugs and "other unlawful things". "The MEC introduced himself and said he was an MEC, he was carrying no drugs, and that he was with his two bodyguards," continued Hlathi. The men said they would take the MEC and the bodyguards to a police station and verify their identities, but in the meantime, took away six cellphones, a bodyguard's firearm and the car keys. They later handed back the cellphones and fled the scene with the car keys and the firearm. They drove off in the direction of Johannesburg. Hlathi said the police hoped that anyone who may be able to provide information on the matter would pass this on to police.

Masuku's spokesman was not immediately available to comment but Hlathi said the three were not physically hurt during the shooting.

Police have not linked it to other potentially politically motivated incidents in the province and the possible existence of a "hit list". Victor Mlimi, a deputy director in the Mpumalanga department of human settlements, was recently charged with fraud, forgery and uttering along with Sunday Times reporter Mzilikazi wa Afrika. Wa Afrika was in possession of a letter of resignation purportedly from the province's premier, David Mabuza. The charges against Wa Afrika and Mlimi were withdrawn on September 8.

Hlathi thought yesterday's incident was "just mischief". "Blue light gangs", groups of people who take the appearance of police officers to get people to pull over to rob them, are not uncommon in South Africa.

SOurce: The New Age

Poisoned: The man who blew the whistle on Mpumalanga's hit squad

A confidential autopsy report says that Mpumalanga politician James Nkambule, who died suddenly last week, was poisoned. Nkambule, 37, was the whistle-blower who earlier this year claimed that politicians were behind assassinations in the province. He alleged that corruption surrounding the building of the province's multibillion-rand Mbombela stadium for the World Cup led to the deaths.

Nkambule collapsed and died at his home in Mjindini on Thursday night last week. At the time he was attempting to get a Mozambican man - who he believed to be the hit man - placed in the witness protection programme. The autopsy, conducted by Mpumalanga chief medical officer Dr Gantcho Gantchev, concludes his death was "unnatural". In the postmortem report, Gantchev describes "white foamy material" found in Nkambule's throat and windpipe, and about 30ml of brownish fluid "suggestive of ... poison ingestion" in his stomach. Gantchev told the Sunday Times: "There is no smoke without fire." "They killed him, they killed my dad," Nkambule's daughter, Buhle Nkambule, said on hearing the news. Toxicology tests will establish the type of poison and when it entered his system.

Nkambule first rose to prominence in 2001 when he claimed there was a plot to overthrow then president Thabo Mbeki. He had been branded a "professional liar" by the ANC after publicly accusing members Mathews Phosa, Tokyo Sexwale and Cyril Ramaphosa of being behind the move.

The ex-ANC member also recently claimed that Mpumalanga premier David Mabuza paid R400000 towards President Jacob Zuma's wedding last year. These claims were never denied by the Presidency. His wife, Claudia Xwabe, said this week that Dr Gantchev had told the family that the postmortem showed there was "a drug in (Nkambule's) body".

On Friday, police confirmed that "foul play" was suspected. "We have opened an inquest into the death," said provincial police spokesman Captain Leonard Hlati. Nkambule had recently met with police commissioner General Bheki Cele to discuss efforts to bring a Mozambican man, known in the criminal underworld as "Josh", to South Africa, where he was to be placed under a witness protection programme. Josh was to testify against prominent figures regarding the death of former Mbombela municipality speaker Jimmy Mohlala. Mohlala was killed after he blew the whistle on irregularities in the awarding of tenders to build the R2-billion Mbombela stadium. Mohlala's name was on a hit list of nine municipal officials opposed to awarding the contract for the construction of the stadium.

Josh has since claimed in an affidavit, now in the possession of the police, that he was hired by Mpumalanga officials and a soccer boss as a "cleaner" from 2000 until 2009 to eliminate political and business opponents. His work included smuggling drugs, poisoning people and carrying out other "hits". He said that the people he targeted included Nkambule; a former mayor of the Gert Sibande district council, Andries Gamede; Scopa chairman Fish Mahlalela; and Mbombela mayor Lassy Chiwayo.

He further alleged that Govan Mbeki municipality chief financial officer Joshua Ntshuhle's car was driven to Malawi to make it look like he had vanished. Ntshuhle went missing in December 2005, days before he was due to testify in the fraud and corruption trial of the municipality's marketing manager, Sibusiso Sigudla. The gangster further claimed that he was hired, along with three Zimbabwean nationals and a fellow Mozambican, to kill Mohlala. He said four of the men who helped carry out the hit on Mohlala had since been killed.

Nkambule recently slammed the police investigations into the murders - which might have also exposed the tender irregularities - as slow. He was due to appear in court this week on charges of fraud and defeating the ends of justice after police accused him of fabricating the sworn statement by Josh.

The Sunday Times has established that the police have yet to question anyone in connection with Nkambule's earlier complaint that he had been poisoned. The politician had maintained he was poisoned in 2006 by political opponents, leaving him having to be hospitalised several times. In August last year, Nkambule said, Josh approached him and confessed that he had poisoned him on instructions from a senior politician. In a statement seen by the Sunday Times, Josh details how he was handed "a small bottle that was full of liquid substances" in 2006, and instructed to infiltrate a company catering for a matric dance in Barberton where Nkambule was a guest speaker. "I did in September 2006 ... empty the bottle ... in James Nkambule's food and I went to personally serve him at his table," he said in his statement.

Josh claimed he was prompted to confess to Nkambule after he learnt that his fellow assassins had all been executed to destroy evidence. Nkambule submitted the statement to police in February - whereupon he was arrested on suspicion of fabricating the statement. Hlati this week rubbished Nkambule and Josh's claims: "We did not question any person because we did not receive any statement from Josh," he said on Friday. "If you have this Josh, please produce him."

Source: Times Live

Foreclosure Fraud Propped Up Mortgage-Backed Securities -- And Protected Banks That Issued Them

The reason they're faking the mortgage documentation? If the bankers admit what's wrong with the chain of title conveyance, the mortgage loans are no longer eligible for the trusts the bankers sold to investors -- and under their own terms of agreement, the chain of title was breached, "true sale" was probably not achieved and the liability reverts to the banks.

Investors are likely to sue to recover their money. The government will probably stand behind Fannie Mae and Freddie Mac investors, but private banks are another matter. Some major dominoes seem likely to fall.

MorIt's important that we don't fall for the media misdirection here: It's not "poor banks getting screwed by mortgage deadbeats." It's really "poor investors getting screwed by banks who knowingly sold them worthless mortgage bonds." Felix Salmon:

This kind of information was valuable to Citigroup: it showed them that the quality of the loan pool was much lower than you’d think just by looking at the ostensible underwriting standards.

Armed with this information, Citigroup would do two things. First of all, it would take those 582 rejects and put most of them back to the underwriter. Essentially, they said, the loans weren’t as advertised, and they didn’t want them. But Citi would still keep some of them in the pool.

But remember that Clayton had tested only a small portion of the loans in the pool. So Citi knew that if there were a bunch of bad loans among the loans that Clayton tested, there were bound to be even more bad loans among the loans that Clayton had not tested. And those loans it couldn’t put back to the originator, because Citi didn’t know exactly which loans they were.

If there had been any common sense in the investment banks, that would have been the end of the deal. But there wasn’t. Rather than simply telling the originator that its loan pool wasn’t good enough, the investment banks would instead renegotiate the amount of money they were paying for the pool.

This is where things get positively evil. The investment banks didn’t mind buying up loans they knew were bad, because they considered themselves to be in the moving business rather than the storage business. They weren’t going to hold on to the loans: they were just going to package them up and sell them on to some buy-side sucker.

In fact, the banks had an incentive to buy loans they knew were bad. Because when the loans proved to be bad, the banks could go back to the originator and get a discount on the amount of money they were paying for the pool. And the less money they paid for the pool, the more profit they could make when they turned it into mortgage bonds and sold it off to investors.

Now here’s the scandal: the investors were never informed of the results of Clayton’s test. The investment banks were perfectly happy to ask for a discount on the loans when they found out how badly-underwritten the loan pool was. But they didn’t pass that discount on to investors, who were kept in the dark about that fact.

I talked to one underwriting bank — not Citi — which claimed that investors were told that the due diligence had been done: on page 48 of the prospectus, there’s language about how the underwriter had done an “underwriting guideline review”, although there’s nothing specifically about hiring a company to re-underwrite a large chunk of the loans in the pool, and report back on whether they met the originator’s standards.

In any case, it’s clear that the banks had price-sensitive information on the quality of the loan pool which they failed to pass on to investors in that pool. That’s a lie of omission, and if I was one of the investors in one of these pools, I’d be inclined to sue for my money back. Prosecutors, too, are reportedly looking at these deals, and I can’t imagine they’ll like what they find.

The bank I talked to didn’t even attempt to excuse its behavior. It just said that Clayton’s taste-testing was being done by the bank — the buyer of the loan portfolio — rather than being done on behalf of bond investors. Well, yes. That’s the whole problem. The bank was essentially trading on inside information about the loan pool: buying it low (negotiating for a discount from the originator) and then selling it high to people who didn’t have that crucial information.

This whole scandal has nothing to do with the foreclosure mess, but it certainly complicates matters. It’s going to be a very long time, I think, before the banking system is going to be free and clear of the nightmare it created during the boom.

The courts, accountability and participatory democracy

Salt River: Irene Grootboom brought the first successful socio-economic rights case to the Constitutional Court. The case tested the Court. We had adopted a Constitution which deliberately included social and economic rights, in recognition of the fact that full democracy is more than the right to vote: it also implies social justice, in the form of access to the basic necessities of life which enable us to lead our lives with dignity, and to achieve our full potential as human beings.

Quite obviously, the first job of the courts is to enforce the Constitution and the rights which it contains. A person whose home has been destroyed and who has nowhere she can legally live, has no access to housing and is denied one of the most fundamental necessities of life. A court cannot fold its arms and say that this is bad luck, it is the consequence of apartheid, and one day things may change. The question is not whether the court should do something. Rather, it is what the court should do.

Judges often find this a difficult question. They point out that where there is a large-scale failure to meet the needs and rights of people, one of the questions which has to be answered is "who first?" If you cannot serve everyone at the same time, whose needs should enjoy priority? And there are questions of "how much?" If the right is a right of access to adequate housing, or to education, what quality of housing or education has to be provided before it meets the constitutional standard? How do you assess that when giving more to one may mean giving less to another?

The Grootboom case showed that this is not the first question. The first question is whether there has been a breach of constitutional rights. If there has been a breach, the first duty of the courts is to say so. This is important in itself. It vindicates the complainant, it puts the government on the spot for its failures, and it educates and informs us about our rights and obligations.

The Court declared that the failure of the government to create a programme for emergency relief for those who are in a desperate situation is a breach of the Constitution. The Constitution requires that the government's housing programme must be reasonable. It is not reasonable to say to someone who is homeless that she must wait, homeless, to be provided with a full house in twenty years' time.

But having done that, the questions remain: "who first?", and "how much?" Courts which are faced with these questions usually give two answers.

The first is that the court is not competent to answer those questions. The only people before the court are the complainants and the government: other homeless people, who also have claims, are not there, and are not able to place their facts and their demands before the court. The judges are limited to the information which is placed before them in the case - they cannot rely on any other source of information. And the judges have no skill in formulating housing policy. They do not know what is practically achievable, and how to achieve it.

The second answer which is given is that these decisions should be made by people who are democratically accountable for their decisions. No-one votes for a judge, and a judge who gives a bad decision cannot be voted out of office. These decisions, it is said, should be made by those who are democratically accountable.

There is truth in both of these answers. However, neither of them is a complete answer.

In the first place, the question whether Ms Grootboom should receive a house, or whether the children in mud schools in the Transkei should receive a decent school building, is in truth never the subject of an electoral process. We vote twice every five years, and it is an all or nothing vote. You cannot say I support the ruling party, and I vote for it, but I vote against its policy on emergency housing, or its policy about funding allocations to schools. To suggest that these decisions are subject to a democratically accountable process is rather overstating it. You have to ask yourself the simple question: when did anyone vote against the provision of emergency housing for homeless people? Which party said that children should continue to learn in mud schools in the Transkei, and who voted for that policy?

The claim that government is democratically accountable for these decisions is therefore something of a fiction. We do not vote for these details, and we are never given the opportunity to do so.

Secondly, most of these decisions are not taken by elected office bearers. In the Grootboom case, the government had never made a decision not to provide emergency housing - there was simply a gap in the policy. The housing policy was constructed by officials and experts, and perhaps approved by the Minister. It was never considered by a democratically accountable deliberative body. Similarly, the decisions on what funding to allocate to school buildings are not made by a democratically elected Parliament. They are made by officials and senior politicians, sitting in an office. They are the people who allocate resources. They do the best they can, behind closed doors. They usually do not have to account publicly for those decisions.

Judges sit in public. They have to listen to argument, and they have to give reasons for their decisions. This is a strong form of accountability. I have sat as an acting judge, and I have worked as a government official. I can truthfully say that the pressures of accountability which I felt as a judge were greater than in respect of most of the decisions which I had to take as the head of a government department.

So the argument about non-accountability of judges has to be taken with a pinch of salt. It is true that they are not elected, but it is also true that they have far more direct accountability than many of the people who make the decisions which affect people in their daily lives.

There are, however, valid questions about the competence of judges to make decisions about competing claims to the allocation of resources. I would certainly not want to live in a country run by the judges.

What, then, should judges do when they find a breach of rights, but it is not possible or appropriate for them to decide the detail of the remedy? The key to this is to promote accountability. The principle of accountability for the exercise of power is fundamental to our Constitution.

The first thing the courts can do once they have found a breach, is order the government publicly to state what it has done to remedy the breach, what it will do in future, and when it will do it. This creates the opportunity for the public to hold the government accountable. If the government's programme is inadequate, it creates the space for public debate and campaigning, for mobilisation and organisation, which will seek to compel the government to do better. The people are given the information which enables them to hold their public representatives to account.

And when the government says what it will do in the future, it creates a benchmark against which its conduct can be tested. If it fails to meet that benchmark, and cannot justify its failure, it may find itself back in court, or it may find itself in the court of public opinion, having to justify its actions to the people. Again, participation and democracy are deepened.

The second thing the court can do is require the government to report to it on its plans, and on the implementation of those plans, so that the court can judge whether this satisfies the constitutional standard. This is sometimes referred to as a structural interdict. The government is given the space to decide how best to give effect to the right, and the court is then asked to decide whether what the government has chosen to do, meets the requirements of the Constitution. This enables the courts to avoid having to decide questions which are beyond its competence, while ensuring that what is done does in fact meets the constitutional standard.

The third thing the Courts can do is make an order which promotes participation and accountability "on the ground".

For example, the Constitutional Court has held that a municipality which wants to evict people has to "meaningfully engage" with them before bringing any proceedings for eviction. The Olivia Road case showed how this can work. In that case, some hundreds of people were living in the inner city in Johannesburg in truly dreadful privately owned buildings. The buildings were unsafe - there was a high risk of fire, and there were very real health dangers.

The City applied to court to have the people evicted. The people said that they would not go, because they needed to be in the inner city where they earned a modest income - there was nowhere else for them to go, and they would rather stay in those buildings, with all of those risks, than be consigned to the outer darkness of the urban fringes, where they would starve.

What was the Court to do? Was it to order the eviction, knowing that this would likely cause terribly suffering and hardship, or should it allow the people to stay where they are, knowing that this too was likely to cause great suffering and hardship?

The Court did neither. It ordered the parties first to "meaningfully engage" with each other on the solution to this problem, and then to report back to the Court. Now, for the first time, the City had to deal with the residents as equals. Both sides knew that they would have to go back to Court and explain themselves. Both knew that if they acted unreasonably, there was a risk that the Court would make an order against them. The previous inequality between the all-powerful City and the powerless residents was suddenly changed.

The result was remarkable. The City agreed to make some immediate improvements to the buildings, to limit the risk of fire and health hazards. It found other buildings in the City to which the residents could move, once they had been renovated. The residents agreed to leave their homes. They agreed to pay rent if they were able to do so. An apparently intractable situation had been resolved.

What the Court had done, was promote democratic accountability. It made the City account to the residents for its actions, and justify and explain them, and if necessary justify and explain them to the Court. It transformed the residents from people pleading for government largesse, into the holders of rights who were in a position to negotiate with the government because they held rights. That, of course, is the very purpose of rights: it is to transform and regulate power relations.

Fourteen years after the adoption of our final Constitution, deep inequality and poverty continue to mock our efforts to build a democracy based on social justice. The Constitutional Court has shown that there are ways in which the courts can help us to achieve our highest goals by broadening and deepening democratic participation, and promoting the accountability of power.

* Advocate Geoff Budlender - Second Irene Grootboom Memorial Lecture (2010) in Salt River, 11 October 2010)

Source: ANSA-Africa

Imperial kickback case set for trial

A senior banker who allegedly dished out over R200-million in unauthorised bank loans to property developers in exchange for kickbacks almost a decade ago is finally being brought to book.

Eben Kotze, the former head of property finance at Imperial Bank, a division of the Nedbank Group, faces a litany of charges - including fraud, corruption, money-laundering and perjury - relating to his three years in that position. The case against him is set out in a 140-page indictment that will form the basis of his criminal trial in the High Court in Johannesburg next year.

Many of the 50 charges against the 49-year-old relate to him allegedly using his position to award multimillion-rand loans to developers who would not otherwise qualify for them, in exchange for bribes. In addition, Kotze is said to have taken profits from some of the property deals.

Through a variety of business vehicles, including close corporations and trusts, Kotze allegedly bought and immediately sold properties to developers for exorbitant profits, often double or in one case three times the original purchase price. He is also accused of providing other "favours" for developers, including concealing from the bank that they were not paying deposits for the properties, wrongfully transferring amounts between loan accounts, and fast-tracking progress payments from these accounts, knowing that in many of these cases the claims were fictitious.

In exchange for these favours, he allegedly demanded payments of hundreds of thousands of rands. In one case he claimed R495000 - which was used as a deposit on a house for his mother. Many instances are mentioned in the indictment, including the more than R3-million that one developer allegedly paid Kotze either in cash or indirectly by, for example, contributing towards properties purchased, including in the Pecanwood golf estate near Hartbeespoort Dam.

In addition, Kotze allegedly received payment in kind, in the form of building materials for his and his mother's homes, as well as renovations to his home and his church, both in Roodepoort, west of Johannesburg. One of the developers implicated, Hendrik Lubbe, pleaded guilty to several charges including fraud and corruption in 2007. He was sentenced to three years' correctional supervision and received a five-year suspended prison sentence. National Prosecuting Authority spokesman Mthunzi Mhaga confirmed that no one else had been charged in connection with the matter. Other developers Kotze is alleged to have "conspired" with are believed to have turned state witness. Mhaga said he was unable to comment on this.

Kotze, who was arrested in September 2007 and is currently out on R1-million bail, was bust after two of these developers told the bank they had been paying him kickbacks after their relationship soured. "At the time, we had no idea," Piet Swanepoel, formerly Imperial Bank's property finance head and now part of Nedbank Business Banking, told the Sunday Times this week. Swanepoel said that Kotze, who he described as "seriously intelligent", was suspended in August 2004 and dismissed in February 2005 following a forensic investigation by PricewaterhouseCoopers.

Swanepoel said it was "very difficult" to quantify the bank's loss as a result of Kotze's actions, but added that it had largely been offset by foreclosing on the mortgage bonds registered over the properties. "The luck we got was the property market at the time - people were paying crazy amounts at the time, but the risk he exposed the bank to, if it had been in circumstances like now, it would've been very different," Swanepoel said. The matter was in court on Monday, when it was postponed for trial in April next year. It is expected to sit for the entire court term.

Kotze, who is a director of several companies and who lives in Strand in the Western Cape, has not yet pleaded, but he told the Sunday Times this week that he intended to plead not guilty, and the details of his case would emerge during the trial.

Source: Times Live

China's Liu Xiaobo wins Nobel Peace Prize

Liu Xiaobo, an irrepressible, chain-smoking Chinese dissident imprisoned last year for subversion, was awarded the Nobel Peace Prize Friday for helping to spearhead a campaign for more freedom in China. In a statement, the Nobel Committee said Liu, 54, deserved the prize "for his long and non-violent struggle for fundamental human rights in China." Analysts said the honor was aimed in part at increasing pressure on China to ease its crackdown on religious and political activists. But China's government told reporters the committee had violated its own principles by giving the award to a "criminal."

In announcing the award, the committee lauded Liu's efforts over more than two decades to demand freedom of speech, assembly, religion and other forms of expression for Chinese citizens. China's "new status" as the world's second-largest economy "must entail increased responsibility," the committee said. It said Beijing must heed the call of Liu and others to award its citizens the most basic freedoms. "Through the severe punishment meted out to him, Liu has become the foremost symbol of this wide-ranging struggle for human rights in China," the Nobel statement said.

Liu is serving his 11-year sentence at Jinzhou prison in Liaoning, hundreds of miles from his home and wife, Liu Xia, in Beijing. In an interview shortly before the announcement, Liu Xia said she was thankful her husband's physical condition seems to have improved in jail, and grateful that he's allowed to read and that the two can exchange regular letters. "We have no regrets," she said. "All of this has been of our choosing. It will always be so. We'll bear the consequences together. I've known Liu since 1982. I've watched him change little by little year by year, and we know that we have to pay the price under the current situation in China."

In the weeks running up to the announcement, Liu was considered a top contender to win the award. But China's government had warned Norway not to award Liu its most prestigious prize, saying that the essayist did not qualify for the honor. Analysts predicted that in the short-term, China's one-party state would react to the award by intensifying an already tough campaign against dissidents, religious activists and non-governmental organizations. Although China outwardly appears strong, with a world-beating economic growth rate, prosecutions for "state security" offenses are approaching numbers not seen since the bloody crackdown on student-led protests around Tiananmen Square in 1989. But in the long-term, a wide spectrum of Chinese and foreigners said, Liu's award could actually resonate more deeply within China than any similar act in years--significantly more so than the Nobel Peace Prize that was awarded to the Dalai Lama in 1989 or the Nobel prize for literature given to dissident writer Gao Xingjian in 2000.

First of all, Liu will be the first Chinese citizen to ever win the award. (The Dalai Lama has status as a refugee. And Gao is a French citizen.) Second, Liu, unlike most Chinese dissidents, remains well-known and well-liked in China. Prickly, with a thick northern drawl, tobacco-stained teeth and an infectious laugh, he's always been considered part of the "loyal opposition," less a theoretician of a democratic revolution than a tough urban gadfly. Although in and out of jail for stating his beliefs, writing letters and challenging the state for two decades, Liu has escaped the sentence of irrelevance meted out to so many of his dissident contemporaries. Some observers, however, said the award would feed into a sense among many young Chinese that the West is out to get China and that "Cold War" thinking still dominates mindsets in the developed world. "I worry about the effect of this prize on China's younger generation," said Zhu Feng, a professor of international relations at Beijing University. "It will be seen as new evidence about how the West is unfriendly to China."

Liu's latest sentence was his longest. Announced on Christmas Day 2009 - because the Chinese government believes Westerners are less likely to take notice on a holiday--Liu's sentence of 11 years was for attempting to subvert the state. His specific crime was that he volunteered to have his name lead a list of signatories to a document called "Charter 08." Modeled after the Charter 77 movement in Czechoslovakia during the Cold War, Charter 08 called for greater freedom of expression, human rights, and for free elections. Ultimately, more than 8,000 people have signed China' s charter.

Published on Dec. 10, 2008, the 60th anniversary of the Universal Declaration of Human Rights, the charter "was to put a stake in the ground and say here's an alternate vision of China," said Perry Link, the renowned China scholar who worked with the group to translate their manifesto into English. "It was definitely a long-term program." Among the demands were for a judiciary not controlled by the Communist Party, meaningful elections and the freedoms of association, assembly, expression and religion. "The current system has become backward to the point that change cannot be avoided," the charter read. "This situation must change! Political democratic reforms cannot be delayed any longer!"

Liu played an important role as the crafters of the charter hashed out the wording, Link said. He fought to excise any mention of the banned sect Falun Gong from the document because, he argued, the charter's purpose should not be to deal with specific human rights cases. And he helped work out a compromise over mentioning the Tiananmen Square crackdown - which was raised in the preamble but not in the actual body of the charter. Link, who spent much of that month talking with Liu and others as the manifesto went from one draft to another, recalled that Liu wasn't a leader of the group in the beginning. "But once he saw it was going somewhere, he naturally volunteered to be out front," Link said.

Liu didn't hog publicity, Link added, "he just doesn't shrink from putting his head on the line. He was like a moth to the flame." After he was sentenced, Liu's lawyer released a simple statement from his client: "I have long been aware that when an independent intellectual stands up to an autocratic state, step one toward freedom is often a step into prison," it said. "Now I am taking that step; and true freedom is that much nearer."

Ai Weiwei, a signatory of the Charter 08 document who designed the Bird's Nest stadium for China's Summer Olympics, said Friday's award was at least a sign that "the world is paying attention to China." But the award "won't change much in China," Ai predicted. "More people need to wake up." Liu has taken risks with his life throughout his career. In 1989, he left a cushy post as a visiting scholar at Columbia University to return to China to participate in demonstrations in Tiananmen Square.

On the night of June 3, 1989, he was one of four dissidents who negotiated with the People's Liberation Army to allow the last several hundred students to peacefully vacate the square. After the crackdown he spent two years in jail. Liu was dispatched to a re-education camp in 1996 for co-writing an open letter that demanded the impeachment of then-president Jiang Zemin. From then until his arrest in December, 2008, two days before the charter was released, Liu lived a life of constant harassment by the security services. He was repeatedly questioned because of his views or his essays, which were passed around the Internet by thousands of his readers.

Liu's wife, Liu Xia, said the toughest time for her was after Liu was arrested in 2008 but before he was indicted. He basically disappeared, she said, into the maw of China's security state. "For those six and half months, I only saw him twice, it was weird for both of us," Liu Xia recalled. "I was taken to a hotel in a suburb of Beijing, Xiaobo was taken there too, and he told me he didn't know where he was." But when the indictment came, "I felt very calm," she said. "I told our lawyer that Xiaobo would probably be sentenced at least 10 years. Then it came out 11, very close to what I expected."

Source: Washington Post

Cracks in slum queen’s empire

Buffalo City Municipality has finally moved to start dismantling the empire of a notorious slum queen in just under a year after the Dispatch exposed her activities.

Nompiliso Yekela gained notoriety last November when an undercover investigation revealed how she was buying up homes in King William’s Town and filling them with mostly poor and desperate tenants. After the Dispatch infiltrated the lucrative side-business of Yekela, who works in the human resources department of the Office of the Premier, there was little reaction from the municipality.

But on Tuesday council voted in favour of overturning the rezoning status of one of her properties, making it illegal for it to operate as a residence. It also approved a recommendation by the city’s legal services department that legal action be taken to ensure Yekela ceased the operation of what they called “residential rooms”. This was after it was found she was not complying with conditions set down by law. It is not clear when the city will move to shut down this residence .

Contacted for comment yesterday, Yekela said: “ You can continue doing what you’re doing. I have nothing to say to the Dispatch.” BCM councillors were also livid that only one house belonging to Yekela had been targeted for closure. “There was a report on the woman in the Dispatch, thus I would have expected that council would bring a report which would talk about all the houses she owns and operates in King William’s Town,” ANC councillor Luntu Bobo said.

Annette Rademeyer, who is a councillor from the area, said she expected Yekela’s empire to crumble soon. “This particular problem has been ongoing for at least the last five years. I have personally been involved in this with various neighbours complaining … This person owns a lot of other properties that I’ve also had complaints about, and they have also been reported to the legal department and I’m assuming it’s in the legal process,” she added.

After breaking the story on conditions at Yekela’s six residences, the Dispatch won the CNN African Journalist Awards for its online depiction of the investigation. Part of the investigation also covered slums in Southernwood, but the city has yet to consider taking action in the East London suburb. The residence the city wishes to close down in Pottinger Street, King William’s Town, is the same in which former Dispatch reporter Gcina Ntsaluba lived during his investigation. He exposed squalid conditions in the residences and told how the streets of the small town were being turned into ghettos with people living up to 20 a house.

Though news of the impending closure was celebrated by neighbour Cindy Howes, it brought misery to the tenants. “At some point she had 22 people living in that house, so I am glad. I have been fighting with Mrs Yekela for years and I am happy that we’ve made some progress. I hope the same will happen with all her other properties,” said Howes.

But one of the tenants, Ngesisa Sotondoshe, a 20-year-old student from Ngqamakhwe, said: “I don’t know what I am going to do. Accommodation is very scarce here and the few places that are available are too expensive for us to afford as students.”

Source: Daily Dispatch

What now for eThekwini’s ANC?

Controversial in life, controversial in death. John Mchunu’s death yesterday was met with shock by some, while others hoped it would usher in a new era in local government politics. Mchunu, who turned 46 last month, was admitted to hospital with pneumonia just before the ANC’s national general council in Durban last month. It is unknown who will take over from Mchunu, chairman of the ANC’s biggest and most powerful region in KwaZulu-Natal, but James Nxumalo, Speaker in the council, is apparently being considered.

ANC leader Cyril Xaba, who was appointed family spokesman, said his death came as a shock because they had assumed he would “pull through”. Mchunu, originally from Impendle, was married to sisters Nonkululeko and Nompumelelo Zondi, and leaves behind six children. Yesterday, family and friends converged on his mansion in Fyfe Road, Westville. Deputy mayor Logie Naidoo expressed his condolences to the family.

The ANC said Mchunu was instrumental in mobilising for the party after its unbanning in 1990 and was known for his outstanding organising skills. Provincial secretary Sihle Zikalala said Mchunu’s departure was a loss to the party and all South Africans. Opposition parties said while they were sad that the ANC and Mchunu’s family had suffered a loss, his death might just be the impetus the municipality needed to start afresh. Cope’s Hlengiwe Hlophe accused him of having been “antagonistic” towards political freedom in the region and said the party hoped that a new era of tolerance and co-operation between political parties could begin.

“There is the matter of the very expensive elephant statues that cost a lot of taxpayers’ money, but quietly disappeared after Mchunu complained about them. This is political intolerance at its most ridiculous. Who will foot the bill for this fruitless and wasteful expenditure? There are also many questions about Mchunu benefiting from city tenders – what will now happen to those allegations? Are they going to be investigated?” she asked.

The DA’s Tex Collins said Mchunu’s influence over municipal manager Michael Sutcliffe and the ANC in the council had been “infinitely greater than it should have been”. Minority Front leader Amichand Rajbansi said while Mchunu had had a great career ahead of him, he had managed to destroy inter-race relations in the city.

Those close to the one-time shop steward were worried that his death would highlight racial tensions within the ANC in the municipality, which was divided between an Africanist camp, on one hand, and whites and Indians on the other.

A memorial service is to be held at the Durban City Hall at 4pm tomorrow and the funeral at Clermont’s Sugar Ray Xulu stadium at 10am on Sunday. Mchunu, an MPL, served as the chairman of the sport and recreation portfolio committee and also as an alternate member of the premier and royal household committee in the legislature.

Source: IoL

Provincial health departments slide R8bn into the red

Provincial health departments had collectively run up a bank overdraft of R8bn by the end of March, according to the Department of Health’s latest annual report, tabled in Parliament on Friday.

It is the first time that the health department has reported this kind of detail on provincial health departments’ financial troubles, and adds weight to its efforts to get the Treasury to try to find a way to bail them out. In June, Business Day reported that officials from the health department and the Treasury were looking into the possibility of providing more money to the provinces after it emerged that they had run up a collective debt of R7,5bn by the end of March last year.

According to the health department’s 2009-10 annual report, the provinces had also reported accruals of R3,2bn, unauthorised expenditure of R11,6bn and overexpenditure of R3,4bn.

Independent economist Alex van den Heever welcomed the details reported by the health department, saying the numbers indicated “a system under massive stress in terms of governance and accountability”. He said the Treasury was more likely to consider an adjustment to the equitable share, which would benefit all the provinces, than a cash handout to those deep in the red.

The health department said it did not have the money to establish a provincial support office as originally planned, but technical assistance from the Treasury had helped improve provincial budget management. Without specifying provinces, it said five out of the nine had stayed within their goods and services budgets, and six managed not to overspend on salaries.

The annual report contains some good news, as it is the first one to receive an unqualified audit opinion from auditor-general Terence Nombembe in seven years. This is an important development, suggesting a significant improvement in the department’s capacity to manage its R18,8bn budget. The department’s poor financial management has for years earned it the scorn of Parliament’s standing committee on public accounts and opposition parties. “It is positive progress,” said the Democratic Alliance’s shadow health minister, Mike Waters. He declined to give further comment until he had read the report.

While the auditor-general’s report indicates he was satisfied that the figures reported by the department were a fair reflection of its finances, Mr Nombembe said it needed to improve its monitoring of conditional grants. These grants are ring- fenced for specific programmes such as improving hospitals, and are channelled from the Treasury to provincial health departments via the national health department.

The health department was supposed to monitor conditional grants with quarterly visits and inspections, and evaluate and investigate inconsistencies arising from these audits, but was failing to do so consistently, Mr Nombembe said. It was also hampered by provinces’ late submission of business plans and performance reports. This has been a concern for several years.

The department reported that it withheld R402m of funds earmarked for hospital revitalisation grants, as some provinces had experienced construction delays. The health department also reported that it had not spent any money on tickets or paraphernalia for the 2010 Soccer World Cup.

Source: Business Day

R2bn left unspent by municipalities

Almost 20% of municipalities — the sharp end of service delivery across the nation — failed to spend even half of their municipal infrastructure grants in the 2009-10 financial year. More than R2bn is lying in municipal bank accounts, rather than tarring roads or building waste water treatment plants. The grants are a main component of the government’s programme for sustainable service delivery at a local level.

Many municipalities have been torn apart by service delivery protests that have seen significant damage to the infrastructure that was in existence. Local government across the country has also been plagued by poor infrastructure maintenance and a lack of capital spending on waste water treatment plants, resulting in a slew of reports about raw sewage being discharged into rivers and streams.

The director-general of the Department of Co-operative Governance and Traditional Affairs, Elroy Africa, in his annual report to Parliament tabled on Friday, said that of the country’s 272 municipalities, 4% had failed to spend any of their infrastructure grants at all, while 15% spent less than half of those allocations. He said that 37% of all municipalities spent all of their infrastructure grant allocations.

Mr Africa reported that R8,7bn was allocated to local government for infrastructure grants projects, and all that money was transferred to the municipalities concerned. But collectively, local government spent only 75% of this, so R2,163bn was left unspent. Only the municipalities in the Western Cape managed to spend 100% of the infrastructure grant funds allocated to them. Councils in KwaZulu-Natal were next best, spending 95% of their allocations, while those in the Northern Cape were the worst, spending 57% of their funds. All the rest of the municipalities spent between 60% and 83%.

The Democratic Alliance’s spokesman on co-operative governance, James Lorimer MP, said: “Whenever there are service delivery protests the government line is that municipalities are under-resourced and services cannot be maintained and infrastructure upgraded because of this lack of cash. The annual report shows it is rather an inability to spend money on things that improve people’s lives that is responsible for the failure to deliver. This inability to spend can be blamed on weak municipal government. The reason for this weakness, in large measure, is cadre deployment. As long as people are appointed on the basis of political loyalty rather than ability, we will have weak municipal governments.”

Mr Africa also noted a further problem in municipal spending, saying that in some cases, where municipalities had their equitable share allocations stopped by the Treasury, they could not fund operational expenditure and as a result used infrastructure grant funding for the day-to-day running of the council. Grant funds are supposed to be dedicated to specific projects and are not for operational expenditure, which should be paid for from equitable share and revenue raised from municipal services and rates.

In April, Co-operative Governance Minister Sicelo Shiceka said his department had audited the backlog in the provision of infrastructure by local authorities and had come up with the figure of R495bn — more than 10 times his department’s annual budget. He said at the time that by April next year the department would set up a special purpose vehicle to control and co-ordinate municipal investment and essential maintenance spending to help local authorities reduce their backlog.

Source: Business Day

Cops Implicated in Murder of Senior Politician

Community activists swamped the KaBokweni magistrate's court on Monday to catch a glimpse of the men accused of executing the corruption-busting speaker of Mpumalanga's capital city, Jimmy Mohlala. Two of the accused are policemen, while a third accused is the mother of the alleged trigger-man.

Mohlala was shot dead on January 4 last year after three gunmen invaded his KaNyamazane home. His 19-year-old son, Tshepiso, was shot and injured. On Monday, bail was set at R10 000 each for the four suspects, who were arrested on Saturday.

The suspects - Jenny Mabika (56) who is a cleaner at Rob Ferreira hospital, unemployed Moses Mahungela (33), and two police constables, Dumisani Mhlanga of the Nelspruit flying squad and Musa Mkhabela of the KaNyamazane police - were not asked to plead to charges of murder and attempted murder.

Mohlala's widow, Bonny, was at the court on Monday to face the four accused. Looking exhausted, Mrs Mohlala told African Eye News Service (AENS) that she was disappointed that the suspects include two policemen. “I am still shocked that the people who are supposed to protect us, are actually the ones who are accused of murdering my husband. Now it explains why it took the police over 20 months to make arrests, because their own are involved,” said Mohlala. She said the arrests, while welcome, were traumatic as the family was reliving the events of Mohlala's murder. “We just want closure on this matter,” she said.

Mpumalanga police spokesman Captain Leonard Hlathi said the suspects were arrested after police received a tip-off. He said the murder charge related to Mohlala's death, while the attempted murder charge related to the shooting and injuring of his teenaged son, Tshepiso. Hlathi said the hospital cleaner is the mother of a fifth suspect who is believed to have pulled the trigger and is still at large. “She is also implicated in this case because we have evidence that she has been hiding (her son) from the police,” Hlathi said. He said the charges against her may therefore be reduced to charges of conspiracy or defeating the ends of justice.

The four accused were able to pay bail and are expected to appear in court again on November 5. Mohlala's nephew, Pat Mohlala, was disappointed at the amount set for bail. “Personally, I am not happy about the bail," he said. "R10 000 is peanuts in a high profile case like this.”

Lawyer for the suspects, Slungu Thobela of Thobela Attorneys, said the State does not have a case against his clients. “The police do not have anything that link my clients to this case, so I don't believe they have a case against them,” said Thobela.

Mohlala was killed a week before he was scheduled to testify about former municipal manager Jacob Dladla's refusal to implement 361 council resolutions, as well as Dladla's role in the poor management of the 2010 Mbombela stadium project. Mohlala was also planning to recommend that fraud charges be laid against Lefika Emerging Equity, the 2010 stadium project managers. A letter dated December 22, 2008, was sent by Lefika on a Mbombela municipality letterhead to First National Bank as surety for an overdraft facility. The letter bears the name of acting municipal manager, Sigananda Siboza. Mohlala and Siboza both claimed the letter was fraudulent.

Source: Capital

Gemballa shot execution-style

The body of German businessman Uwe Gemballa, who disappeared shortly after landing in South Africa in February, has been found, police said on Sunday. "Initially police were investigating a missing person's case. We have now opened a murder docket," Colonel Vishnu Naidoo told Sapa in a telephonic interview.

Gemballa was shot in the head execution-style. His body was found in Atteridgeville, Pretoria, on Tuesday. His hands were bound behind his back. Naidoo said police were waiting for post-mortem results to confirm the body was indeed Gemballa's. "The tests will also help us establish how long he had been dead. We are now trying to establish the motive of the murder. We will only have more details on the matter once the post-mortem results are available." No arrests had been made yet.

German policemen, who were in the country, and local police had been working together to help find Gemballa after he went missing after landing at OR Tambo International Airport on February 8. Gemballa was owner and founder of Gemballa Porsche Conversions, which dealt in Porsches and other luxury sports cars across the globe. "All we know is that he contacted his wife on the 9th (of February) and he hasn't left South Africa. He is missing, basically," Naidoo said at the time. The businessman was thought to have been on a business trip. He was due to leave the country on February 10.

The Sunday Times reported that a close friend, who acted as the family's representative in South Africa, said the family had suspected Gemballa had been held for ransom. A day after arriving in South Africa, a flustered Gemballa called his wife, Christiane, saying he had been involved in a "little accident" and asked her to transfer a million euros (R9.4m) to a bank account, the newspaper reported. She knew something was wrong because he spoke in English, a language they never spoke to each other.

Naidoo could not comment on the Sunday Times report that Gemballa might have been involved in an international syndicate involving alleged money laundering, tax evasion, imported cars stuffed with cash and contract killings - stretching from Switzerland and Germany to Johannesburg. "We do not know anything about that. Right now, we are investigating a murder case," said Naidoo.

Source: News 24

Uwe Gemballa reportedly found murdered in South Africa

News is coming in that the body of Uwe Gemballa has been found in South Africa. Gemballa was the former CEO of the Porsche tuning company that bears his name. As we reported earlier this year, Mr. Gemballa went missing in February after arriving in South Africa for a business trip.

The details that poured in after the reported disappearance of Gemballa caused great speculation that shady business deals were afoot. He was reportedly having trouble paying its employees, his wife was given power of attorney and registered the company for bankruptcy and he had started a second company with his 79 year-old mother listed as the sole stockholder.

To further muddy the waters, it's being reported that Uwe Gemballa was turning towards Czech fugitive and South African organized crime boss, Radovan Krejcir. A former business partner of Krejcirs by the name of Juan Meyer has provided the local police with a sworn statement, saying that the Porsche tuner and the mobster were working on a business arrangement. Gemballa was slow in getting money to Krejcir and it may be what cost him his life.

It's a sad, speculative end for a once famed tuner of German sports cars. The Gemballa company has moved on since Uwe's disappearance but these new stories can't help it as remaining employees attempt to revive the company.

Source: Autoblog

Seventy years since the assassination of Leon Trotsky

This report was delivered by WSWS International Editorial Board Chairman and Socialist Equality Party (US) National Chairman David North to a meeting in Berlin on October 17.

Seventy years, more than two-thirds of a century, have passed since the assassination of Leon Trotsky. In political terms, this is a substantial period of time. It is a platitude to state the obvious: that so much has changed since 1940. The world of Churchill, Roosevelt and Hitler seems—the verb has been chosen with deliberation—to belong to a long-past era. Whether it is really so far behind us is a question that demands very serious consideration, especially when one examines the reception of Leon Trotsky by historians. Whatever else has changed in the world, Trotsky remains an extraordinarily contemporary figure. Even after the passage of 70 years, the passions evoked by his name have not subsided.

Two days after Trotsky’s assassination, the New York Times, in an editorial that welcomed his death, wrote spitefully: “The victims of his cold cruelty … can be numbered in the millions. … It was not enough for him that Russia should be drenched in blood and suffering; the whole world had to wade through a sea of violence so that the triumph of the proletariat could be assured.”

The vitriol of the editorialists who penned those lines can be understood. They feared Trotsky as the greatest revolutionary of their time. He represented a threat to their interests and way of life. They were writing about an enemy whose deeds had shaped the world in which they lived. However, the editorialists could not help but acknowledge the immense scale of their adversary’s achievements:

“He was a powerful writer, an orator who could sway vast crowds, an organizer of sheer genius … It was Trotsky, newly arrived in Russia from New York’s East Side, who took a nondescript, ragged mass of Russians and welded them into the Red Army. He drove every ‘white’ general from the soil of Russia, he broke every Allied attempt to restore the old regime, he gave a semblance of order to a transport and supply system that had been sunk in utter chaos.”

Seventy years after Trotsky’s death, the anger of his enemies has not subsided. In the course of the last seven years, three biographies of Trotsky, by British historians, have been published. The first, by Ian Thatcher, appeared in 2003. The second, by Geoffrey Swain, was brought out in 2005. The most recent, by Robert Service, was published, amidst great fanfare, last year. There is not a trace of historical detachment, objectivity, let alone basic honesty, in these biographies. The authors write about Trotsky as if he were a living political opponent and their personal enemy. Oddly enough, the editorialists of the Times, writing in 1940, for all their politically-embittered anger, were more scrupulous in their attitude toward the facts. They, at least, acknowledged the vast historical role played by Trotsky.

I have spent no small amount of time answering and refuting the books of Thatcher, Swain and Service, which are all shameless exercises in historical distortion and falsification. My essays and lectures on these three authors have been collected and brought together in a book that runs to approximately 200 pages. I am indebted to the Mehring Verlag for having produced a German-language edition of this book. I would like to be able to say that my critique was exhaustive in its refutation of Swain, Thatcher and Service. Unfortunately, I was compelled, under the pressure of time and other responsibilities, to concentrate my attention on only the most egregious of these writers’ falsifications of the historical record.

I had hoped, with the publication of In Defense of Leon Trotsky, that it might be possible to take a welcome respite from the less than pleasant task of answering so-called historians who make a career of falsifying and distorting. Alas, that wish is not likely to be fulfilled. Before my coming to Germany, the comrades of the Partei für Soziale Gleichheit (PSG—Socialist Equality Party) informed me of the decidedly hostile attitude of the faculty of the Department of History at the Humboldt University to the scheduled public lecture of Professor Alexander Rabinowitch on the October Revolution. The department was unwilling to make available a suitable lecture hall, or even formally welcome Rabinowitch’s presence at the Humboldt—if only by inviting him for a cup of coffee.

I was interested to discover the source of the history faculty’s hostility to Professor Rabinowitch’s lecture. Certainly, something more than bad manners was involved. And, as a review of the writings of members of this faculty quickly established, that is most definitely the case.

The online archive of the history faculty at the Humboldt includes a review of Robert Service’s Trotsky by university lecturer Andreas Oberender. He is a junior member of the faculty working under the direction of Professor Jörg Baberowski. Oberender’s work demonstrates, if nothing else, that the contemporary campaign to discredit Trotsky is not a uniquely Anglo-American exercise.

Oberender’s enthusiasm for Service’s biography knows no bounds. He joyfully welcomes Service’s long-overdue demolition of the “myth” of Trotsky’s world-historical significance. As if following a script written by Service himself, Oberender repeats the latter’s dismissal of the renowned Trotsky biographies of Isaac Deutscher and Pierre Broué. These writers were mere “apologists” and “worshippers” of Trotsky.

In contrast, Oberender praises Service as the “ideal biographer” of Trotsky: “Completely above suspicion of any connection to Trotskyism, he possesses the required critical distance to his protagonist…” Oberender fails to consider that Service’s association with the virulently anti-communist Hoover Institute at Stanford University calls into question his claim of “critical distance” and objectivity.

Despite his unqualified praise for Service’s biography, Oberender has nothing concrete to say about it. He does not cite even a single sentence from this supposedly brilliant work. Instead, he devotes almost all of his review to his own vicious denunciation of Trotsky.

Oberender writes, “Without his already early apparent writing and speaking talents he would have merely remained a young revolutionary among many. He had no other means of drawing attention to himself apart from his rhetoric."

How is one to answer such a banal and absurd statement? What would one think of a biographer of Count Leo Tolstoy who wrote, “Without his talent as a writer, Tolstoy would have simply remained a wealthy landowner among many others. Had he not written War and Peace, Anna Karenina, Resurrection, and The Death of Ivan Ilyitch, no one would care about Tolstoy. Except for his skill as a writer, he had no means to call attention to himself.” Yes, how profoundly true!

Underlying Oberender’s diatribe against Trotsky is a bitter hatred of the socialist movement. He continues:

“Trotsky's development hardly differed from that of the typical left-wing member of the radical intelligentsia alienated by the Tsarist regime. The milieu of his socialization was the unhealthy hotbed of fractional in-fighting predominating in the circle of émigrés and editorial boards with their endless scholastic debates over the purity of the Marxist doctrine and the correct path to revolution.” Trotsky, according to Oberender, “never emerged from the suffocating influence of Russian social democracy; the reader looks in vain for any signs of candor and willingness to reach out to other intellectuals and ideological milieus.”

What astonishing ignorance! Trotsky’s activities and influence, before 1917, was not confined to the milieu of the Russian social democracy. He was a major figure in the European socialist movement, well known to all the major leaders of the Second International—including Ramsey MacDonald, the British Fabian and future prime minister. Trotsky spoke and wrote fluently in French and German. He was, at least before 1914, on close personal terms with Karl Kautsky and his articles appeared in Die Neue Zeit. Trotsky was considered an outstanding authority on the politics of the Balkans. As for the range of his cultural interests, not even Service denies that Trotsky wrote on a wide range of intellectual, literary and artistic trends. Trotsky wrote on subjects such as Nietzsche, Ibsen, and the European artistic avant-garde.

Oberender continues: “The adoption and reception of Marxism by the young Trotsky graphically demonstrates what happens when an undoubtedly agile and responsive intellect submits to an ideology, which walls itself within a hermetically sealed conceptual structure and recognizes reality only through the prism of rigid dogma and irrefutable truths.”

Oberender, in a manner typical of vulgar pragmatists, attempts to deride as “dogmatic” those like Trotsky who are conscious of theoretical method and who think systematically. He fails to identify the “rigid dogmas” and “irrefutable truths” that supposedly marred Trotsky’s thinking. Presumably, Oberender has in mind the entire opus of Marxist thought, its foundations in philosophical materialism, and the materialist conception of history. It does not occur to Oberender that his own assertions, laid down without supporting arguments, exemplify the sort of dogmatic thinking of which he accuses Trotsky.

Oberender goes on: “Impartial analysis and objective argumentation were not Trotsky's cup of tea; he was a master of grandiose phrases and abrasive polemics, gifted with the dubious talent of masking the most abstruse and outlandish ideas in dazzling rhetorical pomp. His stylistic excesses went hand in hand with a striking lack of substance and profundity.”

Oberender assumes that his readers are totally ignorant of Trotsky’s literary opus and the immense influence that he exerted through his writings on public opinion. Brecht said in 1931, in conversation with Walter Benjamin and Hermann Hesse, that Trotsky could be justly considered the greatest writer in Europe. And Brecht, it should be noted, was not a political supporter of Trotsky. Any professional academic capable of writing such dishonest and unadulterated rubbish forfeits all right to be taken seriously as a historian.

Trotsky’s writings on European and world politics over a period of nearly 40 years are unequaled in their perspicacity. Nevertheless Oberender continues:

“Trotsky wrote vast numbers of texts in quick succession, assuming the competence to address all manner of issues, with the result that his unrestrained urge to communicate descended into empty verbiage. Significantly, in June 1926 the Politburo called upon Trotsky to rein in his mass production of texts and concentrate more on the posts and tasks given to him by the party.”

Oberender’s sympathies are with Stalin and the rest of Trotsky’s factional opponents in the Soviet Politburo. He fails to note that the Stalinist efforts to censure Trotsky were part of an expanding campaign to silence and legally proscribe the greatest and most popular opponent of the growing bureaucracy.

Oberender descends ever lower. In a ludicrous exercise in counter-factual history, he asks: “What would have become of Trotsky if the Tsarist regime had not collapsed as a result of the First World War? He would have then had to make his way through life as a left radical journalist and aging revolutionary in waiting.”

And what, we might similarly ask, would have happened to Lincoln without the crisis of the union? He would have remained a small town lawyer. Or what would have happened to Luther without the conflict between Rome and the German princes that set the stage for the Reformation? On a somewhat more modest scale, what, one might wonder, would have happened to Frau Merkel without the fall of the Berlin Wall? Oberender asks us to consider, in essence, what would have become of Trotsky if the 20th century hadn’t happened! But, without Herr Oberender’s permission, it did happen, and he is not pleased with the results.

“In times of revolution and civil war he quit his desk in order to agitate among the masses and the Red Army to take up arms against the Whites. His rhetorical and organizational talents, together with his undoubtedly unsentimental approach to the use of violence, allowed him to quickly become one of the best known and most influential party leaders.”

In other words, in the maelstrom of war and revolution, in which millions of people became engaged in massive political struggles, Trotsky emerged as one of the great figures of world history!

Oberender now wants to undo what occurred in history. “What remains from Trotsky and his mystique?... Having read the [Service] biography there can be no doubt that on the basis of a critical examination not much remains of Trotsky's once overblown reputation. His writings belong mostly in a cabinet of curiosities, and the extravagance of his thought strikes one today, in our own non-ideological age, as strange, if not bizarre. The Fourth International he founded is barely a footnote in the history of the workers' movement.”

Mr. Oberender, I understand, was born in what was once East Germany. How would he assess today the place of the Stalinist ruling SED in the history of the workers’ movement? Or, for that matter, that of the Communist Party of the Soviet Union? What remains of these reactionary bureaucratic structures? Trotsky foretold the fate of the Stalinist parties: “Of these reactionary organizations,” he wrote, “not one stone will be left on another.”

As Mr. Oberender indulged in speculation as to what would have been Trotsky’s fate had not War and Revolution intervened, he cannot object when I pose the question: What would have happened to Mr. Oberender had the German Democratic Republic not collapsed? Frankly, I doubt that his life would have proceeded all that differently. A place would have been found for his meager talents somewhere within the academic structures of the GDR. He might have even found a place within the Humboldt University. Indeed, the review he has written of the Service biography could have been published in a Stalinist journal without a single word being changed!

Oberender claims that Trotsky’s writings belong in a cabinet of curiosities, which have no relevance to our times. A strange verdict, coming from a historian—especially one whose specialty, supposedly, is the history of the Soviet Union. To say that Trotsky is irrelevant is tantamount to dismissing the historical significance of what must be counted among the most important events of the 20th century—the Russian Revolution. Is it possible to understand the political strategy that guided the October Revolution without reference to the writings of Leon Trotsky? No serious historian could exclude from his study of 1917 a careful reading of Trotsky’s History of the Russian Revolution, which also happens to be one of the indisputable masterpieces of world literature. Similarly, a study of Trotsky’s Revolution Betrayed remains the essential work not only for historians, but for anyone today who wishes to understand what the Soviet Union was and the origin and nature of the social, economic and political contradictions that led to its dissolution in 1991—a fate foreseen by Trotsky in 1936!

To a degree unequalled by any other writer of his lifetime, Trotsky’s literary work remains extraordinarily contemporary. For all the many changes in the world over the last 70 years, Trotsky dealt with issues, processes and problems that remain with us to this day: the nature of world economy and its relationship to the nation-state; the significance and implications of the global hegemony of American imperialism; and the fragility of bourgeois democracy. Of course, Mr. Oberender does not even provide the title of a single work by Trotsky. But of all his omissions, the most troubling is his failure to even note what must be considered, at least by a German historian, among Trotsky’s greatest achievements: his analysis of German fascism and his impassioned warning of the colossal menace that Nazism posed to the German and international working class.

Does Mr. Oberender believe that these writings, too, belong in a cabinet of historical curiosities? Have these no relevance to our supposedly “non-ideological” age? Even as we meet, a major exhibit on the Nazi regime has been mounted in Berlin’s Museum of History. To this day, German politics and culture is scarred by the Nazi victory in January 1933 and its aftermath. But this victory was achieved by the fascists only as a consequence of the cowardly and irresponsible policies of the Social Democratic and Communist parties, which refused to unite the millions of socialist workers in Germany for a common struggle against Hitler.

Trotsky’s warnings on the danger posed by fascism rank among the most prescient political documents written in the 20th century. They are all the more extraordinary for having been written by Trotsky while he lived in enforced exile in Turkey. Trotsky called for a united front of the working class against the Nazis, and denounced both the SPD’s pathetic subordination to Hindenburg and the Stalinist party’s criminally irresponsible identification of the Social Democracy with fascism. While the Stalinist KPD claimed, with a mixture of demagogy and terrified fatalism, that a Nazi victory would lead quickly to a communist revolution, Trotsky warned that Hitler’s assumption of power would represent a political catastrophe of unimaginable dimensions.

All claims that it would have made no difference if Trotsky had emerged victorious from the inner-party struggle are refuted by the events in Germany. If no other issue had divided Trotsky and Stalin, the collision over Germany was of sufficient historical moment to justify the claim that Trotsky’s defeat had the most tragic consequences.

Permit me to refer to one document written by Trotsky in April 1932, nine months before Hitler’s victory. What would be the appropriate response of the Soviet government to a fascist victory? Trotsky wrote:

“…My relations with the present Moscow government are not such that I have any right to speak in its name or refer to its intentions, about which I, like every other reader and man of politics, can judge only on the basis of all the information accessible. But I am all the more free to say how in my opinion the Soviet government ought to act in case of a fascist state victory in Germany. Upon receiving the telegraphic communication of this event, I would sign an order for the mobilization of the reserves. When you have a mortal enemy before you, and when war flows from the logic of the objective situation, it would be unpardonable light-mindedness to give the enemy time to establish and fortify himself … and thus grow up to the dimensions of a colossal danger.”

Does Mr. Oberender believe that these words, too, belong in a cabinet of historical curiosities?

What assessment is to be made of Leon Trotsky, 70 years after his death? We now have the advantage of historical perspective. We know the outcome of the political conflicts in which Trotsky played so central a role. We know the fate of the Soviet Union, and of the Stalinist regime that came to power on the basis of the political struggle against Trotsky.

The question must be asked: Which perspective was confirmed by subsequent historical development: the Stalin-Bukharin theory of “socialism in one country” or Trotsky’s refutation of the possibility of establishing socialism on a national basis? Which perspective anticipated the trajectory of economic development: Stalin’s autarkic conception of national socialism or Trotsky’s insistence on the primacy of global economic processes?

The history of the Soviet Union, taken as a whole, establishes that the campaign against Trotsky and Trotskyism, which began in the Politburo in 1923, marked the onset of a right-wing and essentially Russian nationalist reaction against the revolutionary internationalist program on which the October Revolution had been based. Within little more than a decade, the expulsion of the internationalists within the Soviet Communist Party developed into an unrestrained campaign of political genocide aimed at the physical extermination of all the representatives of Marxist politics and culture within the socialist intelligentsia and working class.

The Soviet Union emerged from the anti-socialist terror of the 1930s a politically-scarred society. Stalin’s campaign of mass murder, which included the destruction of virtually the entire officer corps of the Soviet Union, abetted the Nazis and facilitated their subsequent invasion. The horrifying human losses suffered by the USSR between 1941 and 1945 were attributable, to a great extent, to the impact of the Stalinist purges. The Soviet victory in World War II could not, in the long run, reverse the disastrous political trajectory of the USSR. All the frantic reform efforts of the Soviet bureaucracy, after Stalin’s death in 1953, developed on the basis of the nationalist program that formed the basis of the Stalinist regime. The system left behind by Stalin staggered from crisis to crisis until its collapse less than 38 years after the dictator’s death. And the form of that collapse—the dissolution of the USSR by the bureaucracy, the conversion of nationalized property into private property, and the transformation of sections of the bureaucracy into capitalist multibillionaires—proceeded along the lines anticipated by Trotsky in the 1930s.

In conclusion, I would like to address the relevance of Trotsky today. What is Trotsky’s place in history? As a writer, orator, strategist of revolutionary insurrection, military leader and political thinker, Trotsky represents the summit of socialist politics and culture in the 20th century. Before 1917 Trotsky elaborated the strategy of the Russian Revolution. During the years of revolution and civil war, he personified the proletariat’s will to victory. And later, in the face of political defeat and isolation, as a hunted exile, Trotsky rose to still greater political and moral heights—as the implacable opponent of the Stalinist counterrevolution and the strategist of the future world socialist revolution.

In a way unequalled by any other figure, Trotsky defined what it meant to be a revolutionary socialist in the 20th century. That Lenin was a towering figure in the history of socialism is beyond dispute. But his life and work are embedded in the Russian Revolution, with all its contradictions. His death in January 1924 came as the reaction against the October Revolution, within the party that he had created, was only beginning to unfold. In the final weeks of his conscious political life, beset with anxiety over the fate of the revolution, Lenin—as documented in his final writings—turned to Trotsky for support. In the struggle against Stalinism, Trotsky’s political work acquired a world historical significance. The Russian Revolution was a great episode in Trotsky's life—an episode in his struggle for the victory of the international working class. Trotsky personified and represented the world socialist revolution. Moreover, in the fight against Stalinism, Trotsky rescued socialism from the abyss into which it had been dragged by the Kremlin gangsters and their political accomplices.

No political tendency that calls itself socialist can define its program, can define its relationship to Marxism today, except through the political conceptions and political struggles developed by Trotsky. The Fourth International, which he founded in 1938, has endured and developed as the political expression of genuine Marxism. Seventy years after his death, Trotsky, the greatest political figure of the last century, remains the most important teacher of socialists in the new century.

Source: World Socialist Web Site