[DEBATE] : (Fwd) ANC retains Niehaus' 'good brain'

[Patrick Bond]

Tearful Niehaus admits fraud
CAPE TOWN, SOUTH AFRICA Feb 13 2009 07:51

He has been entrusted by the ANC with the strategic job of spokesperson. 
But Carl Niehaus has left a broad trail of bad debt and broken promises 
behind him.

Confronted this week with allegations that he owed hundreds of thousands 
of rands to politicians and influential businessmen and committed fraud 
while working for the Gauteng provincial government, a tearful Niehaus 
admitted that he:

* Forged signatures while he was chief executive of the Gauteng Economic 
Development Agency (Geda) before resigning in December 2005;
* Borrowed money over a six-year period from some of the brightest stars 
of the ANC and business galaxy, much of which he has not paid back;
* Asked to be connected to Brett Kebble because he was “desperate for 
financial help”;
* Had to leave a top job at Deloitte and Touche in 2003 after his 
financial woes became embarrassing;
* Owed the Rhema Church more than R700 000 when he was asked to resign 
from his post as chief executive and spokesperson by a full board 
meeting in 2004; and
* Had to repay R24 000 to director general in the presidency Frank 
Chikane when he left his job there under a cloud in 2004.

Niehaus, appointed ANC spokesperson in November 2008, also admitted to 
using the Rhema Church’s travel agent to book a holiday for himself and 
his wife in Zanzibar and to using the presidency’s travel agent to book 
flights and a trip to Durban for his former wife.

But he denied allegations by his co-workers at the time that he intended 
to pass off the trips as work expenses. He disputed accounts that he 
left the presidency amid claims of financial impropriety and ran up 
implausible expense accounts at Deloitte.

Among those he asked for financial assistance from are Arts and Culture 
Minister Pallo Jordan, ANC empowerment magnates Saki Macozoma, Tokyo 
Sexwale and Cyril Ramaphosa, Absa chair and former deputy governor of 
the Reserve Bank Gill Marcus and mining tycoon Rick Menell.

When powerful friends could not rescue him from what he described as 
“the devastation of debt” he drifted into seemingly outright criminal 
conduct.

In 2005, after just seven months as Geda chief executive, responsible 
for handling millions of rands of transactions, he wrote a fraudulent 
letter and forged the signatures of then finance minister and now 
Gauteng Premier Paul Mashatile, transport minister Ignatius Jacobs, 
education ministerand now ANC Women’s League president Angie Motshekga 
and agriculture minister Khabisi Mosunkutu.

The letter was intended to secure a loan for Niehaus from a businessman 
who hoped to use it to ensure favourable treatment from the Gauteng 
government on property deals.

Niehaus confessed this fraud to Mashatile, who told him to quit or face 
a disciplinary inquiry. Niehaus resigned on December 9 2005.

Told this week of a long list of former employers and creditors who told 
the Mail & Guardian about their dealings with him, Niehaus broke down.

“Most of what you’ve confronted me with is true. I wish it wasn’t. I’ve 
made massive mistakes and I’ve disappointed a lot of people terribly. 
I’ve no illusions that if you publish this article it will mean the end 
of my career,” he said, weeping.

“I asked people like Saki Macozoma, Cyril Ramaphosa, Tokyo Sexwale, Gill 
Marcus, Pallo Jordan and Rick Mennell to help me financially.

“I was down and out. Some of them gave me money and some didn’t. I am 
terribly indebted. I also received money from Brett Kebble,” Niehaus said.

Niehaus said he asked Macozoma to introduce him to Kebble. “I asked for 
the meeting. Saki was my friend and I asked him to help me out. I asked 
to be introduced to Kebble and I met him three times.

“Kebble gave me R70 000 for communications work. He still owed me money. 
I’m paying R100 000 back because I can’t fight the liquidators -- there 
was no contract, only a verbal agreement. I can’t prove anything and I 
don’t have the money to go to court,” he said.

Niehaus is locked in a battle with the ANC’s other spin doctor, Jesse 
Duarte, who is said to be extremely unhappy with the circumstances of 
his appointment.

Party insiders say he was headhunted for the role by ANC secretary 
general Gwede Mantashe, angering Duarte, the incumbent. She is 
understood to be reluctant to stay on after elections.

Those who have worked with Niehaus over the past 14 years and lent him 
cash to fund his and his former wife, Linda Thango’s, extravagant 
lifestyle say they are not surprised things turned sour.

Niehaus has always “over-promised and under-delivered”, they say.

Over the past decade he has resigned from most jobs under pressure or 
earlier than his contract stipulated because of debt or unhappiness with 
the management of his financial affairs.

Niehaus became a household name when, as an anti-apartheid activist, he 
was found guilty of high treason and sentenced to 15 years in jail in 1983.

He became Nelson Mandela’s spokesperson in 1994 and was then ambassador 
to The Netherlands.

On his return to South Africa he briefly worked at the NGO Nicro before 
his relationship with Mandela helped him secure a job at audit firm 
Deloitte and Touche in Gauteng and in The Netherlands.

While at Deloitte he was embroiled in legal action after failing to 
honour an offer to purchase an expensive house on Prinzen Gracht, one of 
Amsterdam’s most prestigious addresses. The penalty for cancellation was 
more than R1-million. This debt sent him into a financial tailspin.

“I felt I had to resign because Deloitte have strong ethics around their 
partners -- they must have their financial dealings order,” Niehaus said.

A former partner at Deloitte, who asked not to be named, said Niehaus 
was “always” in financial crisis and that the Prinzen Gracht debacle had 
not led to his ousting.

“He borrowed money from partners at Deloitte. He also asked me for money 
but I told him I’m not a bank.

“He once booked a helicopter to fly from Sun City to Johannesburg at 
huge expense. He claimed to have lost his credit cards on at least two 
occasions [when improper expenses appeared on the statement] and asked 
people to help him out [with hotel bills]. He also knew somebody in 
Nedbank who helped him out.

“He insisted on a huge salary -- more than others on the same level. We 
paid him because he promised to bring political work to the company. 
That didn’t materialise.”

Another source, also a partner when Niehaus worked at Deloitte, said 
that when Niehaus resigned the firm wrote off large sums he still owed.

Chief executive Grant Gelink said: “To the best of my knowledge Niehaus 
didn’t owe Deloitte any money when he left, but I don’t know if money 
was written off. I wasn’t CEO at the time.”

Niehaus denied owing the company money, adding: “I don’t recall ever 
claiming money from Nedbank because of a stolen card.”

On the Sun City helicpter flight he said he had addressed a conference 
at KwaMaritane and had to be in Johannesburg an hour later “for the 
launch of the strategic communications division. The CEO questioned me 
months later about this expense and accepted my explanation.”

He said he had borrowed money only from one Deloitte partner and had 
“paid it back in full”.

Niehaus’s financial troubles deepened when he divorced his wife and 
co-accused in his terrorism trail, Jansie, and married Linda Thango.

Four sources who worked closely with him after 2002 said Thango, a 
former non-executive director of African Media Entertainment and 
management consultant, was central to his extravagant lifestyle.

“His wife wanted all the best toys: holidays, jewels, clothes, shoes and 
shopping, shopping, shopping. Carl got sucked into that lifestyle, loved 
it and lived way beyond his means,” said one of his former ANC bosses.

Others said he had always been attracted to the trappings of wealth, but 
that Jansie had kept a tight rein on the family finances. Niehaus 
himself insists that he must take responsibility.

He said: “I never said no [to Linda]. I thought this is the way you keep 
love -- you buy it. I should have been firm and said: ‘No more. We can’t 
live like this.’ I didn’t and I fell into the devastation of debt.”

After his departure from Deloitte Niehaus was “rescued”, as one 
government official put it, in 2004 by a job in the presidency working 
on celebrations planned for a “decade of democracy”.

A top presidency official who oversaw his work said: “We terminated his 
contract early because he didn’t complete the work he was meant to do. 
He turned out to be inefficient. He himself felt he had to leave -- 
there was no fight.”

The official added: “He took his wife to Durban and used the 
presidency’s money to pay for the hotel. We told him that’s unauthorised 
expenditure and you need to pay it back now.” Niehaus denies his 
contract was terminated prematurely, adding that he does not remember 
the Durban trip.

“I worked there and finished my contract. I was paid a R24 000 advance, 
which I paid back to Frank Chikane.

“I suppose it’s not impossible that I went to Durban during that time, 
because my wife’s mother lived there,” he said. After leaving the 
presidency in mid-2004 Niehaus was appointed Rhema Church chief 
executive and spokesperson.

He admitted to being asked to leave Rhema after working there for four 
years “because of a disagreement about the size of my loan with the 
church, among other things”.

Rhema continues to insist that he left amicably and there were no 
financial irregularities.

“[Church leader] Ray McCauley organised a staff loan for me. They bought 
me a car and agreed to pay a large amount to [the seller of the Prinzen 
Gracht house].

“The financial officer and I increased this loan a number of times and 
Ray was very unhappy because it was not done with his knowledge. I 
resigned,” Niehaus said.

Niehaus also confirmed using Rhema’s travel agent to book a holiday in 
Zanzibar. While employed by the church he bought himself a Porsche and a 
C-Class Mercedes Benz.

Rhema gave Niehaus six months to repay R700 000. Mashatile’s offer to 
him to head Geda was, therefore, a lifesaver -- which he admits abusing.

On the fraudulent letter in which he forged the signatures of senior 
Gauteng government officials, he said: “Pierre Swart managed a company 
called Blue Label, which offered to lend me the money to repay the Rhema 
debt. I was absolutely desperate, because if I didn’t repay it I 
would’ve had to sell the townhouse in my wife’s name that I had given as 
surety.

“But there was a hook. In exchange for the loan they wanted a letter 
committing various provincial ministries to favouring them when they 
wanted to rent, sell or lease government buildings in the Johannesburg CBD.”

Buildings sold with lease agreements in place are worth much more than 
empty structures, a developer told the M&G.

“I was very desperate but what I did was terrible. After I wrote the 
letter and handed it over I immediately knew that I had done the worst 
thing in my life.

“I went to see Mashatile. I confessed that I’m deeply compromised and he 
was deeply disappointed. I resigned immediately.”

Former Gauteng premier and now Congress of the People leader Mbhazima 
Shilowa confirmed Mashatile told him that Niehaus was asked to leave 
over “financial impropriety”.

Blue Label has major contracts with Vodacom and Telkom. The company made 
no comment.

Said Niehaus: “The ANC job is a lifesaver for me and things have gone 
wrong now in a terrible way. I have to be trustworthy to do my job. I 
live under no illusions about what this article can do to my life. I 
wish I could turn back the clock.”

***

Disgraced ANC spokesman admits to serious fraud

February 14, 2009 Edition 1

Staff Reporters

Disgraced ANC spokesman, former jailed activist and post-1994 MP Carl 
Niehaus, who has confessed to committing serious fraud, stopped at 
nothing to fund an opulent lifestyle, including making a false claim 
that his sister had died.

Yesterday, as the DA called on the ANC to fire Niehaus and for the 
Gauteng government to charge him, it emerged Niehaus lied to a law firm 
to get it to pay for a return business class air ticket to London for 
his former wife, Linda Thango.

After a damning expose in the Mail and Guardian yesterday in which he 
confessed to fraud, serious financial problems and a string of broken 
promises, Niehaus tearfully told Talk Radio 702 that he had tendered his 
resignation to the ANC.

Yesterday the ANC announced it would retain him but remove him from its 
communications section.

ANC secretary-general Gwede Mantashe said the organisation had urged 
Niehaus to seek counselling to "rebuild and reconstruct his life".

Mantashe said the ANC did not want to "destroy a good brain", adding 
that the party wanted to preserve Niehaus's skills.

Yesterday afternoon, as the ANC announced it would retain him but remove 
him as spokesman, the DA called on the ANC to fire Niehaus and for the 
Gauteng government to charge him.

ANC secretary-general Gwede Mantashe said the organisation had urged 
Niehaus to seek counselling to "rebuild and reconstruct his life".

Justifying the ANC's decision to retain Niehaus, Mantashe said: "My 
emphasis is on a cadre of the movement who suffered a great deal because 
of ANC activities, that is not justification to do wrong things, but it 
imposes responsibility on the movement to counsel such cadres," Mantashe 
said. "He has a sharp mind, quite intelligent and has a wealth of 
experience ... there is no dustbin for activists."

However, Mantashe claimed that Niehaus only disclosed his financial woes 
after he was quizzed by the party, and not before his employment.

"I can confirm that we raised questions with him after we employed him 
on a number of issues … that's why, when the article was published, we 
did not run for cover, we knew some of these things."

Mantashe said the revelations were aimed at damaging the ANC in the 
run-up to the election.

Yesterday, it emerged Niehaus lied to a law firm to get it to pay for a 
return business class airticket to London in 2004 for his second wife, 
Linda Thango, allegedly to attend his sister's funeral.

Caught

Niehaus said he couldn't recollect the event, however, he was apparently 
caught out when well known legal firm AL Mostert & Co arranged flowers 
in sympathy for Thango when she returned.

Thango, who was employed as Niehaus's secretary at his insistence, gave 
the game away.

When Niehaus was confronted, he confessed and was immediately fired.

Yesterday, Tony Mostert, who had paid Niehaus R100 000 a month as a 
consultancy fee, said he had been "dreadfully disappointed in the man's 
total lack of ethics".

Niehaus had many other high profile jobs after resigning as an ANC MP 
and South African ambassador to the Netherlands.

At one stage he worked for audit firm Deloitte and Touche but left when 
he was embarrassed by a property deal that fell through in the 
Netherlands. Debts to the company were apparently written off.

In 2004, he left his position as chief executive of the Rhema Church 
owing the church R700 000 for luxury vehicles he had bought, as well as 
using church funds to go on holiday with Thango to Zanzibar. Rhema 
spokesman Vusi Mona said Niehaus has repaid his debt to the church.

Yesterday, DA MP Motlatjo Thetjeng said unless Mashatile acted against 
Niehaus the DA would charge the premier under the Prevention and 
Combating of Corrupt Activities Act for not reporting the matter to police.

But Mashatile's spokesman, Simon Zwane, said the province regarded the 
matter as closed.

Niehaus would not disclose his total debt last night, saying only that a 
group of business people working together with the ANC had been put 
together to help him manage it.

***

ANC is falling apart
Niehaus scandal the latest blow for crumbling party

February 14, 2009 Edition 1

Bronwyn Gerretsen and Staff Reporters

OPPOSITION parties and political commentators are united in their 
opinion that the resignation of ANC national spokesman Carl Niehaus 
yesterday after admitting to fraud is yet another sign that the once 
mighty organisation is falling apart ahead of the general election on 
April 22.

This comes in the same week that ANC Youth League president Julius 
Malema was forced to write an apology to education minister Naledi 
Pandor after he said "she must use her fake accent to solve our 
problems" while addressing striking students and staff at the Tshwane 
University of Technology.

He was also reprimanded for commenting that president of the IFP, Prince 
Mangosuthu Buthelezi, was like "dictator Robert Mugabe".

The bitter in-fighting in the party started on June 13, 2005, when 
then-president Thabo Mbeki fired his then-deputy Jacob Zuma after Judge 
Hilary Squires sentenced Zuma's close friend and financial adviser, 
Schabir Shaik, to 15 years in jail for corruption and fraud.

Zuma had his revenge when Mbeki was ousted as president of the party and 
Zuma replaced him at the national ANC conference in Polokwane in 
December 2007. Mbeki became a "lame duck" president until he stepped down.

President-in-waiting Jacob Zuma still faces charges of fraud, 
corruption, money laundering and tax evasion.

Since then there has been a steady purging of provincial premiers and 
other officials seen to be pro-Mbeki.

Late last year the party suffered its biggest blow yet when two of its 
most senior members, Minister of Defence and ANC chairman Mosiuoa Lekota 
and Gauteng premier Mbhazima Shilowa, resigned and formed what is likely 
to be the new official opposition, Congress of the People (Cope).

Reacting to the problems in the ANC, Ian Davidson, chief whip of the DA, 
said after yesterday's scandal surrounding Niehaus topping an 
ever-growing list of crises affecting the organisation, the DA believed 
that the ruling party had already crumbled too far and as such would not 
be able to resurrect itself.

"I don't think the ANC can pick itself up out of this," he said. "The 
party is not held together by a value system.

"It is a matter of who can milk the system to the best possible degree."

Political analyst professor Adam Habib said it took 90 years for freedom 
fighters to build the liberation pedigree of the ANC and today's leaders 
a mere 15 years to destroy it.

He said the inability of the party's leaders to withstand the temptation 
of political office and the power that came with it was just one dilemma 
the party faced, adding that this was evident in not only the Zuma camp, 
but the Mbeki camp too, starting with the implication of members in the 
arms deal.

Independent Democrat leader Patricia de Lille said that in the ANC 
today, we are witnessing a complete erosion of the values and vision 
that the party fought for in the struggle against apartheid.

"People are no longer in positions of power to serve the nation and to 
make sure that they achieve the vision and values that the ANC fought 
for," she said.