SAP’s partner, TTCS, is 49 percent owned by EOH Holdings Ltd., a Johannesburg-based IT firm that’s already embroiled in allegations of corruption regarding South African government contracts. But as the value of the deal expanded from R180-million to R450-million, the demands of the business development partners grew too. The purported answer is set out in the “Road To Closure”, a standard SAP document designed to capture what role the business development partner will play in closing a deal. On 21 July 2016, the department held an “urgent” meeting with SAP in order to “negotiate and iron out any possible areas of concern” before the contract was signed. What global software giant SAP really knew about the Guptas. So zumindest lässt es sich der Schlagzeile des Business Insider South Africa vom 9. “The company’s business policy is to carry out all company activities in accordance with the letter and spirit of applicable legal requirements and therefore maintain the highest standards of business ethics. News. News & Views. JOHANNESBURG (AP) — South Africa's biggest corruption case since the end of apartheid has entangled not only the president and ruling party but also some major international companies, including U.S. firm McKinsey and KPMG. However, this would not be a first corruption to hit the German giants in recent times. For EOH, the timing is even more unfortunate given that it is still reeling from allegations surrounding a department of defence contract that prompted Microsoft to … How NBS Infosys would obtain approval from a procurement committee that cannot legally be interfered with, or why informal meetings with then minister Mokonyane would influence the contract, is not spelt out in the SAP documents. When the Public Protector questioned Mathe about some of the claims made in her submissions – for example, how had she determined which SAP modules to buy – Mathe said: “I am too old to prepare submissions, the director in my office prepares submissions, I gave her an instruction, this is what is going to happen, but ask SAP to help you.” (Mathe later contradicted this, telling the Public Protector that she did not allow SAP to write her submissions.). This looks more like a quid pro quo: If SAP promised an advance payment, the department would sign the contract. Might be nice to boycott them except my understanding is their software pretty much controls many databases in SA. Although there were still many unanswered questions, Mathe’s advice was: “[G]iven the current challenges faced by the department and its subsidiaries, there is no option but to invest and move at speed.”. A lot of this detail is already known from a, recently released Public Protector report. “Had I known that [the contract] only expired on 31 December 2016, I would not have approved the request for renewal as the existing contract still had a full year to run,” Diedricks told the SIU in an affidavit. The amaBhungane Centre for Investigative Journalism, an independent non-profit, produced this story. Mathe was the only person who had signed, but Pillay gave it a different spin: “The attached minute confirms that this transaction was approved internally by DWS and that they have the budget for this spend,” he told David, making no mention of the war raging inside the department. A comment added to SAP’s Deal Approval Form notes: “3rd Party Sales Commission strictly at 20% max.”. South Africa is one of the most kleptocratic governments in the world. And the new contract’s actual cost was R113-million, plus R25-million a year for maintenance (although SAP had offered a R26-million credit for the unused year). Be an amaB Supporter to help us do more. South Africa’s anti-corruption agency is investigating a 671 million rand ($60 million) government contract with German software firm SAP, which has admitted misconduct in separate deals involving friends of ousted president Jacob Zuma. On 25 October 2016, the department paid the R285-million. The first complaint on the whistle-blower’s list was a R949-million software contract that the department signed with software multinational SAP in 2016. Furthermore, [NBS] Infosys did not provide any services to Matsei and Matsei did not owe [NBS] Infosys any payment,” Van Niekerk told the SIU. They should be prevented from selling any new systems in SA from immediate effect until such time that these matters are cleared and persons brought to book. Be an, MAVERICK INSIDERS CAN COMMENT. On 26 June 2016, Lawrence Kandaswami, the newly appointed managing director of SAP South Africa, approached Pillay, his counterpart at SAP Africa, with an unusual request: the business development partners – now NBS Infosys and Matsei – had incurred “expenses” and were asking for an advance on their sales commission. Minutes from the “urgent” meeting between SAP and the department on 21 July 2016, even noted that the State Information Technology Agency has “a specialist team” to help the government negotiate software licencing because “exorbitant contracts with no value have been signed by Government Departments before”. In a statement released today, German software application firm, SAP, said that it has voluntarily disclosed the situation in its South Africa business to US authorities responsible for enforcing the US Foreign Corrupt Practices Act. Corruption news. Transnet is SA’s port, railroad, and pipeline company. “I’m writing to express my concerns about the corrupt activities that are taking place in our organisation, the National Department of Water and Sanitation under the leadership of the Hon Minister Nomvula Mokonyane,” the complaint read. SAP rips and replaces South African bosses amid corruption probe. about how SAP South Africa is moving on from the #GuptaLeaks scandal, but SAP has declined to answer our questions about the water department deals or for an interview to discuss other public sector deals. It is difficult not to be sceptical about Van Niekerk’s version: At a bare minimum, Matsei was helping SAP to disguise who it was paying and manufacturing bogus invoices to help the process along. ~ Albert Camus. We approached Van Niekerk for comment, but he told us that his affidavit was “confidential”, adding: “I am not at liberty to discuss it.”. Local Government. A lot of this detail is already known from a recently released Public Protector report. But amaBhungane’s research suggests that ERP Consultancy, whose sole director would become a shareholder of NBS Infosys only a few months later, had performed badly during SAP’s due diligence. While the rest of the country reeled from the fallout of Nenegate, SAP marvelled at two R100-million contracts it had just secured: the one at the water department and one at Transnet. Click here to see other benefits and to sign-up to our reader community supporting quality, independent journalism. View our comments policy here. I trust that the Securities and Exchange Commission and the Department of Justice who are jointly responsible for enforcing the Foreign Corrupt Practices Act and related laws in the U.S. are made aware of these activities. Acting chief financial officer Frans Moatshe later told the SIU: “[T]here was no approved budget… and funds had to be shifted from central operations budget to pay SAP.”. South Africa also has dedicated policies, standards and legislation specifically designed to enable the state to tackle corruption through both criminal and civil action. SAP South Africa concluded two contracts with Transnet and four with Eskom between December 2014 and June 2017, with GSS and CAD House acting as commissioned intermediaries. Woodmead SAP Young Professional Program - South Africa- 2021, 2148 SAP is one of a number of international companies that have found themselves immersed in corruption probes in South Africa. For the SIU, that would start with SAP paying back more than R400-million it earned on the 2015 and 2016 deals. Millions coughed up in commissions German ERP giant SAP has admitted irregularities and indications of misconduct in its South African business following a major corruption probe related to public sector deals worth almost $50m. The company is one among a plethora of multinationals that have been caught in the ever ensuing corruption and state capture scandals surrounding the infamous Gupta family. Corruption Watch is a Transparency International chapter working to fight corruption in South Africa For up to date information about COVID-19, please visit www.sacoronavirus.co.za x. Now the evidence gathered by the SIU shows that people throughout SAP’s global organisation knew about the R86-million commission but seemingly refused to say “no” to the biggest deal in SAP South Africa’s history. What officials seemed not to know was that a bet had been placed that the department could be talked into concluding the SAP deal before midnight on 31 December 2015. Als die Not am größten war, stand Hasso Plattner parat. Emails show that the process was coordinated by SAP. Except in this case, the water department was a long-standing SAP client and the contract was for all intents and purposes a renewal of an existing deal. We wanted to ask ERP Consultancy these questions, but the company is in the process of being deregistered and all attempts to conduct its sole director failed. Please note you must be a Maverick Insider to comment. All rights reserved, Please visit the official Government information portal for Coronavirus by clicking HERE. (SAP’s documents incorrectly identify the company as “ERP Consulting”, which does not exist. SAP had already been caught out during the #GuptaLeaks when it was revealed that it paid more than R100-million to Gupta-controlled companies – also acting as business development partners – to secure software deals at Transnet and Eskom. Despite Mathe’s best efforts, the bid adjudication committee was still sceptical and other officials were openly hostile to the deal. MANY PEOPLE BELIEVE that widespread political cortuption exists in South Africa. Puseletso Loselo, the chief director of legal services and one of those pushing back, claimed in an affidavit to the SIU that Mathe’s behaviour was “very strange… she acted as if she was an SAP representative. The question then becomes, why, with all these resources available to tackle corruption, do South … The department, which is in the unusual position of litigating, along with the SIU, against its own employee, told us this last part was not true – it had given Mathe copies of the papers. While 56% of all people on the African continent believe that their country could be doing more to curb corruption, 66% of South Africans believe that the government could be taking more steps to restrict corrupt activity. SAP had to do damage control after being embroiled with the Guptas. Mathe’s written motivation claimed that the department had the budget available. On 2 August 2016, the day before the local government elections, SAP made the first “advance payment” “€300K” to NBS Infosys, which translated into R5.5-million, excluding VAT. corruption is inherited from the past, the simultaneous democratization and restructuring of the South African state makes it very vulnerable to new forms of abuse in different locations. If so, are any investigation being dine there into SAP, given that the SAP managers mentioned knew it was wrong, likely bribes & still went ahead?? She said she had at the time appointed advocate Terry Motau, who made “recommendations for immediate action and further investigations”. German ERP giant SAP has admitted irregularities and indications of misconduct in its South African business following a major corruption probe related to public sector deals worth almost $50m. SAP has installed an acting managing director and acting chief financial officer at its scandal-hit South Africa subsidiary. In reality, however, corruption has been a constant feature of South African political life for much of the past 350 years. South Africa’s rating is 45. Personal Protective Equipment (PPE) tender corruption in South Africa. There was barely a month to go before the local government elections and Mokonyane, the minister that NBS Infosys had supposedly been meeting “informally”, was running the perpetually cash-starved ANC’s election campaign. Mathe wanted permission from then director-general Margaret Diedricks to renew the contract for another three years at a cost of R87-million. Mathe’s submission simply said these costs were “still to be determined”. But what kind of “groundwork” does a R14.9-million commission require? News. The SIU papers do not mention this allegation and Makasi maintains he had no involvement in the deal at all. The 2017 Transparency International Corruption Perceptions Index assigned South Africa an index of 43 out of 100, ranking South Africa 71 out of 180 countries. In den USA ist die Berichtssaison bereits im vollen Gange. I wanted to speak with Adair Fox-Martin, who leads SAP's entire EMEA business and who also sits on the SAP Board because for me, there are a good number of unanswered questions. Inexplicably, neither Diedricks nor the bid adjudication committee that had okayed the proposal a day earlier bothered to check if Mathe’s claims were true. “For reasons unknown to me, SAP could not at that time directly pay [NBS] Infosys for sales commission,” Van Niekerk told the SIU. Overview: In July 2017, SAP contracted Baker McKenzie to conduct an investigation into its public sector contracts in South Africa. The bribes are one thing but the scandalous overcharging by these consulting companies is the real crime. SAP faces further investigations as part of the corruption scandal that has tainted its South African operation, amid reports of a $2m kickback paid for a state contract with the firm. How Mathe pushed the contract through – successfully – makes for fascinating reading. Matsei had gladly accepted the role of business development partner when it was first asked to replace ERP Consultancy in April 2016. Agreed. It is sickening to see how this Department has been gutted by greedy and incompetent managers appointed under the guise of fast “transformation”. It is not clear whether anyone at Matsei was aware that the department had already signed the deal two days earlier; at SAP’s request, Van Niekerk had backdated the commission agreement to 26 July 2016. We are eager for these investigations to conclude, and SAP welcomes a just and fair outcome for the people of South Africa.”, For the SIU, that would start with SAP paying back more than R400-million it earned on the 2015 and 2016 deals.
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