Public Protector Busisiwe Mkhwebane has found Public Enterprises Minister Pravin Gordhan guilty of "improper conduct" over his approval of then-deputy South African Revenue Services (Sars) Commissioner Ivan Pillay's early retirement and payout.
Mkhwebane made the announcement at a media briefing on Friday afternoon.
In her remedial findings, Mkhwebane urged President Cyril Ramaphosa to take appropriate disciplinary action against Gordhan for violating the Constitution.
She also says that steps need to be taken to recover the money.
Mkhwebane's findings appear to be linked to her most recent investigation into the minister of public enterprises. As Fin24 previously reported, she subpoenaed Gordhan on April 8 this year to respond to 11 questions.
Most of the questions were related to the creation of the so-called Sars 'rogue unit'. She did not touch on this part of the investigation in her report. One of the 11 questions in the subpoena related to the appointment of Pillay as deputy commissioner of the tax agency.
At the time Gordhan's spokesperson, Adrian Lackay, told Fin24 that the subpoena amounted to an "abuse of office" by Mkhwebane.
The public protector, meanwhile, said she was investigating Gordhan to help "clear his name".
"We are investigating him to clear his name. We want him to assist us to do that," she said in late April.