Civil action group, the Organization Undoing Tax Abuse (Outa) has shown evidence that the financial group which was hired by SAA and paid R256 million was not in a position to offer its services.
The group made the revelations at a press conference on Friday (8 July).
On Thursday, BDLive reported that state-owned airline, SAA, continued its dubious financial practices by awarding a R256 million award to a “boutique financier” without going through the appropriate tender processes.
According to the report, the SAA board waived tender procedures for the contract – against advice from its own treasury – and ended up paying three times what it had to for services.
The financier, BnP Capital, was initially appointed to advise SAA on the restructuring of its R15 billion debt.
The company then advised that it be hired, urgently, to raise the financing itself, securing a 1.5% success fee in the process.
According to Outa, after receiving a number of tip-offs about the illegality of the deal, it reached out to “various sources” through its whistle-blower platform and uncovered evidence that the deal was illegal can not move forward.
At the top of the list of dodgy elements in the deal, the group pointed out that BnP did not have a finance licence, which should have excluded it from consideration altogether.
“As part of criteria, they company should have had a Financial Services Board (FSB) license. This company had its license suspended,” it said.
Outa found out from the FSB that BnP Capital’s licence had been suspended for “possible serious transgressions”. Despite this fact, the documentation in the deal had a check mark next to the licence.
Adding further questions to the company, Outa pointed out that the BnP had a history of white directors – and shortly before the SAA deal, a black director was appointed. Outa also established BnP Capital is not trading from its registered address.
It also found that names had been crossed off of the approval documents, and other signatures had been added – and then put forward as having “full board approval”.
It called on more whistle blowers to come forward so that it could compile all the evidence to challenge the SAA – and other government institutions suspected of corrupt activities – in court.
“We will soon be exposing the road construction contracts,” said Outa lead, Wayne Duvenage. “We will do whatever we can to remove those involved in wrongdoing from office.”