Since 2017, Corruption Watch has been calling for probes into and criminal charges regarding the professional conduct of auditing firms and service providers such as KPMG, McKinsey, Deloitte, and Trillian. These firms and others have been implicated in dodgy dealings with several state owned enterprises including Eskom and Transnet, as well as the South African Revenue Service.

In some cases these arrangements have been linked to the infamous Gupta family and their extensive involvement in the capture of the state.

Now, the Organized Crime and Corruption Reporting Project (OCCRP) has uncovered information that points to a Gupta-linked South African investment firm charging a major state-owned company US$2.8-million for property management services that it never provided.

At the centre of the new OCCRP investigation is Trillian – a known conduit for South Africa’s state capture scheme.

OCCRP journalists have dug through tens of thousands of leaked emails – known as the State Capture Papers – to discover that Trillian frequently sent unsolicited bids to provide dubious financial products for state-owned companies holding vast assets. Unsolicited bids are not allowed under South African law, which requires competitive bidding.

One of their targets was reportedly Transnet – the state-owned rail, port and pipeline company. Internal e-mails seen by the investigative journalists show Trillian proposed to place Transnet’s properties, including Johannesburg’s historic Carlton Hotel, in a private trust. This complicated deal seemed to have won Transnet over, even if though it has a property management division.

Journalists found that, in 2016, Transnet paid Trillian R46-million to render property management services in clear violation of the Public Finance Management Act. According to the investigation, Trillian never delivered the services. Transnet’s lingering debt problems are a clear evidence that the hefty fees extracted from South African taxpayers did not reap the benefits Trillian had promised on paper.

This begs an explanation from Transnet as well as South Africa’s Department of Public Enterprises. The ministry needs to clarify whether they had provided an approval for the doomed Trillian-Transnet property management deal and whether it will seek legal remedies on behalf of South African taxpayers.

Working to clean up public procurement

Earlier this month, Corruption Watch provided its comments on the draft public procurement bill that is currently out for public consultation.

The organisation’s submission centred on governance, accountability and transparency, for the very reason that public procurement is particularly prone to corruption – over the years various national departments, state owned enterprises, and provincial and local government have run up massive amounts in irregular expenditure linked to corruption procurement practices.

Among other things, Corruption Watch proposed to the National Treasury key measures to increase accountability in the public procurement process, stronger guarantees for the independence of the Public Procurement Regulator, and an efficient appeal process.