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Daybreak Lawyers Massive R124m in Legal Payments

Statement by Andrew Bateman MP – DA Deputy Spokesperson on Appropriations:

The DA has lodged a formal complaint with the Legal Practice Council (LPC) against attorney Pulane Jimmy Malahlela and Malahlela and Company Attorneys over extraordinary legal spending at Daybreak Foods.

Daybreak is owned through the PIC by the GEPF, UIF and Compensation Fund. This means the money at stake ultimately belongs to government employees and pensioners, and to workers.

The complaint asks the LPC to investigate apparently excessive legal bills, duplicate payments, millions of rands in payments that could not be matched to invoices, and allegations that lawyers were used against employees who raised concerns at Daybreak.

It also raises an extraordinary question: why was a poultry company paying lawyers for work relating to State Capture?

Fundudzi Forensic Services records numerous amounts billed by Malahlela Attorneys for “Daybreak – State capture analysis and legal advisory”.

Who commissioned this work, and whose interests was it serving?

Fundudzi records that Daybreak paid Malahlela Attorneys/Black-White R101.5 million between April 2021 and October 2022. It identified apparently excessive hours and duplicate transactions.

Daybreak’s Business Rescue Plan later records that Nexus found approximately R123.9 million had been paid to Malahlela Attorneys over two years. Of this, R39.9 million could not be matched to invoices and another R8.8 million was suspected to be duplicate payments. The Plan states that Malahlela Attorneys were implicated in “financial improprieties”.

The complaint also raises allegations that approximately R57 million was spent on legal action involving employees who had raised concerns at Daybreak.

The DA has asked the LPC to investigate possible breaches involving honesty and integrity, unnecessary legal costs and abuse of legal process, as well as a possible conflict of interest.

The LPC complaint forms part of the DA’s wider effort to uncover what happened at Daybreak, who benefited from its looting, and who should be held accountable for its collapse.

Almost 1,900 workers lost their jobs, while approximately R2 billion invested on behalf of government employees, pensioners and workers has been put at risk. They deserve answers.

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