[This letter has also been sent to Cosatu, Nactu, Amcu, Corruption Watch, Numsa, Wasp, DLF, Amabhungane for them to take up the matter.]
The office of the Public Protector
Dear Ms Madonsela
Re: Call to investigate complicity and/or negligence of the current and past heads of SARS, The Reserve Bank, The Presidency, Ministry of Finance, Ministry of Minerals and Energy, Trade and Industry and their respective Director Generals over transfer pricing, mislabelling, under-invoicing of exports and over-invoicing of imports, principally by Anglo American, Anglo Platinum, Implats, Lonmin and all other mining companies
It has come to our attention that the above-mentioned present and past agencies, beginning with SARS, including the Presidency, the Ministries of Finance, Minerals and Energy, Trade and Industry and their respective Director Generals, have ignored a long-standing fraud of Anglo American, Amplats, Implats, Lonmin and other major mining companies, of deliberately mislabelling their mineral exports, thereby evading the payment of tax. According to Sam Ashman, Ben Fine & Susan Newman (2011): Amnesty International? TheNature, Scale and Impact of Capital Flight from South Africa, Journal of Southern African Studies, 37:01, 7-25, this practice of the mining companies has been going on for the past 50 years at least. They cite approaches to SARS to take up the matter and record their reluctance to do so. They also cite Susan Newmanís presentation on Systematised capital flight in South Africa (at the 3rd IIPPE International Workshop in Ankara) where she records massive under-invoicing by mining companies in South Africa of mineral exports and over-invoicing by these same companies of equipment imports. The net effect being massive capital flight. She records a simple mechanism of establishing these fraudulent activities, namely recording the book exports of the mining companies in South Africa and matching these with the recorded imports at the destinations. Similarly for the equipment imports by the mining companies. These figures are matters of public record and thus readily available to SARS, The Presidency and the relevant above-mentioned departments and Ministries.
The scale of the theft is in the order of hundreds of billions of Rands, if not trillions. This is excluding the penalties that the mining companies should be paying. It is also on record that SARS has had several periods of amnesty and the mining companies have failed to come forward.
1. The seizure of SARS records on exports and imports by the mining companies and all relevant correspondence between SARS and the mining companies relating to this;
2. The investigation of the heads of SARS, the Reserve Bank, the Presidency, the Director Generals and Ministers of Finance, Minerals and Energy, Trade and Industry, present and past; in particular also present and past functionaries that have either taken up positions on mining companies, such as Tito Mboweni and others, or have family interests in mining such as the current President Zuma;
3. Initiation of steps for the recovery of the assets stolen by the mining companies such as Anglo American, Amplats, Implats, Lonmin, and all others (including interest and fines).
4. The outlining of steps to prevent links between government Ministers and functionaries of government while in office and when they leave office.
In the current dire state of massive unemployment and deprivation, we put it to you that such investigation is not only urgent but a question of life and death. The needs of the masses could all be met overnight if the stolen assets are recovered and if future such practices are resolved. In particular, the question of work for all and the achievement of a R12 500 minimum wage for all workers, not only mineworkers, is achievable if the above steps are taken.
We await your urgent reply.
Workers International Vanguard Party
1st Floor, Community House
41 Salt River rd