Legal practitioners must be ambassadors in fighting corruption

July 1st, 2018

Black Lawyers Association’s Deputy President, Baitseng Rangata, said legal practitioners must make sure corruption does not take place around them. She was speaking at the BLA’s national general meeting (NGM) in Nelspruit on 26 May.

By Kgomotso Ramotsho

The Black Lawyers Association (BLA) held its national general meeting (NGM) on 26 May in Nelspruit. The theme for the NGM was: ‘Corruption: A Hindrance to the Development of Black Legal Practitioners.’

Deputy President of the BLA, Baitseng Rangata said legal practitioners were not as clear from corruption as they would like to think. She pointed out that some legal practitioners seek more work contracts than their counterparts and in the process end up committing corruption. She spoke about reports in the news about events that took place in the North West Province when chaos erupted after staff at a hospital went on strike over corruption claims and the collapsing health care system, which they blamed on provincial Premier, Supra Mahumapelo. She added that problems at the hospital in the North West Province sparked up as the resources intended for the people were diverted for personal gain.

Ms Rangata said legal practitioners must do self-introspection and realise the effects that corruption can have on their careers and find ways to make sure that corruption does not happen around them. She pointed out that the BLA went to the streets and protested against the state on briefing patterns, however, she said nothing had changed, because there are still a few individuals who are being briefed and benefiting more than others, as corruption is rife. She added that legal practitioners have to develop proper guidelines to make sure that work is fairly shared among one another.

B-BBEE discussed

Senior manager for compliance at the Broad-Based Black Economic Empowerment Commission (the commission), Advocate Lindiwe Madonsela, said in 2013 the amendments to the Broad-Based Black Economic Empowerment Act 53 of 2003 (the Act) were effected, after former President Jacob Zuma appointed a Presidential Black Economic Empowerment Advisory Council. She noted that the council constitutes of people from the private sector, businesses, as well as organised structures. She added that the council assessed the Broad Based-Black Economic Empowerment (B-BBEE) legislation since 2003 to see if there has been any transformation in the country and focus on what had been achieved since then.

Ms Madonsela said the council came up with recommendations that were tabled in Parliament and also came up with what they called the amended
B-BBEE legislation. She added that the purpose of the amendment was to address namely:

  • Proper monitoring of the B-BBEE legislation: As from time to time there have been various reports from the economy stating that the country is transforming, but other reports raised structural issues. She added that the B-BBEE amendment introduced the B-BBEE amendment commission, as the body that would be responsible to monitoring the issues around economic transformation.
  • Misalignment between various pieces of legislation on issues of transformation: To say that the goal was to transform the economy, why would there be different pieces of legislation that do not speak to one another? Ms Madonsela also highlighted the issue of Preferential Procurement Policy Framework Act 5 of 2000 and also highlighted the issues around the Mining Act 5 of 1998. She added that there was a clause that said, if there was a conflict on issues of transformation between the B-BBEE and any other law, the B-BBEE must supersede.
  • Alignment of the Broad-Based Black Economic Empowerment Amendment Act 46 of 2013 (the Amendment Act) itself and the Code of Good Practice due to anomalies between the two pieces of legislation. She pointed out that the Code of Good Practice came from the Amendment Act and that certain definitions could only be found in the Code of Good Practice, but not in the Act. The process of the amendment was to transfer some of the definitions that were critical from the codes into the Act.

Broad Based-Black Economic Empowerment’s Senior Manager in the compliance division, Lindiwe Madonsela, spoke at the BLA’s NGM in Nelspruit.

Ms Madonsela added that the commission is currently administering two types of strategies, which are –

  • the compliance strategy; and
  • the enforcement strategy.

She pointed out that the compliance strategy was created at the conceptualising stage of the commission. She said there was a realisation that there was no common understanding of what transformation was about. She noted that the reason for this was that people wanted to start implementing transformation, but ended up cutting corners. She pointed out that the commission decided that it needed to educate people on what transformation was about.

Ms Madonsela said that the enforcement strategy was established for those found to be violating the legislation. She added that the commission had the investigating mandate and that corruption in the Amendment Act also defined ‘fronting’. She said that people thought fronting could happen only through ownership, however, it went beyond that. Ms Madonsela noted that the commission had seen issues around mushrooming, which is called opportunistic intermediaries.

Ms Madonsela added that when the commission read a report that highlighted, that black companies are used to acquire opportunities by other companies, who will be the real benefiters and who use black companies as a front. She pointed out that the reason why this was happening, was simply because the legislation made it mandatory for all organs of state and public entities to implement the Code of Good Practice in their core mandate. She said organs of state were required to issue licences and award grants or incentives to companies who were B-BBEE compliant.

Ms Madonsela said there are penalties applicable to organs of state if they have become aware of a fronting element within the supplier. The organ of state needs to report it to the commission and failing to do so, could result in a one-year prison sentence. She added it also applied to companies that audit B-BBEE performance, normally called B-BBEE verification agencies. She pointed out that if an auditor became aware that a company was not properly implementing the legislation, the auditor was required to report it to the commission and if they did not do so it becomes an offence that is punishable by a one-year prison sentence. Ms Madonsela added there are statistics on fronting that indicated that from June 2017 to March 2018 the commission received 334 complaints on fronting alone.

Ms Madonsela pointed out that fronting inherently went beyond colour. She said it also happened within the black community. She gave an example of a black woman being fronted by black men or a black person with a disability being fronted. She said 83,5 % of the cases they received were on pure fronting.

Ms Madonsela said the legislation also speaks on issues of public and private partnerships. She said legislation required that a partnership with a company must be B-BBEE compliant. She added that the legislation also spoke on issues of preferential procurement and the sale of state entities. She said that when she spoke about compliance, she was not referring to a B-BBEE level and added that the commission had picked up that companies can have a higher B-BBEE level, but still not transform. She noted that the commission looked beyond B-BBEE levels and unpacked issues of transformation.

Ms Madonsela gave an example on issues of ownership, she said that the commission became aware that some companies who claim they have black ownership, were not honest. She added that B-BBEE legislation spoke of ownership, irregardless of the percentage one held in the company, there must be access to voting rights. This means that shareholders must be able to exercise voting rights. She noted that in many instances companies would claim they have black shareholders, however, those shareholders would hold no voting rights or their accessible voting rights were limited.

Director in the forensic services division of Sizwe Ntsaluba Gobodo, Alfred Sambaza, said more often than not it is believed that middle to lower management are the ones who engage in corruption.

Does corruption only happen in the public sector?

Director of forensic services at Sizwe Ntsaluba Gobodo, Alfred Sambaza, said corruption is often perceived as a victimless crime but pointed out that there are victims of corruption. He added that there is a perception that corruption only happens in the public sector, and added that if the public sector is corrupted, there is someone who is a corrupter. He pointed out that more often than not it is believed that middle to lower management are the ones who engage in corruption. However, he noted that in a report that was released globally this year by the Association for Certified Forensic Examiners, it showed that company owners or executives are responsible for corruption and fraud.

Mr Sambaza said people should ask themselves what their part in corruption was and whether or not people got tenders in an appropriate manner or bribed police just to get out of an offence. He asked ‘if one lacks integrity, then how will one fight corruption?’ He spoke about legal practitioners and said if a legal practitioner did wrong and it was published in the media, then all legal practitioners were going to be painted with the same brush.

Mr Sambaza added that if a black legal practitioner engaged in acts of corruption, it could lead to a stereotype that all black legal practitioners are corrupt. He told legal practitioners that the fight against corruption should start with them. They should be the ambassadors to fight corruption.

Women taking a stand against corruption

The President of the South African Women in Law (SAWLA), Nolukhanyiso Gcilitshana said the legal profession had been tarnished by financial and behavioural scandals. She added that it had been painted by accusations of power in race, even within black people it was found that women were being oppressed. She pointed out that women were not able to thrive in the legal profession because of corruption, which is in the element of money, but also sexual favours. She noted that at a Law Society of South Africa (LSSA) annual general meeting, there was a report by the LSSA women’s task team that women in the legal profession are exiting the profession for more stable roles, because they were not able to thrive in their current positions.

The President of the South African Women in Law (SAWLA), Nolukhanyiso Gcilitshana spoke at the BLA’s NGM in May. She said corruption hinders development of upcoming black legal practitioners.

Ms Gcilitshana added that it was reported that woman in the legal profession were being abused by their principals, even female law students suffered abuse from the hands of their lecturers. She pointed out that if these female law students do not perform sexual favours, they will not pass exams or even become law graduates. She said that corruption goes with greed and hinders development because development will not be the focus, but the gain after one has done a corrupt deed will be the focus.

Ms Gcilitshana added that corruption marginalises upcoming legal practitioners and women legal practitioners and that their education and aspiration is crushed. She pointed out that corruption creates ‘elite people’, because a certain group of people would be the ones who can only access a certain type of work or access certain places. She said that for some legal practitioners to access those places, they would have to give a bribe or be involved in an act of extortion. She pointed out that upcoming legal practitioners have a challenge, because when they go knock at certain institutions to seek work, they find that the only way to get work is by buying it or in the case of women doing sexual favours to get employed or get ahead.

Ms Gcilitshana said as a result of corruption there is no transformation and that gender transformation in the legal profession will not happen. She added that corruption corrodes the rule of law because the rule of law rests with the jurist and the jurisprudence of the country. She noted that if the rule of law gets corroded, the interest of the people that legal practitioners are supposed to represent are less valued than those of the legal practitioners themselves. She pointed out that it is important that the issue of corruption gets addressed.

Questions addressed

During the question and answer session a comment came from the floor that corruption was looked at on one side. The member of the BLA said the role legal practitioner’s play to perpetuate corruption must be looked at. He added that often when they read about corruption in the context that it is happening in politics, it strikes that many transactions went through by a legal practitioner’s knowledge to avoid being seen or being regarded as a corrupt transaction.

Another member said that when the issue of Black Economic Empowerment (BEE) is discussed, it is spoken of as if it is a formulation of South Africa (SA), where it was not. He added that the BLA must engage sufficiently enough to interrogate the legal instrument that is greasing the legal system and schematic legal arrangements. He pointed out that if SA does not interrogate, it will contentiously clamour attempts to confront, that the BEE is not a South African formulation, but a result of the influence of the private institutions in America.

A member of the BLA student chapter posed a question to the BLA. She asked what the BLA does to help candidate legal practitioners and legal secretaries who receive harsh treatment from their principals and sometimes suffer the abuse at the hands of those principals. Ms Gcilitshana responded that it is a challenge to help the victims of abuse when they are not comfortable to talk about or report the abuse and harsh treatment they receive from their principals. She said that it was because of how the profession and the society covers women with the blanket of shame. She added that when a woman comes forward to report an indiscretion the first thing she is asked is what did she do?

Ms Gcilitshana said it then becomes about the woman and not about the act of abuse the woman had suffered. She pointed out that attitudes and mind-sets needed to change and that women must come forward to report abuse. Ms Gcilitshana added that the legal fraternity and legal organisations such as SAWLA and the BLA must create a platform and a comfortable space for female legal practitioners to be able to express themselves about such matters.

BLA deputy president Baitseng Rangata admitted that the BLA did not have a formal structure that handles such matters, however, she said that the BLA women are available to give support to those who suffer abuse and who are receiving bad treatment from their principals. She appealed to senior legal practitioners to be mentees to the young people and added that mentoring does not mean assisting only with work, but also with social issues.

Attorney Richard Scott gave an update on the Legal Practice Council and the Legal Practice Act 28 of 2014, at the BLA NGM in Nelspruit.

Impact of the LPA on the LSSA and way forward

Attorney, Richard Scott, gave an update on the Legal Practice Council (LPC) and the Legal Practice Act 28 of 2014 (LPA), he said that in April of this year the Rules for the Legal Profession were published for comment by the Natonal Forum on the Legal Profession and the deadline for comment was on 5 April. GN43 GG 41419, 2-2-2018). He added that in July, Minister of Justice and Correctional Services, Michael Masutha, will publish the regulations in the Government Gazette. He pointed out that in August ch 2 of the LPA will come into effect.

Mr Scott said the LPC and provincial councils will call for nominations for the LPC and will take place in October and that the four existing provincial law societies will dissolve and other chapters of the LPA will come into operation. He pointed out that it was agreed that during the transitional period the LSSA will continue to exist from 2018 to 2020. He added that the mission and core role of the LSSA may be adapted to a structure that needs to be created in the future, as well as to continue promoting and representing the interests of legal practitioners to form a counter weight to the regulatory LPC, whose primary function is to protect the public and access to justice among its other objectives.

Mr Scott added that there will be a house of constituents made of 27 representatives in a ratio of nine, where each of the constituents BLA, NADEL and the stats (non-BLA and non-NADEL members) will elect nine members. He noted that the organisation must be done by consensus and that the LSSA constitution was simplified and clearly states that there is to be no dominance over any constituency.

Attorneys Insurance Indemnity Fund’s (AIIF), Thomas Harban told legal practitioners at the BLA national general meeting that under the Legal Practice Act 28 of 2014 the AIIF will continue to exist

AIIF proposal on payment of PI cover

General manager of the Attorneys Insurance Indemnity Fund NPC (AIIF), Thomas Harban, said that under the LPA the AIIF would continue to exist. He added legal practitioners should be aware that a Professional Indemnity (PI) premium is paid by the Attorneys Fidelity Fund (AFF), however, he pointed out that the reality is that the situation had become unsustainable and the AIIF currently has outstanding claims worth R 475 million. He noted that the claims were increasing at a rate of about 16% a year during the past five year period. He said that the board of the AIIF and the AFF board of control accepted the proposal that over a period of number of years, a programme must be implemented where legal practitioners would be called on to start making a contribution to the PI premium.

Mr Harban also spoke about cybercrime. He pointed out that in July 2016 cybercrime was excluded from the AIIF PI cover. However, he said that the AIIF had gone through a process of trying to educate the legal profession through various media publications about legal practitioners falling victim to cybercrime. Mr Harban advised that cybercrime insurance is available in the market for legal practitioners who are interested in having the insurance cover.

Kgomotso Ramotsho Cert Journ (Boston) Cert Photography (Vega) is the news reporter at De Rebus.

 This article was first published in De Rebus in 2018 (July) DR 10.

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