Background and context
In the matter of Special Investigating Unit (SIU) v Sanele Dlamini and Others, the Special Tribunal was asked to prohibit Mr Dlamini, a former senior manager of the National Lotteries Commission (NLC), from accessing or prejudicing his pension funds held by Liberty Life Insurance.
The SIU brought the application following its investigation into irregularities in NLC grant funding. Proclamation 32 of 2020 authorised the investigation, which revealed that R9 million in grant funding awarded to the Motheo Foundation was allegedly misappropriated.
A R70 000 grant application was initially rejected, but on the same day, a R9 million proactive funding proposal was approved for a sports complex, to be paid in two tranches. The SIU’s investigation found that the first tranche of R3.5 million was not used for the intended project but instead shared among individuals as undue gratification. The second tranche of R3 million was paid based on a fabricated progress report signed by Mr Dlamini and Ms Maodi, an executive assistant to the NLC CEO with no authority to approve such reports. Notably, the SIU highlighted that Ms Maodi had a close personal relationship with Mr Sedibi of the Motheo Foundation, further raising concerns about collusion. Mr Dlamini was dismissed by the NLC on 4 October 2024 following a disciplinary process.
The SIU then sought to preserve Mr Dlamini’s pension benefits under section 37D of the Pension Funds Act as security for possible recovery.
Judgment of the Special Tribunal
Judge Margaret Victor, President of the Tribunal, delivered a comprehensive judgment, outlining the requirements for granting an interim interdicts and the Tribunal’s authority.
Key findings:
- The Tribunal affirmed that section 37D(1)(b)(ii) of the Pension Funds Act allows employers to secure claims arising from dishonest conduct by employees, provided a judgment is obtained. The provision entitles an employer to deduct any amount due by a member as compensation for damage caused by theft, dishonesty, fraud or misconduct, if a judgment has been obtained against the member in any court, including the Magistrates’ Court. The NLC’s disciplinary finding of gross misconduct with elements of dishonesty satisfied this requirement.
- The Tribunal confirmed that the SIU had established a prima facie right, given that Mr Dlamini co-signed a fabricated progress report that led to the payment of R3 million. The Tribunal held that there was a reasonable apprehension of irreparable harm should the pension benefits be released and found that the SIU’s main application had reasonable prospects of success.
- The Tribunal acknowledged that it is arguable that it may not ultimately have the authority to order a deduction from a pension fund, as it is not a court of law. However, it noted that the SIU Act confers jurisdiction on the Tribunal to adjudicate civil proceedings, and that these questions must be determined in the main application.
- Accordingly, questions regarding the proper interpretation of section 37D of the Pension Funds Act do not present a legal obstacle to granting interim relief.
Order
- Mr Dlamini was interdicted from accessing or diminishing the value of his pension funds held by Corporate Selection Umbrella Retirement Fund. Liberty Life, the NLC, and the Motheo Foundation were similarly interdicted from paying out or otherwise dealing with the pension benefits.
Timeline of events
| Date | Event |
|---|---|
| 6 November 2020 | Proclamation 32 of 2020 gazetted | 14 April 2021 | Motheo Foundation reject funding of R70 000.00, and proactive funding of R9 million to Motheo Foundation approved |
| Mid-to-late 2021 | First R 3 596 637.61 payment made by NLC to Motheo Foundation |
| February 2022 | Second R3 million payment made following fabricated progress reports |
| 11 December 2023 | NLC disciplinary inquiry into Mr Dlamini’s conduct initiated |
| 27 September 2024 | Mr Dlamini found guilty by Chair of NLC disciplinary inquiry |
| 4 October 2024 | Mr Dlamini dismissed from employment |
| 14 October 2024 | SIU instituted main civil proceedings |
| 12 March 2025 | Mr Dlamini applies to access pension funds |
| 28 February 2025 | SIU files urgent interdict application |
| 30 April 2025 | Hearing held |
| 10 June 2025 | Judgment handed down |
Conclusion
This judgment affirms the Tribunal’s role in preserving public funds while civil recovery proceedings are ongoing. It clarifies that while the Tribunal’s power to order deductions from pension funds remains a matter for the main application, interim preservation of such funds is both lawful and necessary to safeguard potential recoveries. The ruling sends a strong message: public officials implicated in dishonesty cannot evade accountability by accessing their retirement funds before due legal process concludes.
This case highlights the important role the Special Tribunal plays in ensuring public funds are protected while investigations and civil claims are pursued. The Progress Report will continue to track this and other key cases, reporting on the outcomes, legal developments, and challenges, to keep the public informed and institutions accountable.