The South African Reserve Bank (SARB) determined that President Cyril Ramaphosa’s Ntaba Nyoni Estate, which owns the Phala Phala game farm, was not “legally entitled” to the $580,000 paid by Sudanese businessman Hazim Mustafa for the purchase of 20 buffalo. However, because the transaction was never completed – Mustafa never received the buffalo – Ramaphosa and Ntaba Nyoni were under no legal obligation to declare the foreign currency under exchange control regulations.
The SARB made it clear in a brief statement issued Monday morning that it would not reveal the full contents of the “private internal” Phala Phala report. Nonetheless, it determined that the matter was of “significant public importance” and thus released its findings.
The SARB investigation lasted nearly a year and included the examination of 15 affidavits, numerous documents totalling hundreds of pages, and interviews with relevant individuals.
The SARB stressed that its jurisdiction was limited to investigating potential exchange control violations “in relation to the foreign currency allegedly stolen from the Phala Phala farm on 9 February 2020.” The SARB stated that any other issues or potential violations of various laws should be addressed by the appropriate authorities.
The SARB determined that there was no completed transaction based on the facts at hand. As a result, the SARB could not conclude that Ntaba Nyoni Estates CC, the entity involved, or President Cyril Ramaphosa violated the Exchange Control Regulations. This conclusion is based on the fact that the transaction in question was contingent on precedent conditions that were not met, specifically the delivery of the animals. As a result, Ntaba Nyoni Estates CC did not have a legal right to foreign currency, as defined in Regulation (6)(1).
It is worth noting that the Public Protector’s office cleared President Ramaphosa of any wrongdoing in the Phala Phala scandal in late June. Acting Public Protector Kholeka Gcaleka did point out, however, that Major General Wally Rhoode of the Presidential Protection Service was not authorised to conduct an investigation into the burglary.
Gcaleka’s investigation did not cover the tax implications of foreign currency exchange controls or address exchange control regulations. Furthermore, the Hawks are still working to complete their criminal investigation into the matter.
