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Come clean before it's too late, Save SA warns Gupta-linked firms

Sep 19 2017 19:21
Jan Cronje

People speaking at Save South Africa's 'real State of the Nation Address' say citizens are fed up with the state of the country under the current administration. (Paul Herman, News24)

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Cape Town - Clean government advocacy group Save South Africa has called on companies that have done business with the Guptas to "come clean, before it’s too late”.

“The last few days have shown that South Africans are increasingly angry at the activities of multinationals such as McKinsey, SAP and KPMG, and in particular their attempts to sidestep responsibility,” said Save SA in a media release on Tuesday. 

“South African outrage has already put an end to Bell Pottinger’s global dark arts, and dealt a body blow to KPMG’s reputation.”

The advocacy group has been at the forefront of mobilising civic society’s responses to instances of state capture, corruption and allegations of graft at Gupta family businesses.

Save SA has its sights set on three cases at the moment: KPMG SA, global consultancy firm McKinsey and the wider Gupta empire.

On Friday eight top executives of KPMG SA resigned, including its CEO, over work it had previously done for the Gupta family. The auditor also announced it was withdrawing the conclusions of its controversial "rogue unit" report, and offered to pay back its R23m fee for the report to the SA Revenue Service.  

Before it’s too late

But Save SA said KPMG must do more.   

“(It) must provide a full review of its involvement with SARS and the Guptas to the financial authorities, including the SA Institute of Chartered Accountants and the Independent Regulatory Board for Auditors,” it said

The advocacy group also said that consulting firm McKinsey must “drop the façade of innocence”.

“This approach did not work with Bell Pottinger or KPMG, and it will not work with McKinsey. It must tell the truth.”

This comes a day after the DA announced it would lodge fraud, racketeering and collusion complaints against McKinsey. 

Save SA called on McKinsey to “provide full disclosure about its dealings with Eskom and Gupta front company Trillian, and stop trying to pretend that there was no wrongdoing in their R1.6bn consulting contract with the two entities.”

On September 11, Corruption Watch said it would ask the US Justice Department to probe McKinsey’s dealings with state power utility Eskom.

Save SA said it supported the move, and called on businesses to take an “organised stand” against doing work with companies that were tainted by links to state capture or corruption.

“Their own reputations are at risk if they continue to deal with these companies,” it said.

So far two corporates have cut ties with KPMG SA this year for its links to the Guptas. Fintech company Sygnia terminated KPMG’s services in July, while on Tuesday Sasfin said it was dropping the auditors as its JSE sponsor (as well as its auditor) due to concerns over good governance stemming from the Gupta saga and its fumble on the SARS "rogue unit" report.

Bloomberg reports another company Hulisani, which invests in energy projects, also moved on Tuesday to replace KPMG, saying  it wanted shareholders to vote to appoint PricewaterhouseCoopers as its auditors. KPMG audited Hulisani’s full year results, which were published in May.

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