GHALEB CACHALIA

There are two ways to read the Mark Burke affair. One is that South Africa’s exchange control regime is an anachronistic relic of an era before crypto, instant cross-border payments and sophisticated fintech. The other is less comfortable: a fintech business operating squarely inside that regime may have designed a model that didn’t navigate the rules but circumvented them.

Both can be true at once. That is why the controversy over the DA federal finance chair and his company, Kastelo, deserves more than the usual partisan shouting. The Reserve Bank is investigating roughly R4bn in transactions it suspects breached exchange control rules, and the high court has upheld the Bank’s power to freeze Kastelo’s accounts pending that inquiry. That is not a finding that Burke or Kastelo illegally externalised anything; the underlying allegations are to be tested. But the substance of those allegations matters.

Exchange controls were built for an age of banks and slow-moving capital. Kastelo appears to have operated in a different world of crypto arbitrage and pooled foreign investment allowances. There’s a genuine case that South Africa’s controls need reform. But there is a difference between challenging a bad rule and engineering around it while still representing yourself as compliant.

Offshore facility

The question isn’t simply whether money left the country; it’s whose money, whose allowance, who controlled the transaction and who benefited. A company aggregating thousands of individuals’ allowances into an effective offshore facility is not the same as an individual using their own. Signed forms don’t automatically settle that; regulators look at substance, not just form.

If the Bank’s theory — that Kastelo used third parties’ “allowances” for a purpose they weren’t intended for — holds, that’s a different problem from clever compliance. Burke isn’t a bystander; he founded and chairs Kastelo and now holds the DA’s senior finance post. He has fiduciary duties: what did he know, what role did he play, when did he learn the Reserve Bank viewed the model as potentially unlawful?

The DA has always insisted that people entrusted with public responsibility should face scrutiny before conviction. It demanded ANC figures step aside over mere charges and pressed the same line on Malusi Gigaba in November 2025. That principle means something only if it applies across the aisle. The test isn’t whether the DA condemns or protects Burke; it’s whether it holds him to the standard it has demanded of others.

Kangaroo court

To be clear, Burke hasn’t been convicted, and freezing accounts pending investigation is a far lower bar than proving guilt. There’s no case for a political kangaroo court. But “no conviction yet” can’t become a solvent that dissolves all accountability. If it did, the DA’s own case against the ANC would wash away. The answer is scrutiny, not lynching or whitewash.

Burke could take this further than simply asserting his innocence. Given his oversight role, he could voluntarily recuse himself from matters touching the Bank, exchange controls and the like until the investigation concludes. This is not an admission of guilt but a demonstration that institutional confidence and legal innocence are different things. That would sit well alongside his own recent demands that the Public Investment Corporation needs a “better calibre of stewards”.

The affair should also spur a genuine rethink of exchange control — rules that distinguish innovation from evasion, rather than either criminalising fintech or excusing anything clever enough to dodge the law. But the sharpest test is simple: would the DA demand of an ANC politician, in an identical position, what it is now willing to demand of its own?

When the standard you’ve built your identity on comes knocking at your door, do you welcome them or refer them to the company, as the DA has?

• Cachalia, a business person and management consultant, is a former DA MP and shadow public enterprises minister, and chaired De Beers Namibia.