Outa and DA call for convictions as SIU releases damning report on SAA

The Special Investigating Unit (SIU) on Tuesday released a damning interim report on corruption that suggested a pre-business rescue SAA was fraught with financial irregularities to the tune of around R3.7 billion.

Curious financial dealings at SAA

The ongoing investigation commenced in 2020 after the SIU found sufficient evidence to justify a large-scale probe into alleged irregularities at the airline. The SIU’s mandate was far reaching and included several BBBEE procurement practices through to staff rebate travel, and everything in between.

Curious dealings included:

• R17 million invoices for aircraft parts that previously had a price tag of less than half of what SAA paid for it;
• SAA Technical sold ground power units at more than R5 million less than market price, and then hired them back at inflated prices.
• Former chair and now delinquent director Dudu Myeni swapped an Airbus A330 wide body order for smaller A320 aircraft; in turn Airbus refunded R824 million in pre-order payments and securities, but the money is missing.

The list goes on.

“It reads like a horror story of gross and excessive plundering of one of South Africa’s leading and proud state owned entities,” said Wayne Duvenage, chief executive of the Organisation Undoing Tax Abuse (Outa).

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‘Horrifying story of state capture’

Outa welcomed the report. “Most of this plundering took place under the watch of Dudu Myeni who, with her henchmen (former SAA CFO) Phumeza Nhantsi and (former SAA director) Yakhe Kwinana, set out to remove those managers like Cynthia Stimpel, Wolf Meyer, Thuli Mpshe, Sylvain Bosc, and others who got in the way of their plunder spree.

“In a very short space of time, so much money was looted, and the airline was trashed, even before the blow dealt by the Covid-19 pandemic. Many people lost their livelihoods and had to leave the country to find jobs elsewhere.”

The Democratic Alliance (DA) lamented that those responsible for the looting have not been convicted.

“It is a horrifying story of state capture during the Zuma administration but whose perpetrators have still not been held accountable,” said the DA’s Alf Lees.

“The incredible thing is that apparently none of those guilty of fraud and corruption have yet been convicted and whilst some of the corrupt cadres have ridden off into the sunset with their ill-gotten gains, there are still some employed at SAA. To add insult, it seems that none of those still employed by SAA have yet faced any disciplinary action and likely continuing with their malfeasance.”

Former employees and Board members implicated

The SIU identified current and former employees and Board members in its investigation who are liable for prosecution.

In its investigation the SIU identified an SAA employee who signed off on a request for quote for the supply of avionic components also happened to be the owner of the company awarded the tender. An SAA Board member also apparently took a R800 000 loan from a supplier to SAA Technical and subsequently awarded the same supplier contracts worth more than R6 million. A further R71 million was facilitated through an attorney’s bank account and paid back to SAA staff and Board members for the provision of what seems fictitious legal services.

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Much of the irregularities span a similar timeline to that of Myeni’s reign. Vuyani Jirana was chief executive of the airline and the last man standing before the pandemic forced SAA’s retreat into business rescue.

On the FlyAFrica Facebook page for aviation enthusiasts, outspoken former SAA pilot Duncan Gillespie wrote: “To date there have been zero convictions, very few charges laid and zero disciplinary action taken by South African Airways, as all employees or Board members involved have left the employment or service of SAA. No third-party attorneys involved in illicit transactions or dealings have been disbarred or sanctioned.”

Duvenage is calling for action to be taken after the release of the SIU report.

“The real tragedy is that Dudu Myeni and others heavily implicated in state capture, still roam the streets freely, living the high life and spend our stolen public funds without a care. We at Outa sincerely hope that with this thorough SIU report, that accountability will now take place and that Myeni and others will face long stiff jail sentences, in the not-too-distant future. But with our slow and poor track record on matters of this nature, we’re not holding our breath,” he said.

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