Offshore Fund Freeze Sparks Opposition Party Attack on DA Parliamentarian

R4 billion in alleged offshore fund movements sits at the centre of a court battle that has drawn South Africa’s two largest opposition parties into a direct confrontation with a senior Democratic Alliance MP.

Kastelo, a fintech company chaired by DA parliamentarian Mark Burke, lost its bid in the Johannesburg High Court to unfreeze bank accounts blocked by the South African Reserve Bank. Acting Judge S Johnson dismissed the application and ordered costs on the punitive attorney-and-client scale. The Reserve Bank has already frozen a portion of Kastelo’s funds held at Access Bank, with a broader investigation underway.

Additional reference context is available at https://www.moneyweb.co.za/news/south-africa/anc-eff-target-das-mark-burke-over-r4bn-allegations/.

The Reserve Bank’s affidavit, cited in court filings, goes well beyond routine regulatory concern. According to a Reserve Bank investigator, there is reason to believe Kastelo used clients’ allowances to move funds offshore for its own benefit. The alleged scheme is specific: Kastelo reportedly used clients’ single discretionary allowances and foreign investment allowances without their full knowledge, opened offshore bank accounts in their names, and misrepresented its activities in compliance declarations to the central bank. Transactions were allegedly conducted without clients’ knowledge or participation.

The financial stakes are considerable. R4 billion in alleged exchange control breaches places this squarely in the category of systemic conduct, not isolated error.

Burke served as Kastelo’s CEO until June 2024, stepping back to hand operational control to Nicholas Burke after his election to parliament in the 2024 national elections. He remains chair of the company. His parliamentary portfolio sharpens the contradiction: Burke sits on the DA’s federal executive as finance chair, responsible for internal financial controls and accountability, and serves on committees overseeing national appropriations and finance.

By contrast, Burke’s own defence draws a careful line between the company and himself personally. In a statement, he noted that the High Court judgment makes no finding of wrongdoing against him or Kastelo, and does not constitute a finding that exchange control contraventions have been proven. He characterised the court’s decision as confirming only that the Reserve Bank had grounds to issue a blocking order while its investigation continues. Burke added that since entering parliament, he has consistently recused himself from matters relating to the Reserve Bank, with a documented record of such recusals, and that all necessary declarations to parliament and the members interest register were completed timeously and accurately.

The EFF has framed the allegations in blunt terms. “This is not a paperwork error. It is the unauthorised use of other people’s money and identities, the concealment of offshore accounts, and deception of the central bank. That is financial crime, plain and simple,” the party said in a statement. The EFF also targeted the DA’s brand positioning directly: “The DA markets itself as the party of clean governance and financial discipline. Yet its own finance chairperson is implicated in a scheme that undermines the very principles they claim to uphold.”

The ANC has moved to convert the allegations into a structural parliamentary question. Caucus spokesperson Hlengiwe Hadebe called for Burke’s immediate removal from parliament’s finance-related committees. “Parliament cannot demand accountability from the Reserve Bank while tolerating a glaring conflict of interest in its own oversight structures,” she said, adding that Burke’s association with Kastelo “falls far short of what South Africans expect from their leaders.”

Whether the Reserve Bank’s investigation ultimately finds personal liability for Burke, or limits its findings to Kastelo’s corporate conduct, will determine how much of the political pressure converts into lasting consequence. The investigation remains open.