The oil transactions, subsequently dubbed Oilgate, involved the state-owned entity (SOE) the Strategic Fuel Fund (SFF), a wholly owned subsidiary of the Central Energy Fund (CEF), who sold the crude oil to three businesses, two of which in turn sold the oil to other companies.
The 166-page judgment overturned the sale, which means that South Africa gets its oil back. But in a complicated calculation, South Africa must both refund the sale price plus pay additional costs tofor some of the parties involved. The oil was sold for $280 830 970 (worth R3.317 billion in March 2018 when the case was launched and R4.313bn at current rates) and SFF must now pay $420 802 481 (R6.463bn) in restitution and compensation to get it back.
There are hard lessons to be learned from this case. In summary, OUTA says the oil deal should be considered organised crime and prosecuted as such. All those implicated in illegality – particularly the then acting CEO of the SFF, Sibusiso Gamede, who engineered the deal, as well as the then Minister of Energy Tina Joemat-Pettersson – should be prosecuted. Remember that Joemat-Petterssoen was also linked to the unlawful Russian nuclear deal – why is she still in a senior position in Parliament?
OUTA would like to see civil lawsuits against those implicated, as well as criminal prosecutions of all who benefitted from the proceeds of this crime.
The Oilgate scandal perfectly illustrates the massive failure of corporate governance, not just by one or two people but by a wider group. These were strategic stocks and should have had better safeguards, and governance standards are clearly inadequate.
Taxpayers cannot be expected to pay the costs of such illegal deals by SOEs – in this case the money lost to corruption is gone, but we will foot the bill for the additional costs of restitution and compensation. Yet, we will continue to do so – unless we demand higher standards for ministers, and SOE directors and executives.