SAP admits to paying Gupta-linked company for Eskom, Transnet contracts

SAP paid Gupta-owned CAD House more than R90 million between 2015 and 2016 in order to secure contracts with state-owned entities.

Picture: Twitter/@SAP.

JOHANNESBURG - The software giant SAP has admitted to paying millions to a Gupta-linked company that assisted it with contracts with Eskom and Transnet but has stressed that an investigation has not been completed.

SAP paid Gupta-owned CAD House more than R90 million between 2015 and 2016 in order to secure contracts with state-owned entities.

It is now reporting these accounts to US authorities for further investigation and taking action against three employees.

SAP's Adaire Fox-Martin says Baker McKenzie has been contracted to investigate allegations of wrongdoing and the past three months have been humbling.

“We obviously look to regain the trust that we’ve enjoyed in South Africa over the past 20 or so years of our operations here. It’s a very important market for us."

Fox-Martin insists that there's been no evidence of payments made to South African government officials or Eskom and Transnet employees.

She said: “We continue to engage with Baker McKenzie as they complete the investigation. SAP has been deeply humbled by these allegations of wrongdoing. We have apologised wholeheartedly and unreservedly to our customers, partners and to the public here in South Africa.”

However, the four contracts it had in place with these state-owned entities resulted in commission payments of up to R100 million to a company it "understands to be Gupta-related".

SAP has reported these accounts to the US authorities and put stricter measures in place but it's not working with South African authorities at this stage.

The software giant says its eliminated sales commissions on all public-sector deals in high-risk countries, including South Africa, and has made significant changes to its business.

CORRUPTION WATCH

Meanwhile, Corruption Watch says software giant SAP may be facing penalties down the line after reporting itself to the US authorities.

Corruption Watch's David Lewis says SAP may have been obliged to report the matter.

“Obviously, they’ve concluded that they’re on the wrong end, potentially, of a very serious criminal investigation and so have decided to make their admissions. We’re talking about potentially very large penalties at the end of it.”