By Caroline James
First published on Daily Maverick

We all know the story of Steinhoff and Marcus Jooste. At least, we think we do. 

What we do know has been uncovered by careful and thorough investigative journalism, but the majority of Jooste’s and the company’s secrets remain locked in a vault of confidentiality imposed by Steinhoff itself. 

What we do know is that in December 2017, Steinhoff’s auditors refused to sign off on the annual financial statements, Jooste resigned as CEO and the board of directors announced that there were “accounting irregularities which required further investigation”.

This sent the share price plummeting; it eventually lost 98% of its value, which cost shareholders R200-billion.

We know that this was South Africa’s biggest corporate fraud and that ordinary South Africans were the biggest losers in the company’s collapse: the Government Employees Pension Fund and other investment groups holding individuals’ pensions were major shareholders. 

We know that Jooste is yet to face a criminal trial and remains comfortably ensconced in his Hermanus mansion. 

But we do not know the whole story of exactly how that accounting fraud was perpetrated or who else played a role.

Steinhoff and its descendant companies appear to be doing all they can to keep that story hidden.

The most detailed investigation into what happened at Steinhoff was conducted by the accounting firm PwC, which was engaged by Steinhoff in December 2017. After 14 months, in March 2019, it delivered its hefty 7 000-page report to Steinhoff.

Steinhoff, however, released only an 11-page “overview”.

And so, we have to trust Steinhoff’s claims about what that PwC report contains and also that 11 pages can sufficiently convey what 7 000 pages were needed to say. We simply cannot do that. 

AmaBhungane and our colleagues at the Financial Mail filed separate requests in terms of the Promotion of Access to Information Act (Paia) for access to the PwC report. 

Without being able to see what PwC found we cannot hope to understand everything Jooste did within Steinhoff, including who helped him and why no one stopped him. This means that the public, the victims of his actions, will not know how or why their savings took the colossal knock they did. 

Steinhoff refused both the Paia requests, maintaining that the report had been commissioned by its lawyers — Werksmans — so that they could provide legal advice to Steinhoff, and was therefore legally privileged. 

Court battle

We joined forces with Financial Mail and took Steinhoff to court, asking the Western Cape High Court to order the company to release the report to us. 

Steinhoff fought hard. 

It repeated its belief that the report was legally privileged and that it had never waived that privilege. It challenged our position that the public interest in the report outweighed any reason for keeping it hidden and denied that it was possible to remove the legitimately confidential information and provide us with the rest. 

Steinhoff argued that our right to freedom of expression was not affected by its refusal to provide the report because we — and other media — had already reported on Steinhoff’s collapse. 

Steinhoff lost.

The court emphasised that “access to information is crucial to accurate reporting and thus to imparting accurate information to the public”.

It held that the report was not covered by legal privilege and ordered Steinhoff to provide us with access within 10 days.

Steinhoff immediately appealed against the decision, which suspended its obligation to provide access to the report. 

Since then, Steinhoff has introduced new and innovative ways to explain why it can’t give us access. 

Last February, Steinhoff introduced the new argument that because the company was registered in the Netherlands, Dutch and European Union data privacy law applied. 

This meant, Steinhoff said, that because the PwC report contained personal information it would be liable to penalties for breaching those Dutch and European laws if it provided us with the report. 

We had to engage the services of a European data law expert to tackle Steinhoff’s new arguments, demonstrating why we believed those laws did not hinder the disclosure of the report in South Africa.

And then, in November, Steinhoff added that, because its descendant company — a holding company set up to accommodate Steinhoff’s liquidation — is registered in the United Kingdom, UK data privacy law also applied and similarly prevented the disclosure of the report. 

Once again, we roped in the European data law expert. 

She restated that Steinhoff had misinterpreted the law and that the foreign laws in question should not serve as a hurdle to releasing the report at home. 

What is clear is that Steinhoff has no regard for the need for journalists to be given access to information. It has no conception of the exceptions given by data privacy laws for legitimate journalistic purposes. 

It seems leery of the vital role the media plays in investigating, reporting on and holding accountable those responsible for corporate crimes. 

All access-to-information and data privacy laws — in South Africa, the European Union, the Netherlands, and the UK — are explicit on the importance of providing access to nearly all information for the purposes of journalism.

As we have made clear in our court documents, our request to access the PwC report is grounded in the Constitution’s protection of the rights to freedom of expression — which includes the freedom to receive and impart information and to exercise media freedom. 

The Constitution explicitly states that everyone has the right to access information held by a private body when that access is required for the exercise of protection of any right. Our courts have confirmed that this right is triggered when journalists seek to access information.

Paia is the law that gives effect to this constitutional right. Although it does permit access requests to be refused on certain grounds, these refusals are not lawful when accessing information would be in the public interest and would reveal evidence of a “substantial contravention of, or failure to comply with, the law”. 

There cannot be a more clear-cut case of the public interest in accessing documents from a private company. 

With so many ordinary citizens and pensioners suffering because of Jooste’s conduct, and without criminal prosecutions being brought against him in South Africa, it is up to the media to investigate how Steinhoff was able to defraud investors so substantially and for so long.

The Supreme Court of Appeal is due to hear Steinhoff’s appeal in the first half of this year. It will be the next chapter of our continuing fight to tell the whole story of the Steinhoff implosion. 

Let’s hope it will be the last.

Caroline James is amaBhungane advocacy co-ordinator.