A while ago the Competition Commission exposed collusive dealing by major banks in the foreign exchange market. Lately the auditor of these banks, KPMG, allegedly manipulated audit reports in favour of Gupta-owned companies to contravene the Auditing Profession Act in addition to the Companies Act.
I smell a rat.
KPMG may have ignored the risks of material misstatements by intentional omission.
Former US president Grover Cleveland said: "A man is known by the company he keeps, and also by the company from which he is kept out." The former hits the nail on the head.
The question is why KPMG executives were willing enablers of such misrepresentation, knowing that it would hurt the firm’s reputation. Clearly, their ties with the Guptas were a symbiotic relationship for fraudulent purposes or with intent to defraud. This being alleged, criminal charges must be laid; no escaping resignation would ward off the premeditated wrongdoing.
There is prima facie evidence of corruption that must be referred to the authorities for investigation. It may bring to light other cover-ups of illegal activities involving money laundering and tax evasion.
These controversial ethical issues seem to be orchestrated in cahoots with other actors central to the shenanigans that are adversely affecting the South African Revenue Service.
The state of affairs warrants appropriate action by the Independent Regulatory Board of Auditors relating to false or misleading information in the financial statements and further review all audit reports of its clients, including banks under investigation for collusion.
It is strange that notable civil society leaders are conspicuously tongue-tied.
Who knows, maybe they’re conflicted.
The #FeesMustFall movement should take centre stage and demand that KPMG transfer all monies paid by the Gupta companies into the National Student Financial Aid Scheme or face mass action.