ISMAIL MOMONIAT: When will Bain tell the whole truth about its role at Sars?
Public relations gloss cannot hide the fact that it plotted to undo the hard work put into building a world-renowned revenue collection agency
Bain & Company partner Athol Williams’s article “Jump into the fire to quell corporate pyre”, published on June 27, justifies his choice to rejoin the company when “many are running from Bain”, but fails to answer the real question facing him and the company’s leadership in Boston: when will Bain tell the whole truth about its role in attempting to capture and destroy the capacity of the SA Revenue Service (Sars)?
Bain’s contribution in facilitating state capture in SA is unforgivable. We must not be blinded by Bain’s PR gloss, which is now in full swing. Bain’s role in “restructuring” Sars in 2014 not only nearly destroyed Sars but also destroyed the livelihood of many officials it identified “to neutralise”.
The damage to Sars’s capacity to collect revenue not only significantly damaged our fiscal framework and economy, but further entrenched the devastating inequality that defines our nascent democracy. Bain deliberately plotted to reverse the hard work between 1994 and 2014 to build tax morality and Sars into a world-renowned revenue collection agency.
So serious were its actions that the Nugent commission recommends criminal prosecutions against Bain & Co. It found that Bain had engaged in a “premeditated offensive against Sars, strategised by the local office of Bain & Company Inc, located in Boston, for [former Sars head] Mr [Tom] Moyane to seize Sars … Mr Moyane’s interest was to take control of Sars. Bain’s interest was to make money.”
In plotting to do this, Bain’s head in SA, Vittorio Massone, had at least seven meetings with Moyane, as well as 10 or more meetings with former president Jacob Zuma from August 11 2012, some at Nkandla. Is this the way Bain wins contracts in the US? Or is this the way of doing business for developing countries only?
If Bain wants truly to make reparation, then it should give to South Africans what they want and not what Bain thinks they should haveJudge Bob Nugent
The “remedial plan” announced last week by Bain, including a new chair for its Africa oversight board and Williams’s elevation to partnership, is an insult to all South Africans. It confirms the company’s unrepentant stance in obfuscating its liability. Instead of full disclosure, Bain assumes that returning “all fees plus interest” and making “leadership and governance enhancements” are enough to reverse their damage.
This is in line with its evasive attitude to the Nugent commission, which concluded that “Bain has not engaged with the commission at all”, which is “an extraordinary approach to be adopted by a major international consultancy that claims its commitment to transparency”.
Judge Bob Nugent was clear: “If Bain wants truly to make reparation, then it should give to South Africans what they want and not what Bain thinks they should have, which it has steadfastly refrained from doing. Payment of money without prior disclosure of the truth is not reparation but is marketing instead.”
Williams’s article confounds expectation by not addressing the Nugent commission’s findings about his own role: “Nothing makes it more plain that Bain has withheld, and continues to withhold, information from the commission than the preliminary report prepared by Mr Williams, from which it is apparent that even he has yet to be told where the truth lies”. Can Williams tell us when Bain will provide us with all these final reports?
The Zondo and Nugent commissions have shown how too many multinational consultancies voraciously facilitated and capitalised on state capture for their own ends. Williams, a business ethics expert, will agree that multinational companies cannot maintain different standards of conduct between their parent countries and their foreign operations.
Its blatantly predatory behaviour in SA calls for all Bain’s public sector contracts to be scrutinised further, both in SA and in all other foreign countries, including for possibly transgressing US foreign corrupt practices laws. Massone (and those responsible from Boston) must be brought back to SA to face any possible charges.
Williams has not so much “run towards the fire when all logic dictates that I should be going in the opposite direction”, as jumping from the frying pan into fire. Perhaps the image of a funeral pyre Williams invokes is apt: something remains buried, waiting to rise from the ash. The leopard has not changed its spots, and he ain’t no firefighter!
• Momoniat is deputy director-general at the Treasury.