Outa welcomes SAP agreement to pay back the money

Outa has welcomed the resolution, findings and stiff penalties in the agreement concluded by the National Prosecuting Authority and US authorities with international software giant SAP and its South African subsidiary, Systems Applications Products, over SAP’s involvement in corruption.

“SAP’s conduct and direct involvement in corruption in South Africa was despicable and outrageous,” Wayne Duvenage, CEO of Outa, says.

The corruption that happened between 2013 and 2017 with some negotiated through the Guptas, resulted in SAP getting contracts with the City of Johannesburg, the City of Tshwane, the department of water and sanitation, Eskom, Transnet, Sars, Prasa and the Gauteng department of finance.

The US department of justice says SAP will pay more than $220 million in penalties for corruption in South Africa and Indonesia, with “up to $55.1 million of the criminal penalty” going to South Africa towards the South African settlement. That $220 million is worth about R4.1 billion and the $55.1 million is worth about R1.03 billion at current exchange rates.

The NPA says SAP will end up paying a total of R2.95 billion with R2.2 billion going to the South African entities in repayments, of which some have already been paid, plus R750 million in penalties. The penalty payment goes into the government’s Criminal Assets Recovery Account.

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SAP punitive payments far exceed penalties by SA courts

According to the NPA this agreement “subjects SAP to punitive reparation payments that far exceed any fine that the South African courts have ever imposed on a company as a criminal sentence”.

The agreement also requires SAP to cooperate with US and SA authorities in criminal investigations into the individuals involved in the corruption, including former SAP executives, South African government officials and intermediaries.

“While the alternative dispute resolution process does help to bring these matters to a close and achieve some level of accountability, Outa would like to see the individuals involved held to account, including those who acted for SAP, government officials and intermediaries,” Duvenage says.

“It is all too easy for these wealthy companies to pay fines and change their processes to ensure this conduct is never repeated, but this does not resolve the fact that the people who were directly involved are still walking the streets and enjoying the fruits of their ill-gotten gains.

“It is imperative that those involved are now rounded up, charged and imprisoned for their role in these nefarious activities.”

Duvenage says Outa supports these alternative dispute resolutions as a speedier and often more effective means of achieving justice, particularly when they include a requirement that the company is obliged to cooperate with criminal prosecution of the individuals involved.

“Outa would like to see the R750 million which goes in the Criminal Asset Recovery Account used to support the NPA in its efforts to prosecute state capture cases.”