SAP suspends SA management as it launches investigation into Gupta links
German software group SAP has announced that it has put its South African management team on “administrative leave”, as it launches an investigation into apparent ties to the Gupta family in South Africa.
The group said that it has initiated an independent investigation, spearheaded by a multinational law firm, to vigorously review contracts awarded by SAP South Africa.
“Media reports have raised questions surrounding contracts and third-party business practices in the country. SAP rigorously investigates any allegations of wrongdoing in any of the more than 180 countries where it operates,” it said in a statement.
It has also launched an internal review and will make the results of the investigation public once it is concluded, it said.
It was revealed earlier this week through a series of leaked emails that SAP had paid a Gupta-linked company as much as R100 million in apparent kickbacks, for helping the software group secure contracts with Transnet.
The agreement SAP had with the company – CAD House – was to pay a 10% commission for any contracts secured over R100 million. The R100 million payment to CAD House implies the firm secured R1 billion in government contracts for SAP.
While commission agreements are not uncommon in SAP’s field, questions were raised around why CAD House was selected. The group sells 3D printers and has little marketing or sales capability – and it was going through business rescue at the time.
Investigations by amaBhungane found that CAD House was run as a subsidiary of the Gupta-owned Sahara Computers; and it became apparent that it was chosen because of the family’s close links to government officials.
It was further revealed through the leaked emails that confidential SAP contracts were forwarded to the Guptas.
SAP South Africa reacted to the reports by denying any wrongdoing, and threatening to take action against the media houses reporting on the matter.
Read: Confidential SAP contracts ended up in Gupta hands: report
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