Report urges criminal inquiry into Zuma ties to Gupta family

South African president Jacob Zuma may have infringed ethics laws, and allegations of "state capture" over his ties to the powerful Gupta business family should be criminally investigated, according to an ombudsman report released on Wednesday.

The revelations in the report by Thuli Madonsela, the former public protector, will pile further pressure on senior figures in the ruling African National Congress to push Mr Zuma to step down early, following a dramatic day of protests by opposition parties and civil society groups in Pretoria, the capital.

The report was released to the public on Wednesday only after Mr Zuma abandoned a legal bid to block its publication.

In its politically most explosive finding, the report implicates Mr Zuma in giving the Guptas knowledge of ministerial appointments before he made them, particularly over his firing of Nhlanhla Nene as finance minister a year ago.

"It is worrying that the Gupta family was aware or may have been aware" that Mr Zuma fired Nhlanhla Nene as finance minister after Mcebisi Jonas, the deputy finance minister, told Mr Nene that the Guptas had offered him his job, Ms Madonsela said.

Ethics violation

Mr Zuma’s failure to investigate Mr Jonas’s claims may have violated ethics laws, she added.

The report also uncovers evidence that Des van Rooyen, then a little-known ANC backbencher, met the Guptas at their mansion in Johannesburg seven times in as many days before being appointed as Mr Nene’s replacement by Mr Zuma.

Mr van Rooyen lasted four days in the job, during which time the rand and other South African assets tumbled, before Mr Zuma backtracked and appointed Pravin Gordhan, the current finance minister.

“The coincidence is a source of great concern,” Ms Madonsela added. “Another worrying coincidence is that minister Nene was removed after Mr Jonas advised him that he was going to be removed.”

The report ordered Mr Zuma to set up a commission of inquiry into the evidence of state capture it has uncovered, to be headed by a judge and to report back within 180 days.

South Africa’s national prosecuting authority should also begin an investigation into the allegations of corruption that have been uncovered, according to the report. “It appears crimes have been committed,” it said.

The rand strengthened 1.3 per cent against the US dollar after Mr Zuma withdrew his application to interdict the release of the report. Its publication adds to a week of serious setbacks for Mr Zuma’s authority and will embolden his opponents in a power battle within the ANC.

Fraud charges

On Monday, fraud charges against Mr Gordhan were dropped in a blow for an investigation widely seen as a politically motivated pretext for Mr Zuma to replace him with a more pliant appointee.

On Wednesday the opposition Democratic Alliance (DA) and Economic Freedom Fighters came together to lead thousands of their supporters through Pretoria on marches originally called to defend Mr Gordhan.

Mmusi Maimane, DA leader, told crowds: “Our march today is about letting Zuma, the Guptas, and all their useful idiots know that their days are numbered.”

Religious groups, businesspeople and ANC veterans also gathered at the capital’s St Alban’s cathedral in what was the strongest civil society demonstration against Mr Zuma so far.

Zak Yacoob, a former court judge and anti-apartheid activist, said: "If Zuma resigns tomorrow, we have not won the struggle. There is dirt on the hands of the majority of the working committee of the ANC." The ANC would have the power to ask Mr Zuma to step down, he said. "This is the truth we must face."

In a sign of the ANC's fracturing, Paul Mashatile, chairman of the party in Gauteng province, was among those at the demonstration. Protesters broke out in cheers in the church as they heard of the withdrawal of the application to delay the report.

Some business leaders, however, remained cautious of calling for Mr Zuma's departure outright. Jabu Mabuza, chairman of Telkom, the wireless group, said: "We are not calling for the president to go. We respect the processes in the constitution."

The Guptas and Mr Zuma have denied the allegations against them.

– Copyright The Financial Times Limited 2016