Exposed: Top lawyers unmasked for taking dodgy cash 'gifts' from kingpin

How to beat a R600m SARS bill

05 November 2017 - 00:02 By JACQUES PAUW

A prominent Johannesburg advocate and acting high court judge took a bag containing R500,000 in cash as a "gift" from self-confessed tobacco smuggler and fraudster Adriano Mazzotti.
A top criminal attorney who is said to count President Jacob Zuma, his son Duduzane and Energy Minister David Mahlobo among his clients also took R800,000 in cash from Mazzotti.
It is revealed in an affidavit made by Mazzotti that he gave the money to attorney Ian Small-Smith to bribe top South African Revenue Service officials. Instead, Small-Smith allegedly pocketed the money.Small-Smith, a consultant at BDK Attorneys in Johannesburg, has counted among his clients Mahlobo, former acting police commissioner Khomotso Phahlane, Mpumalanga premier David Mabuza, Czech fugitive and gangster Radovan Krejcir and Brett Kebble's killers.
Johannesburg advocate and acting judge Michael Hellens SC this week admitted to the Sunday Times that he took the bag of money from Mazzotti.
The Johannesburg Bar Council found last year that Hellens had breached its rules by not asking for permission to accept Mazzotti's "gift" and reprimanded him.
The Sunday Times exposed Mazzotti last week as a major benefactor of the ANC presidential campaign of Nkosazana Dlamini-Zuma - an allegation he denied. He also sponsored Julius Malema's EFF, enabling the party to contest the 2014 general election.
Mazzotti has emerged as a central character in The President's Keepers: Those Who Keep Zuma in Power and out of Prison.
Parts of Mazzotti's affidavit, which was deposed in May 2014, are published in The President's Keepers.Mazzotti had deposed the affidavit to try to settle a R600-million tax bill.
The book refers to a recording in which Mazzotti boasted about his links to Mahlobo. He claimed that the State Security Agency had asked him to spy on Malema.
Mazzotti discloses in the affidavit that his company, Carnilinx, had obtained Hellens's services to negotiate a dispute with the revenue service.
Before the negotiations took place, Mazzotti said he bribed a SARS official for documents pertaining to the tax authority's investigation into Carnilinx.
The negotiations with SARS were successful, and Mazzotti said that, as a "show of gratitude", Carnilinx had gifted Hellens with R500,000 in cash.
The Johannesburg Bar Council charged Hellens with unprofessional conduct.
In his explanation to the Bar, Hellens said Carnilinx gave him the gift to "celebrate the successful outcome" of his representation to SARS. He had treated it as a donation.
After the negotiations with SARS, Mazzotti celebrated the outcome with his legal team at the Houghton Golf Club in Johannesburg, said Hellens.
"There was much handshaking and back-slapping and congratulations - as there often is when one has been successful in a case. I had two drinks with them. I [bade] ... them farewell and left to go home."He said when he got to his car, Mazzotti caught up with Hellens. Mazzotti had a bag in his hand. Hellens said Mazzotti held it out to Hellens and said: "Here is your money."
"I declined to accept it. He insisted, saying how grateful they were to me. After some further remonstration back and forth, he said: 'Mike, just open your boot.' I did so. When I got home, I confirmed it contained R500,000," said Hellens.
"I never asked for it and never agreed to it until I eventually succumbed to the client's insistence and accepted it."
In his affidavit, Mazzotti said Hellens was wrong to accept the gift.
When the Sunday Times asked Mazzotti about the payment, he denied he had given Hellens an unlawful gift.
Mazzotti also denied to the Sunday Times that he had paid Small-Smith R800,000 to bribe top SARS officials.
In his affidavit, however, he goes into detail about the cash he gave to Small-Smith.
Mazzotti, who describes Small-Smith as a good friend, said in his affidavit that Carnilinx retained Small-Smith because of his "perceived connections" at SARS.
"In our dealings with Small-Smith, the latter persistently referred to his contacts at SARS, and in particular mentioned Johann van Loggerenberg and Ivan Pillay."
Pillay was acting SARS commissioner at the time and Van Loggerenberg the investigations head. It was, among others, the tax collector's investigation unit that nailed Mazzotti and Carnilinx for tax evasion and money laundering.
"We made this large payment to him on the basis of a perception, on our part, that he was using part of these monies to pay off SARS officials, in particular Van Loggerenberg," Mazzotti said in the affidavit.
But Mazzotti concedes they were "misled" into believing that Small-Smith could influence the two SARS officials.
The Sunday Times has established that Hellens and Small-Smith paid donations tax on Mazzotti's "gifts".
SARS, which investigated the two lawyers, discovered further undisclosed amounts of cash that were paid into Small-Smith's account. The revenue service concluded that the amounts came from the police crime intelligence unit and the SSA.
Small-Smith later apologised to Van Loggerenberg and said that Carnilinx, Mazzotti and other directors "were led to believe by my representations ... that I had influence over Johann or any other official at SARS, this was wrong".
Small-Smith denied this week that Carnilinx had given him money to bribe SARS officials. He said there was "nothing wrong with cash payments", as long as they were declared. He also said Carnilinx was wrong to assume that he had any influence over Pillay or Van Loggerenberg.
His interactions with police crime intelligence and the SSA were professional.
It is understood that Small-Smith has been consulting with Zuma on criminal matters. The Presidency did not respond to a request for comment...

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