Minister of Finance summonsed for fraud

Pravin Gordhan, Minister of Finance, has been issued with a court summons for fraud by the National Prosecuting Authority (NPA). The announcement was made this morning at a press briefing by NPA head Shaun Abrahams.

The summons is the latest development in the investigation into the ‘rogue unit’ which Gordhan established at the South African Revenue Service (SARS) when he was head of the tax body.

Andre Botha at TreasuryOne, a treasury service company, responded to the ‘shocking revelation’ of Gordhan being summonsed following the ongoing case with the Hawks and the Rogue SARS Unit.

“The timing of everything is rather strange with the NPA declaring last week that there was no case against Gordhan. Could this be the first shot fired with the release of the state capture report by Thuli Madonsela on Friday? Honestly one does not wish so as this could be detrimental to South Africa in the long run, as this would have pricked the ears of the rating agencies and one can expect South Africa to have negated all the good work of the past few months with this,” said Botha.

Not only may this affect the country’s credit rating later this year, but has already impacted the Rand. “The Rand has lost 35 cents in the matter of 10 minutes following the news and it seems that nothing is standing in the way of it moving higher. A higher Rand means higher inflation which means that the SARB (South African Reserve Bank) will have to re-look at their interest rate hiking cycle and more hikes could be in [on the horizon] should the Rand slip to R15 and beyond.”