Brett Kebble and the twist of 'slush fund' intrigue in South Africa's murder mystery

Jason Nissé on the fraud and tax charges, and unanswered financial questions, that hung over a tycoon at the time of his killing
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The Independent Online

Two private jets, a fleet of Ferraris, a fraud investigation, a 1.5bn rand (£130m) slush fund and a eulogy from President Thabo Mbeki's right-hand man are among the legacies of the murdered mining magnate Brett Kebble.

The controversial South African businessman was gunned down in his Mercedes while driving to a friend's house in Johannesburg 12 days ago. He was just 41.

At his funeral last week, senior ANC minister Essop Pahad gave the eulogy in front of a thousand mourners at St George's Cathedral in Cape Town. He attacked the press for publicising fraud allegations about Mr Kebble, who had been a generous donor to political parties and the arts.

However, the facts that have emerged about Mr Kebble's financial dealing and lifestyle have shocked the South African business community. At the time of his murder, he was facing an investigation into allegations of fraud and tax evasion.

Mr Kebble had been at the forefront of South African business for 14 years since buying a controlling stake in a small gold-mining business with his father, Roger. His highest-profile deal came in 1995 when he joined with ANC activist turned businessman Mzi Khumalo to take control of JCI, one of the most famous companies on the Johannesburg market.

He fell out with Mr Khumalo, who quit JCI in 2000, and, in the past few years, his companies sank into more and more financial difficulty, despite the boom in natural resource prices.

At the end of August, he was forced to stand down as chief executive of three South African companies: JCI, Western Areas and Randgold & Exploration (R&E). A month earlier, JCI and R&E had been suspended on the Johannesburg Stock Exchange for late filing of accounts, just a few days after R&E had been rebuked by Nasdaq in the US for the same offence.

Western Areas was recently forced to raise R730m from investors to stave off a financial collapse, and JCI has been in talks with its banks about its financial position.

Regulatory filings by R&E have revealed that large sums of money had been channelled from the mining group into private companies controlled by Mr Kebble and a few close associates. These firms were described in South Africa as "slush funds", with R1.5bn at their control. At the same time, another company, which was under the control of JCI, had run up borrowings of R1.5bn, yet JCI's accounts recorded debts of just a third of that.

On top of this, there is a question mark over 14.4 million shares that R&E is said to hold in Randgold Resources, its UK- listed sister company, which failed in its bid for Ghanaian gold miner Ashanti this year. This stake, valued at £124m, was claimed to be held by R&E, but Randgold Resources says these shares are not in the South African company's name.

Accountancy firm KPMG has been called in to conduct a thorough review of R&E's and JCI's accounts, after the resignation of the current auditors, the local firm of Charles Orbach & Co. It will be hoping to get to the bottom of all these mysteries.

Meanwhile, South Africa's National Prosecuting Authority has revealed that Mr Kebble was facing prosecution for fraud and contravention of the Stock Exchange Act at the time of his death. These charges have now been dropped. He was also said to owe over R100m in back taxes. A probe into this continues.

Despite this, Mr Kebble enjoyed a lavish lifestyle. He owned two mansions - one in Johannesburg, the other in Cape Town, - and commuted between them in two private jets, a Gulfstream II and a Bombardier Learjet 45. He also owned a collection of eight Ferrari sports cars.

Mr Kebble was once said to have blown R460,000 on a weekend in London, and famously went into a duty-free shop at Heathrow to buy 100 watches as gifts for friends.

Police still do not know whether Mr Kebble's killing was a professional hit or a car- jacking that went wrong.

It is just one of the many unanswered questions left by the death of a controversial businessman.