$50m in Gupta deals queried

Public sector ‘misconduct’ found

GERMAN software maker SAP says it found compliance breaches and “indications of misconduct” in $50 million (R595.3m) of public sector deals in South Africa involving the Guptas, friends of former president Jacob Zuma accused of corruption.

Outlining the findings of an external legal review of five software deals with state-run electricity firm Eskom and railfreight company Transnet, SAP said yesterday that three executives suspended last year had had resigned without severance pay.

Eskom said it would launch its own probe into the SAP contract.

SAP also admitted it had paid more than $9m to intermediary companies controlled by the Guptas. One of the Gupta brothers, Atul, was declared a fugitive from justice and fled South Africa.

However, the company said there was no evidence of direct payments to South African government officials.

As a result of the investigation, SAP said it had tightened up its compliance and anti-corruption procedures, including banning sales commissions on public sector contracts in countries with poor graft ratings, including South Africa.

“The investigation has confirmed that even strong compliance systems are vulnerable and therefore require eternal vigilance,” SAP board member Adaire Fox-Martin said.

“While we cannot turn back the clock, we can promise to do better.”

SAP shares were little changed at €86.91 (R1 227), up 0.2% at 1319 GMT.

A spokesperson for the Guptas was not available for comment. – Reuters