By Chantelle Benjamin

The police’s secret service fund, which may lead to the undoing of suspended crime intelligence head Richard Mdluli, has a long chequered history with allegations of abuse for personal gain during the apartheid era.

These allegations emerged during Truth and Reconciliation Commission hearings.

Allegations about Mdluli’s abuse of the secret service account began to emerge in 2011 and the rumours, rather than dissipating, were given credence following a detailed report documenting in great detail the purchase of luxury cars, overseas trips and payment of family members under the guise of special agent payments.

The report was prepared for the inspector-general of intelligence, Faith Radebe, by crime intelligence employee Major-General Mark Hankel.

Mdluli has denied the allegations.

The fund is estimated to be between R200-million and R600-million.

Inkathagate scandal

The same fund was used during apartheid years to assist in funding the Inkatha Freedom Party’s opposition of the African National Congress, in what became known as the Inkathagate scandal, exposed by the then Weekly Mail newspaper in South Africa and London’s Guardian in 1991.

It was found that money from the secret account was being used to fund rallies, arm and train IFP members, and the money was allegedly being paid with the knowledge of, among others, foreign affairs minister Pik Botha.

Senior researcher at the Institute for Security Studies Dr Johan Burger said the secretive nature of the fund has always created problems when it comes to monitoring.

“Although it is audited by the auditor-general, it functions within an honour system. The AG has to rely on the integrity of people in the system and assume that there is sufficient oversight higher up to ensure that the slips handed in for alleged informers are in fact being paid to the correct people.”

He said the Secret Service Act has provisions prescribing how the fund should be used, but a fund of this nature “will always be open to exploitation”. The problem is that the AG does not have sufficient intelligence clearance to carry out spot checks. Dr Burger said a system should be put in place that would allow officers with sufficient clearance to do occasional spot checks.

Slush fund also a shush fund

However Police Minister Nathi Mthethwa, far from assuring taxpayers that new systems will be put in place to monitor the multimillion-rand intelligence fund, has in fact indicated that the fund is not a matter for public discussion.

It does not help that Mthethwa himself is alleged to have benefitted illegally from the fund, which was allegedly used to fix the wall of his private residence.

On 29 May this year, in reply to a written question from Congress of the People (Cope) asking Mthethwa if a system was in place to monitor the way in which the secret service manages its funds, the minister replied:

“Secret services … is of such a nature that it is in the national interest that the performance thereof is not directly or indirectly made known, and which is funded from an account known as the secret service account …”

The minister continued: “The above questions by honourable member Ms MAA Njobe can unfortunately not be answered without exposing certain covert procedures and methodology utilised by the said intelligence function.”

Dr Burger said the fund has grown considerably since the apartheid era. There is clear evidence that the fund, then called the secret fund, was extensively abused in the 1980s.

Vlakplaas link

According to Burger, the present fund is the same one used for personal gain by notorious former commander of the Vlakplaas security police base, Colonel Eugene de Kock and his former security colleagues.

This emerged in his trial and the TRC hearings.

De Kock was sentenced in 1996 to 212 years in prison for crimes that included murder, kidnapping, assault and fraud.

The 38 years for fraud referred to 66 charges, including insurance fraud, false claims instituted on behalf of fictitious police informers, the false creation of arms caches in order to generate funds, and the use of police to provide a guard service to a private firm.

The TRC found that many of the crimes, including the fraud, were committed with the knowledge of senior officers and politicians. A number of senior officers testified that the money was misused by De Kock and other officers. How much was spent was never revealed.

“There is a lot of evidence from the court case in 1994 and 1995 that the CIO, a counter insurgency unit, abused the funds of the so-called old security branch, using it for personal gain claiming for informants, in particular, and pocketing the money,” said Dr Burger.

Faking right wing threat

New abuse of the slush fund emerged last week in mid-June, when the Pretoria News said it was in possession of a report that showed that senior crime intelligence officials faked a right wing threat to raid the slush fund.

The threat was supposedly facing the ANC’s centenary celebrations in the Free State in January.

Claiming to have detected potential danger, they applied for and received additional money to pay sources who allegedly tipped them off about the plan to attack black people and ANC members.

The article claims that spy masters in North West used information to threaten chaos and violence at the celebrations.

A video was posted on YouTube of a masked man making chilling threats against black people and the ANC – to back up the so-called threat.

Recorded in 2011, the video showed the masked man alongside right-winger Andre Visagie, a former secretary-general of the Afrikaner Weerstandsbeweging (AWB), who formed the Geloftevolk Republikeine (Covenant People Republicans).

The five-page report outlined the methods used and gave the names of those involved – informers and their police handlers – as well as their backgrounds.

A senior national police official said he was “aware” of the scam, adding that some of those implicated had offered evidence in exchange for immunity from prosecution.

North West crime intelligence boss Nick Engelbrecht referred enquiries to Brigadier Thulani Ngubane, North West police spokesperson, who allegedly refused to comment on allegations that the threats had the blessing of senior officers in charge of intelligence police.

SAPS national spokesperson Lindela Mashigo did not respond to a list of questions.

Dr Burger said abuse of the fund for personal gain will continue until the police “tighten up the running of the fund”.

“They need to check claims are properly signed and the money is properly allocated. The problem for security officials is striking the right balance between keeping records and keeping the identity of informants secret,” he said.

“People in crime intelligence who would carry out spot checks would need to have the highest level of classification, and it’s vital that something like this should be put in place.”