The National Prosecuting Authority’s Independent Directorate has brought criminal charges against various individuals involved in the looting of the environmental rehabilitation trust funds of the Optimum and Koornfontein Mines. The companies involved, being Tegeta Exploration and Resources (Pty) Ltd, Optimum Mine (Pty) Ltd and Koornfontein Mines (Pty) Ltd, which are all in business rescue, are also facing criminal charges, following funds being pulled out of the environmental rehabilitation trusts and being used in the operations of the mines.
In addition to the charges of fraud and money laundering, they face charges of contravening the Financial Provisioning Regulations, 2015 published in terms of the National Environmental Management Act 107 of 1998. If found guilty, they could face fines of up to R10 million, or 10 years in prison, or both such fine and imprisonment.
Although not mentioned in this article, in addition to the pending charges, there is the risk of punitive tax penalties being imposed if the trusts were formed in terms of section 37A of the Income Tax Act 58 of 1966, since such penalties are imposed where funds are used for anything other than rehabilitation (as appears was the case in this instance).
There are very few prosecutions in relation to funds which are supposed to be set aside as financial provision for mines’ environmental rehabilitation, and this case will be followed with interest.
The story here is how the Guptas, with a hand from Raphela, pillaged the strictly governed rehabilitation trust funds of their Optimum and Koornfontein mines, worth a total of R1,75-billion. The money was not used for rehabilitation of the mining area, but to cover operating expenses of Gupta company Tegeta Exploration and Resources as well as the Optimum and Koornfontein mines.
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