Broke Prasa to pump R1bn into bank that helped Zuma ‘pay back the money’​

Cash-strapped Prasa is investing R1-billion with the bank that lent President Jacob Zuma R7.8-million to “pay back the money” in the Nkandla  scandal.

This is despite the bank not meeting the state entity’s investment requirements and the Passenger Rail Agency of South Africa (Prasa) itself struggling financially.

The Sunday Times has seen correspondence from Prasa’s former acting CEO Lindikhaya Zide confirming the state entity’s commitment to a R1-billion investment with a return of 8.25% per annum.

“We intend to commence with an investment of R1-billion only,”  Zide wrote in a letter to VBS.

The Sunday Times has also  reliably learnt that VBS sent Prasa a letter this week reminding it to effect payment of the first tranche by close of business on Friday February 2.

The state entity’s acting chief financial officer has refused to release the funds despite immense pressure to do such.

An  insider at VBS confirmed it was expecting a payment from Prasa by Friday.  “Prasa had agreed to invest R1-billion and it will come in two tranches and the first payment was expected before the end  of business  on Friday,” said the source.

“We are not being used as a conduit for any corrupt activities, this is a pure investment and it will be monitored by the National Treasury and the Reserve Bank. Prasa will get value for their money. This is not money intended for Zuma or the Guptas, it is pure investment,” said the VBS official.

Despite all the documented proof, Prasa this week denied that the deal had been concluded.

• Read the full story on the Sunday Times website