Kidneygate: What the Netcare bosses really knew

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Kidneygate: What the Netcare bosses really knew

FATIMA HASSAN & SAM SOLE    | CAPE TOWN, SOUTH AFRICA    - Apr 29 2011 00:00

On May 27 four Durban surgeons are due to stand trial for their part in South Africa's kidney trafficking scandal.

But evidence in the Mail & Guardian's possession suggests that top Netcare executives are fortunate not to be standing beside them.

"Kidneygate" is the long-running saga of how -- between about 2000 and 2003 -- about 200 Israeli patients with kidney disease were brought to South Africa to receive organs from living donors who were presented as their relatives.

The donors were in fact poor Brazilians, Israelis and Romanians who were recruited by international organ traffickers and paid a relatively modest sum to give up a precious kidney -- a criminal offence under South African law.

To make matters worse, at least five of the donors are now known to have been legal minors at the time of the operations.

The four doctors -- John Robbs, Ariff Haffejee, Neil Christopher and Mahadev Naidoo -- are bitter at finding themselves at the short end of a chain of ethical dissimulation.

In theory, the buck stops with the doctor doing the cutting, but in reality, the transplant surgeons were little more than skilled mechanics dealing with bodies on an assembly line, maintained, paid for and legally underwritten by the big healthcare factory that is the Netcare Group.

Netcare: not know or not care?
Investigations by the M&G suggest that the biggest scandal of the case, which has dragged on since the first arrests in 2003, is the absence from the dock of any decision-maker from Netcare.

The company's Durban subsidiary, Netcare KwaZulu-Natal trading as St Augustine's Hospital, did plead guilty, paid a R4-million fine and agreed to a R3.8-million confiscation order in November 2010.

But the company has consistently maintained this was a technical plea.

In a response to questions company chair Jerry Vilakazi said: "The reason Netcare KZN pleaded guilty was because it became evident … that certain employees of Netcare KZN (who are no longer in its employ) must have been aware that certain of the cross-border operations that were carried out at St Augustine’s hospital were illegal."

Vilakazi, a prominent and influential businessman, said this created a criminal liability for the company "irrespective of whether or not the board or any director of Netcare KZN had such knowledge and, as mentioned, the directors of Netcare KZN had no knowledge of the illegal acts being perpetrated".

Netcare is particularly sensitive about the role of its current chief executive, Richard Friedland, who was initially charged alongside Netcare KZN and its parent, Netcare Limited.

Friedland, chief operating officer at the time, was a member of both boards.

According to Netcare, its directors have deposed two affidavits swearing they "were unaware that the operations were unlawful and that they were misled by false representations that were made to them and to other employees and representatives of Netcare".

The company claims: "The police and prosecuting authorities have confirmed their acceptance of Dr Richard Friedland’s innocence, evidenced by the unconditional withdrawal of charges against Dr Friedland and against Netcare Limited.

"No other director of Netcare has ever been accused or charged of unlawful conduct in relation to the transplant operations."

Plausible deniability
But investigations by the M&G suggest this claimed vacuum of knowledge among Netcare executives is, at best, highly improbable.

The company’s protestations that its top executives were misled are largely based on a set of legal formalities it adopted when dealing with donors and recipients.

On inspection they appear to have been designed for "plausible deniability" rather than as real protection against abuse.

How impervious these denials are to legal attack remains to be seen, if the case against the four doctors and two Netcare KZN transplant coordinators -- Melanie Azor and Lindy Dickson -- ever gets to trial.

Robbs, a former professor of surgery at the University of KwaZulu-Natal's medical school, has already publicly pointed out that the Israeli transplant programme was initiated at Netcare hospitals in Johannesburg and Cape Town, before being extended to Durban.

In a combative interview published earlier this year, he challenged: "Why do you think they paid a R7-million fine? Netcare made millions."

In the same interview Robbs said Netcare had been repeatedly questioned about the legality of the kidney transplants and the hospital group’s senior management, including former chairperson Michael "Motty" Sacks, had "constantly assured" doctors that the operations were "above board".

What did Friedland know?
Evidence seen by the M&G suggests that Friedland was an accused in his own right until Netcare KZN reached a plea agreement with the prosecution.

As late as September 2010 he was accused number three, and a draft summary of evidence stated: "Richard Friedland (accused 3) who was CEO of Netcare (accused 1) and a director of Netcare KwaZulu (accused 2), was, inter alia, aware, or made aware of the illegal transplant operations being performed at St Augustine's Hospital and nevertheless permitted these operations to continue."

It is not clear why the prosecution changed its mind in November 2010 and withdrew the charges against him. The company’s view, set out in its 2010 annual report, was that the withdrawal of charges vindicated the advice of Netcare’s legal counsel "that there was no basis for such charges to be laid".

In the plea and sentence agreement signed by Netcare itself, the fundamental implausibility of the company’s position is set out in stark terms.

The agreement states: "Employees of the accused company must have known that the kidney suppliers referred to in the charge sheet were not related [to the recipients]…

"The main circumstance supporting the above inference is the fact that the majority of the kidney suppliers came from Brazil, could speak only Portuguese and had Portuguese surnames, whereas the recipients came from Israel, had Israeli surnames and spoke, in the main, in Hebrew."

Certainly, ordinary staff saw through the charade.
According to one well-placed source "staff were gossiping" about the programme in the hospital canteen about the fact that donors and recipients were clearly not related to each other given how they looked, acted and spoke.

Warnings
Netcare also received a number of warnings, which it chose to ignore.

The most significant came from professor Del Kahn, then head of the South African Transplant Society.

According to several sources in Cape Town, where Kahn is head of surgery at the University of Cape Town's medical school, Kahn was approached by Ilan Perry -- who turned out to be a notorious Israeli organ broker (see sidebar below) -- on the basis that the Israeli health system could not cope with the demand and that he had patients with related donors.

After the first operation, in about 2000, surgeons became suspicious because the two supposed brothers did not interact. They told Perry they would require tissue matches for future transplants and never heard from him again.

Perry had, meanwhile, set up shop with Netcare and Kahn came to hear of numerous transplants being carried out on Israeli patients at the group's hospitals in Cape Town, Johannesburg and Durban.

Kahn was also prodded into action by Nancy Scheper-Hughes, the professor of anthropology at the University of California at Berkeley and founder of medical trafficking watchdog Organs Watch.
Scheper-Hughes, who has tracked the illegal organ trade for more than a decade, was the first to raise the alarm about Perry.

In August 2002 Kahn wrote to transplant units in Johannesburg and Durban. In his letter he stated that "it has been common knowledge for some time now that Israeli patients are coming to South Africa for living-related kidney transplants".

He said there were many "rumours" that the donors for these patients were not related, though he, personally, had not seen evidence to support this.

However, he pointed out that the organisers of these transplants were refused permission to set up surgeries in Eastern Europe and had been denied the right to carry out living-donor transplants in Israel.

Kahn said he had been assured that the correct procedures were being followed.

Nonetheless, because of the bad reputation this was giving South Africa, he ended his letter strongly advising those involved in organ transplants for Israeli patients to "immediately cease".

Slapped down
Kahn's concerns were slapped down by Netcare, in the form of a letter in December 2002 from Richard Treisman, at the time the company's internal legal counsel.

Treisman's rebuttal concluded that "these overborder transplants are in no way in contravention of the [Human Tissue] Act …

"Netcare Transplant Division complies with the requirements … by requiring each and every donor and recipient to sign a sworn affidavit to the effect that they are in fact family. This affidavit is stamped by the South African Israeli Embassy. This affidavit therefore negates the permission that must be obtained in the instance of an unrelated transplant…

"Prof Khan’s concerns are, in fact, based on hearsay and have no legal grounding whatsoever and -moreover no standing whether moral, ethical or legal to call for the cessation of these transplants."

Pressure
Several sources told the M&G that Kahn's letter was met with hostility and he was informally blackballed by some in the industry.
One hospital, however, took action.

In a confidential memorandum circulated earlier this year, the former clinical head of transplants at Netcare's Chris Barnard Memorial in Cape Town, Dr Elmin Steyn, set out her explanation of what happened.

"We performed about 40 transplants. The procedure we followed to assure compliance with the law was that all donors and recipients were interviewed by lawyers from Deneys Reitz Attorneys, a translator and a social worker to verify the affidavits that they had signed in Israel to declare that they were related and that they were not paid to donate. According to their passports … all of the donors and recipients were Israeli citizens.

"After a while, we became aware that Israeli transplants were also being done in Durban and Johannesburg. This we found odd, as we could not believe there were so many cases that could not be accommodated in their own country.

"We could not get a satisfactory explanation from our foreign colleagues, in spite of a letter that was received from the Israeli ministry of health stating that the transplants were legal and ethical. The situation was discussed with Prof D Kahn … We then decided to stop. Our colleagues in Durban and Johannesburg were formally advised by Prof Kahn that it was prudent to stop. An argument ensued and they refused to stop.

"We were encouraged by the then CEO of Netcare to resume the programme. We declined."

Netcare’s explanation
In response to questions from the M&G, Netcare confirmed that the company was warned about the possibility that "certain of the transplants were illegal".

When these warnings were communicated, it said it took the following steps:
"Belinda Rossi, the national head of transplants for Netcare, was asked to investigate these allegations. She did so and assured Netcare management, including Dr Richard Friedland, that there was nothing illegal about the operations … We point out that Belinda Rossi was subsequently given an indemnity from prosecution by the state in exchange for her evidence. Netcare has not seen her statement …

"Netcare requested nephrologists [kidney specialists] involved with the operations to respond to the allegations. They did so, in writing, and in no uncertain terms refuted the suggestion that the operations were illegal.

"Netcare took advice from its external attorneys … to introduce a process of checks and balances, in the form of sworn affidavits by donors and recipients … to ensure no money was passing hands, that the donors and donees were indeed related and that the donations of kidneys were being made for altruistic purposes.

"Netcare also engaged external counsel to attend interviews with donors and donees … to ensure the right questions were being asked, the affidavits were properly attested to and to report to Netcare if there was anything untoward … The report produced by external counsel did not reveal that there was anything improper.

"Netcare was informed by its legal consultants, both internal and external, that … Netcare was not required to conduct an interrogation of the patient.
"It was under these circumstances that Netcare satisfied itself and assured the doctors that the transplant operations were lawful.
"It is now evident that Netcare was intentionally misled by false statements that were made under oath."


No interrogatories
Quite how semiliterate inhabitants of Brazilian barrios could fool all these internal and external lawyers has not been explained. When the M&G attempted to probe this aspect and obtain copies of the lawyers' advice and reports, Netcare declined to respond.

The company noted: "The further questions raised by the Mail & Guardian … are loaded with innuendo and preconceived conclusions and also attempt to invade Netcare's attorney-and-client privilege and, as such, are both inappropriate and unfair.

"Netcare has been advised by its legal counsel not to submit itself to the Mail & Guardian’s interrogatories."

Little chance that kingpin and state witness will pitch

Ilan Perry is an Israeli business person with a background in medical insurance, who was involved in setting up a global transplant scheme involving the intercontinental trafficking of paid organ donors and patients.

Now he is listed as a state witness in the Durban kidney case, though there appears to be little likelihood of his ever leaving Israel to testify.

After South African police swooped on St Augustine's Hospital in 2003 and made the first arrests in the Netcare case, Perry was sought for extradition.

He was arrested on a South African Interpol warrant in Germany in 2006 but later released to return to Israel because of a bungled extradition process.

He was investigated for tax fraud but cleared because at the time brokering overseas transplants using paid donors was not illegal in Israel.

No one has done more to expose Perry's activities than Nancy Scheper-Hughes, professor of anthropology at the University of California, Berkeley.

Since 1996 Scheper-Hughes has been involved in research into the global traffic in human organs and is the author of a forthcoming account of her experiences: A World Cut in Two -- The Global Traffic in Organs.

She has been instrumental in exposing Perry's networks in South Africa and Brazil, as well as his links to associates such as Isaac Rosenbaum, an orthodox rabbi and alleged organ trafficker from Brooklyn, New York, and Dr Zaki Shapira and Dr Yusuf Sonmez, two of the world's most notorious transplant entrepreneurs.

According to a summary of substantial facts in the Durban case, Perry became involved with Netcare in early 2001.

At that time Belinda Rossi, the company's national transplant coordinator, travelled to Israel to attend meetings to assess the feasibility of performing kidney transplant operations on Israeli citizens in Netcare hospitals in South Africa.

A scheme was concluded whereby Israeli citizens in need of kidney transplants would be brought to South Africa for kidney transplants to be performed at St Augustine's.

The kidney suppliers for these operations were initially sourced among Israeli citizens, but later Romanian and Brazilian citizens were recruited, as their kidneys were obtainable at a far lower cost than those of the Israelis.

Perry was responsible for recruiting the kidney suppliers and recipients in the scheme. The prospective kidney recipients paid amounts ranging from about $100 000 to $120 000 to Perry or his company, UDG, as a total fee for an arranged kidney transplant in South Africa.

The Israeli suppliers were paid about $20 000 and, later, cheaper suppliers were sourced among Romanian and Brazilian citizens, who were paid, on average, $6 000 for their kidneys.

Once the blood of suitable selected suppliers was found to be generally compatible with that of prospective recipients, the suppliers were flown to South Africa.

On arrival further blood tests were done to ensure sufficient compatibility with the prospective recipients.

A large number of prospective suppliers and recipients were typically cross-matched before suitable blood-matches were found -- an extremely unusual procedure in circumstances where the suppliers and recipients were purportedly related.

The kidney suppliers and recipients were given documents to sign, falsely indicating that they were related.

Perry paid Netcare standard fees for the operations and related care, amounting to between R19-million and R21-million. Netcare, in turn, paid doctors and other service providers. -- Sam Sole and Fatima Hassan


The M&G Centre for Investigative Journalism, supported by M&G Media and the Open Society Foundation for South Africa, produced this story. All views are the centre’s. www.amabhungane.co.za.

Source: Mail & Guardian Online
Web Address: http://mg.co.za/article/2011-04-29-kidneygate-what-the-netcare-bosses-really-knew