Accountability for Kleptocracy


Main Image Credit Spotlight on corruption: former South African president Jacob Zuma gives testimony to the Zondo Commission in 2019. Image: eNCA / Wikimedia Commons / CC BY 3.0


Corruption investigations in South Africa have energised a citizen-led accountability movement.

South Africa’s judicial commission published the third report of its investigation into state capture on 2 March. The fourth and final report is to be published later this year. The reports, a result of the Zondo Commission inquiry, investigate allegations of corruption, fraud and kleptocratic governance under former president Jacob Zuma that amount to £2.33 billion. Yet while state institutions have been eroded, South African investigative journalism and active civil society have kept kleptocratic activities at the forefront of the national conscience.

Capturing the State

The Zondo Commission has uncovered kleptocracy on an unprecedented scale. Within the nine-year period of Zuma’s presidency (2009–18), state-owned enterprises, including the national airline, South African Airways, and the power utility, Eskom, were bought by external private interests. The report also details Zuma’s issuing of tenders to close contacts. The Jacob Zuma Foundation – the former president’s charity – acted as a front company for the theft and misappropriation of public funds, while KPMG obscured the private appropriation of state funds. Nowhere is kleptocracy more evident, though, than in the former president’s relationship with the powerful Gupta family from India.

When the cabinet minister in charge of the state transport company refused to appoint Gupta-linked chief executives, she found herself dismissed and redeployed as an ambassador to Finland. Her successor is closely linked to the Guptas with transactions amounting to billions of pounds.

The consequences of kleptocracy in South Africa are stark: the national carrier is now defunct and power outages, colloquially known as ‘load shedding’, are frequent. South Africa’s ranking in Transparency International’s Corruption Perceptions Index has decreased by 4 points since 2009: the country scored 44/100 in 2021, and is ranked 70/180 countries.

Words and Weapons

Yet this rise in kleptocratic governance has not deterred journalists from actively investigating power abuses, and seeking to hold officials accountable. Prominent journalists, such as Ferial Haffajee, revealed more than 25 corruption cases directly linked to the Zuma administration. These exposés were used as evidence by the Zondo Commission. Proactive investigative journalism and a public intolerant of corruption led the Gupta family to flee to the UAE in 2016. South African banks and financial institutions have since terminated their personal and corporate accounts, including the South African branch of the Indian-owned Bank of Baroda – the Gupta’s financial institution of choice.

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State capture can constrain the space for citizen-led accountability by limiting regulatory frameworks, tightening controls on information and reducing citizen engagement

The efforts of the Zondo Commission should, rightly, be praised. However, they also draw attention to the value of citizen-led accountability in exposing corruption: an independent judiciary, free press and active civil society have kept kleptocratic activities at the forefront of the national dialogue.

The South African experience can provide lessons for elsewhere in the world. The Russian invasion of Ukraine on 24 February triggered extensive Western sanctions targeting oligarchs close to Putin and the freezing of bank and government assets. When the Rand plunged as South Africa’s credit rating was downgraded to junk status in 2017, citizens took to the streets. Russia, and the close-knit web of oligarchs close to Putin, would do well to heed the impact of citizen-led accountability.

From Local to Global

Citizen-led accountability includes the activities of private citizens that seek to influence public decision-making processes and is an essential part of inclusive governance. State capture, however, can constrain the space for citizen-led accountability by limiting regulatory frameworks, tightening controls on information and reducing citizen engagement. A free press is seen as a major threat by state capture networks. Most captor groups will see control of the media and civil society as a priority to prevent the development of an informed public, which can trigger electoral accountability.

The state can try to intimidate journalists and civil society organisations by withdrawing revenue, targeting their personal safety or paying for their silence. According to evidence provided by a secret witness to the Zondo Commission, African News Agency journalists were allegedly paid £1 million with funds from Project Wave, which was set up to bribe media houses to counter negative publicity against Zuma, and included the direct involvement of the London-based Bell Pottinger public relations firm. This increased political control or influence can result in media organisations being instrumentalised by the government to gradually distort the national media landscape and promote a pro-government narrative.

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It is crucial to continue empowering investigative journalists and civil society organisations around the world, so that they highlight corrupt activity and press for greater transparency and accountability

In recent years, investigative journalism has moved away from the more traditional media houses towards a collaborative movement. This new approach strengthens investigative journalists against any withdrawal from the government as they no longer depend on state funds but use donor funding and grants instead. Collaborations can allow journalists and civil society organisations to follow topics for longer. By taking advantage of the experience from other journalists and activists, they can divide workloads and create a more significant impact in legislation and policy. More importantly, having a global platform can allow for any wrongdoings identified by the investigations to be more widely disseminated, with greater international scrutiny driving domestic change.

Conclusion

Every year, millions of pounds are lost to state capture by the actions of kleptocratic leaders. Once the stolen funds enter the financial system, they are either lost or near impossible to find. All three of the Zondo Commission’s reports detail the serious financial and institutional repercussions of kleptocracy borne by South Africans. In situations of state capture, those tasked with fighting corruption are often the same people who benefit from illicit funds. Therefore, it is crucial to continue empowering investigative journalists and civil society organisations around the world so that they highlight corrupt activity and press for greater transparency and accountability. Only then can we support the global effort to reverse the impunity felt by those that profit from corruption and kleptocracy.

The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.

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WRITTEN BY

Sasha Erskine

Research Analyst

Centre for Financial Crime and Security Studies

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Maria Sofia Reiser

Research Analyst

Centre for Financial Crime and Security Studies

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