On Friday September 15, KPMG International dropped a bombshell, when it announced that it was withdrawing the findings and conclusions contained in the KPMG SA Forensic report into the so-called SARS rogue unit.
The justification for doing so was twofold: that a second partner had not reviewed the report, and that rendering legal opinion was not within the “professional expertise of those working on the engagement”.
Interestingly, KPMG International stated that none of the factual findings in the report were considered incorrect, and the team that prepared the report under leadership of KPMG SA auditor, Johan van der Walt, had not acted in an “improper, inadequate or unprofessional” manner.
The North Gauteng High Court judgment on the so-called spy-tapes matter, delivered on Friday April 29 last year, found that the decision by then acting national director of public prosecutions, Mokotedi Mpshe, on Wednesday April 1 2009 to discontinue the prosecution of Jacob Zuma on 18 charges and 783 counts of corruption, fraud, money laundering, and racketeering, was irrational and set it aside.
In the words of Judge Aubrey Ledwaba, in the concluding paragraph of the judgment:
“Mr Zuma should face the charges as outlined in the indictment.”
Following this judgment, both Mr Zuma and the National Prosecuting Authority (NPA) requested leave to appeal which was denied, with costs, in July last year. Both appellants petitioned the Supreme Court of Appeals (SCA) for leave to appeal, and the court agreed to hear argument in support of leave to appeal, with the proviso that if the court acquiesced, the litigants should be prepared to render argument forthwith.
On Thursday September 14, just one day before KPMG International dropped its bombshell, a full bench of the SCA, headed by Acting Deputy Judge President Mahomed Navsa, heard argument in the matter.
In the opening stages of the hearing both appellants dropped a hydrogen bomb, when they conceded that Mr Mpshe’s 2009 decision to discontinue the prosecution of Mr Zuma was indeed irrational, despite having argued steadfastly for eight years, at tax payers expense to the tune of an estimated R30 million, to the contrary.
That the SCA dismissed the appeal with costs was anticipated, even without the surprise negation of the collective argument of the appellant’s counsel, and the long-awaited prospect of Mr Zuma having the day in court which he has so strenuously avoided, edged closer.
Until, that is, Mr Zuma’s lawyer, Michael Hulley, standing on the steps of the SCA on Friday October 13, noted his intention to make representation to the NPA to motivate a review of Mr Mpshe’s December 2007 decision to serve an indictment upon his client.
Since Shaun “The Sheep” Abrahams would not be reviewing his own decision – part of the reason why Mr Mpshe’s 2009 decision was found to be irrational – once more discontinuing the prosecution would be feasible, provided Mr Hulley could furnish evidence that the prosecution was indeed tainted.
That evidence, according to Mr Hulley, emerges from the events that unfolded on Friday September 15, because although SARS commissioner, Tom Moyane, and KPMG SA’s Mr Van Der Walt stand by the substance of the SARS rogue unit forensic report, the worm of legal doubt has been planted, and as Mr Hulley said, so too has the reliability of the 2003 forensic report completed by Mr Van Der Walt, which formed the basis for the indictment and conviction of Schabir Shaik on corruption charges, and the subsequent indictment of Mr Zuma, been called into question.
The legal cupboard was bare once the SCA dismissed the NPA and Zuma appeals, and the Constitutional Court isn’t an option, because the SCA ruling made it clear: the matter is entirely procedural, and has no constitutional dimension.
This leaves Mr Abrahams with two options: serve the indictment afresh on Mr Zuma, or after
considering Mr Hulley’s representations, set aside the charges on the grounds so conveniently presented by KMPG International, that the report underpinning the prosecution is unreliable.
And what logically follows, is an application for a permanent stay of prosecution.
And it gets worse. If Mr Zuma’s prosecution is challengeable on these grounds, then the indictment, trial and conviction of Mr Schaik, based on the same forensic report, will undoubtedly be taken on review.
All of which raises a couple of questions.
Did counsel for the appellants – the NPA and Mr Zuma – know on September 14 what would unfold on September 15?
Did KPMG International deliberately withdraw the findings and conclusions contained in the KPMG SA Forensic report, in order to furnish Mr Hulley with the grounds he sought to motivate a review of his client’s indictment?