FSCA Launches Investigation into Public Investment Corporation Amid Leadership Turmoil
The Financial Sector Conduct Authority (FSCA) announced on Tuesday that it will open a formal investigation into the Public Investment Corporation (PIC), South Africa’s largest state‑owned asset manager, citing concerns over governance, leadership stability and transparency. The move follows a series of high‑profile suspensions at the PIC, including the removal of CEO Patrick Dlamini and acting chief investment officer August van Heerden.
Background on the PIC and Recent Leadership Changes
The PIC manages more than R3 trillion in assets, making it the single biggest investor on the Johannesburg Stock Exchange (JSE). Its mandate is to invest public sector savings on behalf of government entities, pension funds and other state‑linked investors.
Leadership upheaval began in March 2026 when former CEO Kabelo Rikhotso was placed on precautionary suspension after a whistle‑blower alleged misconduct. Rikhotso’s departure was followed by the appointment of Patrick Dlamini as CEO in June 2025. Dlamini was tasked with turning around the troubled Isibaya Fund, the PIC’s unlisted investment book that has suffered years of poor performance and controversial deals.
In early July 2026 the PIC board suspended Dlamini, citing allegations of unlawful conduct presented in a whistle‑blower report received the previous month. Shortly thereafter, acting chief investment officer August van Heerden – who had stepped in after Rikhotso’s ouster – was also removed from his role.
FSCA’s Concerns and Legal Basis
In a brief statement, the FSCA said it was concerned about the “potential impact of these developments on the integrity and trust of one of South Africa’s most important financial institutions.” The regulator highlighted that, as the custodian of significant public sector savings, the PIC bears an increased responsibility to uphold the highest standards of governance, integrity, accountability and conduct.
The investigation will be conducted under section 135 of the Financial Sector Regulation Act, which empowers the FSCA to inquire into matters that may affect the proper functioning of financial institutions or the stability of the financial system.
“The events of recent months raise serious questions whether these standards are being consistently met. Therefore, the FSCA has decided to conduct an investigation into these developments at the PIC in terms of section 135 of the Financial Sector Regulation Act,” the authority said.
Responses from the PIC and Regulators
The PIC responded promptly, stating that it had already supplied the FSCA with the information and documents requested regarding the whistle‑blower report and the associated governance process. The corporation emphasized that both the current and previous boards have prioritised strengthening governance and implementing the recommendations of the Mpati Commission, which was set up in 2018 to probe allegations of impropriety at the PIC.
“Although challenges remain, the PIC has made significant progress in strengthening the company’s governance framework and supervisory processes. The Board remains fully committed to working with all regulators and ensuring that governance matters are addressed through independent, credible and transparent processes,”
– PIC statement, July 2026
Deputy Finance Minister and PIC chairman David Masondo also asked the Special Investigations Unit to comment on a long‑standing dispute involving an enabling transaction financed by the PIC that resulted in a settlement exceeding R400 million. The PIC said it continues to cooperate with all investigative bodies.
Implications for South Africa’s Financial Markets
Given the PIC’s outsized influence on the JSE, any perceived weakness in its governance could affect investor confidence, particularly among foreign portfolio investors who monitor the state‑owned asset manager as a barometer of South Africa’s institutional credibility.
Analysts note that the FSCA’s intervention signals a willingness to enforce accountability at even the largest state‑run entities. A transparent investigation could ultimately reinforce trust if it identifies shortcomings and leads to concrete remedial actions.
- March 2026: Kabelo Rikhotso placed on precautionary suspension after whistle‑blower complaint.
- June 2025: Patrick Dlamini appointed CEO, tasked with rehabilitating the Isibaya Fund.
- July 2026: Dlamini suspended; acting CIO August van Heerden also removed.
- July 15 2026: FSCA announces investigation under section 135 of the Financial Sector Regulation Act.
The investigation is expected to examine the board’s oversight mechanisms, the handling of whistle‑blower allegations, and the PIC’s compliance with governance reforms introduced after the Mpati Commission’s findings. Outcome timelines have not been disclosed, but the FSCA indicated it will provide updates as the probe progresses.
