US justice department launches investigation into SAP-Gupta dealings

The Gupta family has found itself at the centre of law enforcement investigations in both the United Kingdom and the US. (Delwyn Verasamy, M&G)

The Gupta family has found itself at the centre of law enforcement investigations in both the United Kingdom and the US. (Delwyn Verasamy, M&G)

The United States’ department of justice and its securities and exchange commission (SEC) has begun investigating German multinational software company SAP for its dealing with the Gupta family.

It emerged on Thursday that SAP had reported itself to the US authorities for alleged misconduct which saw the company making large payments to the Gupta family.

SAP is now the first transnational company to report itself to US authorities for potentially violating US laws, including the US Foreign Corrupt Practices Act.

On Thursday Adaire Fox-Martin, a member of SAP’s board, said: “We cannot emphasise enough how seriously the SAP executive board takes these allegations, or how committed we are to managing this process in a transparent, ethical and responsible way.”

The Gupta family has found itself at the centre of law enforcement investigations in both the United Kingdom and the US.

The Serious Fraud Office in the UK has launched a probe into British banks who are knowingly or unknowingly involved in the family’s alleged illicit business flows that has seen millions leave South Africa.

The FBI and the US justice department has also begun investigating the Gupta family and their relatives in the US. The FBI is reported to be also looking into bank accounts and companies in the US that have ties to the family. 

SAP decided to start an internal investigation into its business with the Guptas after it was reported that it had closed a “sales commission agreement” with a Gupta company which saw the family get an alleged R99.9-million in kickbacks for apparently opening deals for SAP to work with state-owned entities like Transnet and Eskom. 

The internal investigation found that there was misconduct in SAP’s dealings with the Guptas. The company said in a statement, however, that if found no payments were made to Transnet and Eskom. 

“To this end, SAP has instituted formal disciplinary proceedings, in accordance with South African labour law, against three employees who were placed on administrative leave at the beginning of the investigation,” the company said in a statement. 

So far, auditing giant KPMG and global consultancy firm McKinsey have been implicated in the Gupta scandal. 

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