Business Practices Committee Report 80

Mthombeni attended the meeting of the Committee held on 26 May 2000. He again answered all the questions put to him, apparently to the best of his ability, it was arranged that Mthombeni address the Committee at 11h00, but he informed an official of the Committee during the morning that he experienced some difficulties and that he would be late for his appointment. He did, however, fax two documents to the Committee during the morning of 26 May 2000. One of the documents was typed and the other written by hand.

Both documents were rather confusing and it was not clear what Mthombeni wanted to convey to the Committee. He appeared to justify the use of Propalux funds for his own purposes because Propalux "owed" him money. He wrote in the handwritten document that he paid R133 000 for Propalux and "... next R90 000".

Referring to the investigation by the Committee, he wrote:

"So for me the above investigation is a help to correct and remedy other problems that should follow in future. The problems that Propalux has is not other members/directors or affiliates it is Mthombeni. I am absolving them for any blame or damage in the affairs of Propalux. So, Propalux (ineligible) is a one man show. I will be very much appreciative to dissolve this company but with a mechanism to fulfill the obligations of the public. I am a responsible citizen, I have not harmed anyone in the past, also not wish to harm anyone in the future. My solution is to be enabled to change the Propalux 46 Ltd convert it back to private with one director to enable us for speedy refunds and some (ineligible) relaxation of about 3 months of a certain target of income".

He also said:

"I must say it under certainty that the company have enough assets to refund all the monies, but it will cause a lot of jeopardy/harm to its members. It is advantageous to keep those assets and strategies of generating the income from all these"

and

"The company at certain times was unable to pay its costs. There was no money in the bank accounts of Propalux 46 Ltd. First account the cheques bounced and fixed costs/commitments have to be fulfilled. The status quo challenged the authority of the leader. Then he brought in a formula that would help alleviate the situation. However, there is still a problem as the company overall financial status would be on a minus until it starts selling. So it is difficult to predict a positive until all properties have appreciated. These explanations are made to the Committee with a trust of bringing of a working solution".

The difficulties experienced by the Committee and the investigating officers in attempting to decipher Mthombeni’s written documents were not solved in the interview. Another example is the following passage from the handwritten document:

"The company Propalux/LM Fibas or LM Mthombeni have got ongoing lease payments. They have 3 cars on hire purchase agreements. They have two houses and mortgage bonds; have got staff and people to look after. Has been a very effective participant in the business world; the owner is busy concluding his marriage with a very dynamic international lady who is going to be an asset to our SA business world. Have advertised to train and employ people for his new factory; if his nearly ±10 000 followers are left the potential to useless activities will effect the country. His ability to create and generate job opportunities".

On 29 February 2000 the Committee resolved to undertake a section 8(1)(a) investigation into the business practices of inter alia Phalatse Stephen Khaole, Letta Sesinyana Langeni, Jafia Matlapeng Letsoela, Maletsatsi Wilhelmina Makgapa, Samuel Mantshi Mofokeng, Modishi Johannes Mokwana and Ellen Nthabiseng Skosana. These persons were no longer directors of Propalux and were thus omitted from Notice 1271 of 2000 in Government Gazette 20994 of 24 March 2000. In the same notice the name of Daniel Tjelele was added to the list of Propalux directors. The Committee resolved to confirm the omissions of the names from and the addition of the one name to the original names mentioned in its resolution on 29 February 2000.