State capture allegations come back to haunt RAF acting CIO
While RAF CEO launches legal bid to overturn his own suspension.
It is not certain that the RAF board realises that the primary purpose of the fund is to 'compensate victims timeously'. Picture: Shutterstock
The Road Accident Fund (RAF) board placed its acting chief investment officer (CIO) Sefotle Modiba on precautionary suspension following allegations that parliament's Standing Committee on Public Accounts (Scopa) was given misinformation about Modiba's departure from the City of Johannesburg (CoJ).
It has also emerged that RAF CEO Collins Letsoalo has lodged an urgent high court application to review and set aside last week's decision by the fund's board to suspend him with immediate effect for insubordination for defying a board instruction for him to attend a Scopa meeting on 28 May.
Letsoalo is alleging the decision is unlawful, irrational, and unreasonable and is requesting the court to order his immediate reinstatement as RAF CEO.
The application is scheduled to be heard next week.
RAF board deputy chair Dr Nomonde Mabuya-Moloele confirmed to parliament's Portfolio Committee on Transport last week that the RAF board had recommended at a special meeting tonight to rescind a decision to place Letsoalo on special leave and to then place him on suspension.
Mabuya-Moloele further confirmed that Modiba had been placed on precautionary suspension with full pay and benefits with immediate effect. This is due to concerns regarding Modiba's previous employment at the CoJ and other matters that are currently under investigation.
ALSO READ: RAF CEO placed on special leave with full pay, as MPs grill fund
Charges 'were dropped' say Modiba's attorneys
Scopa member Patrick Atkinson of the DA said during last month's Scopa meeting that a letter was sent to the committee by Vuyo Manisi Inc Attorneys on behalf of Modiba stating that:
The CoJ decided to withdraw all charges of misconduct against Modiba;
There was a mutual separation agreement between the CoJ and Modiba; and
All of what is stated in the letter is well documented and backed up by concrete evidence that their client, Modiba, did not leave the CoJ with any charges hanging over his head.
Atkinson said the letter further stated that Modiba feels aggrieved because of comments made by Scopa chair Songezo Zibi on a matter that had already been finalised and is inaccurate.
He said the letter urged Scopa to refrain from 'using false information' and committee members not 'to entertain wrong information concerning their client's [Modiba] departure from the CoJ'.
ALSO READ: R25.5 billion deficit over five years — Can RAF afford to pay out claims?
Charges against Modiba 'were not dropped' – CoJ
Atkinson said the reality is that Scopa sought information from the CoJ and he would like to state the facts of the response it received from the CoJ.
He said with regard to the claim that the charges against Modiba were dropped because the CoJ no longer believed he had a case to answer, the CoJ said:
'According to our records, the charges against Mr Modiba were not dropped. He resigned during the disciplinary process.'
Atkinson said the second question from Scopa to the CoJ was whether there was a mutual separation agreement as part of the settlement when Modiba resigned and had the charges dropped.
Atkinson replied that the CoJ said: 'No, there was no mutual separation between Mr Modiba and the CoJ.
'There was a proposal for mutual separation from his [legal] representative, which proposal was rejected by the CoJ representatives. Subsequently, the employer resigned and left of his own volition.'
ALSO READ: Expert accuses RAF of misrepresenting itself and its purpose
'We have been lied to again' – Scopa
Atkinson said the CoJ was further asked if Modiba resigned of his own accord before the disciplinary inquiry could proceed – and since he was no longer an employee there was no longer a reason to pursue the matter any further?
He replied that the CoJ said: 'Mr Modiba resigned during the disciplinary process when the parties could not reach any consensus on mutual separation.'
Atkinson said the issue Scopa has, which is extremely serious, is that 'we have been lied to again'.
'Mr Modiba instructed a lawyer to send us a letter with falsehoods and lies,' he added.
'Now, I think the situation here is that certainly the [RAF] board needs to speak to Mr Modiba and see whether you want to continue to employ him on the basis of a lawyer's letter sent to Scopa which does not attest to the information we received from the CoJ,' he said.
Atkinson also requested Scopa to report Modiba's attorney to the Legal Practice Council.
'In essence, a lie has been sent to this committee under a lawyer's letter under the full knowledge of Mr Modiba and his attorney,' he said.
'So we would ask that that attorney be reported to the Legal Professional [Practice] Council and that [the] letter be subject to an investigation.'
ALSO READ: RAF management muzzled employees during investigations, SIU says
The R2.6bn that left CoJ's coffers
During the Scopa meeting with the RAF in March, Scopa chair Zibi referred to the fact that Modiba had reportedly left the CoJ after facing disciplinary charges related to the withdrawal of R2.6 billion.
He said these funds were later linked to Regiments Capital, a firm cited during the Zondo Commission of Inquiry into Allegations of State Capture.
Zibi pointed out in last month's Scopa meeting that he had asked the RAF for information about Modiba in October 2024 – and with a simple email that took four minutes the committee to draft, it received the response from the CoJ that Atkinson had mentioned.
'The [RAF] board is failing,' said Zibi.
'Vacancies in critical positions, litigation without a head of legal, people in positions who are still trying to find their feet, lawyers who rock up in court to try and overturn a matter and they don't argue it, inability to send a simple email to a previous employer to ask about the appropriateness of an employee, who then proceeds to send a lawyer's letter that is suspect at best.
'This situation cannot continue any longer. It's making a mockery of parliament and its oversight.'
ALSO READ: WATCH: Letsoalo denies misleading Scopa on RAF's state of affairs
Transport department to report on action being taken
Zibi asked Deputy Minister of Transport Mkhuleko Hlengwa, when he next reports to parliament about the RAF, to report on what is being done to remedy this situation.
Hlengwa told the Portfolio Committee on Transport last week that he would be having a meeting with the RAF board this week (the week starting 9 June) on a number of issues.
The Department of Transport stated on Friday that this meeting 'will evaluate the prospects of the current board to restore good governance and effective administration at the entity so that it fulfills its primary purpose of compensating road accident victims timeously'.
'The department will consider appropriate interventions post this meeting to ensure the stability of the entity, good governance, and the fulfilment of its mandate.'
This article was republished from Moneyweb. Read the original here.
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