The Department of Employment and Labour (DEL) recently commissioned an investigation that has thrown into the spotlight the questionable ethics of Neville Gawula, a “controversial” attorney.
Gawula’s legal firm, N Gawula Attorneys Inc., was appointed to review the selection process behind the deal between the Unemployment Insurance Fund (UIF) and investment company Thuja Capital, and to conduct the due diligence of the company.
Last month, Minister of Employment and Labour, Thulas Nxesi, indicated that he had received the forensic report on the findings and recommendations of investigations into a R5 billion agreement entered into between the department and Thuja Investments to ramp up job creation.
At the end of August, the minister was presented with a 255-page forensic report on the process followed in the appointment.
In a statement on the outcomes of the investigation, DEL spokesperson Sabelo Mali said the investigation found that there was gross negligence on the part of DEL and UIF officials.
“The report found and established that the senior officials of DEL and UIF failed to ensure that the UIF maintained an effective, efficient, and transparent system of financial and risk management, including internal controls and an appropriate procurement and provisioning system that is fair, equitable, transparent, competitive and cost effective,” said the department through a statement by Sabelo Mali.
Thuja was required to assist the UIF in creating jobs over a period of time.
Instead, Gawula appears to have sidestepped the assignment, expanding and creating scope for more work for himself.
In 2011, The Witness reported that Gawula – then a senior official in the Department of Justice – abruptly exited his role in the middle of an investigation that raised questions about the legitimacy of his academic credentials.
It is alleged that he claimed he obtained his B.Juris in 1995 and his LLB in 1997 from Vista University in Port Elizabeth.
Gawula was suspended in July that year after his law qualifications allegedly could not be verified. The brief CV on his company profile states that he has an LLB and LLM from Wits University.
Despite a clear mandate from Nxesi to investigate the capacity of Thuja to execute the said project, Gawula’s firm failed to engage with Thuja Capital – arguably the most crucial stakeholder – rendering the investigation both incomplete and fundamentally flawed.
Mali also confirmed this.
In a complaint sent to the public protector, an anonymous whistle-blower claimed that “the recommendations and the terms of reference do not talk to each other at all, and it is clear that the service provider was creating more work for themselves from the recommendations done”.
“The report by Gawula hyper-focused on the department's internal operations, while ignoring the terms of reference. The recommendations seem more designed to pad their bottom line than to address the requirements of DEL. A further glaring deviation from the terms of reference in favour of Gawula was a questionable extension of scope revealed in the Masuku letter,” the whistle-blower said.
The Star has also seen a letter dated September 7, 2023, in which Advocate Thabani Masuku attempts to bypass procurement regulations by directly asking for the appointment of N Gawula Inc to represent the department in the litigation against Thuja, flouting the Public Finance Management Act (PFMA).
Masuku SC’s request to retain Gawula’s service without due diligence stokes the suspicion.
“In preparation of the application to review and set aside the agreement, it would be prudent and cost effective to appoint N Gawula Inc as attorneys ... as they have the information necessary for us to prepare a thorough application which accurately represents the department’s interests,” Masuku wrote to the minister.
The letter to the public protector further states: “We have it in good authority that the service provider in question never met with the critical stakeholders to conclude and meet the requirements of the terms of reference. So, the report would be technically incomplete.”
The whistle-blower said: “The pattern is troublingly clear: Gawula’s firm seems intent on inflating their billable hours through more new work in the department, at the expense of a comprehensive, unbiased investigation meeting the scope.”
Mali said the minister has since recommended that the said officials face a disciplinary process.
Lee Binneman, who represents N Gawula Attorneys, told The Star that they are still consulting with their client following the forensic report ordered by the minister, which set the DEL and Thuja Project agreement aside following accusations of improper conduct on the part of DEL and UIF oficials.
“Thank you for your correspondence. I will consult with my client tomorrow and revert,” Binneman said.
This is a Saturday Star and The Star investigation. This is a developing story.