Former President Jacob Zuma must pay back the funds his legal team received from controversial diamond dealer Louis Liebenberg, an insolvency inquiry has found.

As previously reported, Liebenberg helped bankroll Zuma's private prosecution bids against journalist Karyn Maughan and President Cyril Ramaphosa.

The founder and co-director of Tariomix – which buys and sells polished diamonds and finances diamond transactions – last year ordered that the funds be paid from his attorney's trust account to Zuma's legal team. 

Fin24 reports that Liebenberg's attorney, Walter Niedinger, has said the R3.2m helped pay for the former President's private prosecution bids against Maughan and State Advocate Billy Downer SC, as well as his case against President Cyril Ramaphosa.

The courts have rejected both bids. 

Tariomix was placed under provisional liquidation in February by the North West High Court (Mahikeng) after clients complained they had not been paid out.

An insolvency inquiry overseen by Commissioner Eberhard Bertelsmann, a retired judge, has found that ‘money dished out liberally by Mr Liebenberg’ to people, including Zuma, must be recuperated ‘if needs be (by) way of litigation’.

Bertelsmann's interim report was submitted to the North West High Court (Mahikeng) last month.

While the report did not say what Zuma had to pay back, bank statements included in filings by Tariomix's provisional liquidators indicate that around R3.2m was paid to Zuma's legal team.

This included R750 000 to Zuma's counsel Dali Mpofu SC.

Full Fin24 report