The Special Investigating Unit (SIU) has reported that the appointment of the 2015 Denel board deviated from the normal process and was influenced by the Gupta family.
The SIU on 3 March gave a presentation to the Standing Committee on Public Accounts (SCOPA) on its investigation into Denel, which covered numerous irregular contracts and dealings.
The SIU’s Zodwa Xesibe said the investigation emanated from a complaint received by the SIU in October 2018, and in July 2019 the SIU was authorised to investigate certain allegations against Denel.
The SIU subsequently primarily investigated serious malpractices or maladministration between January 2015 and November 2019.
Much of Denel’s woes started when the board was captured in 2015 and the Group Chief Executive Office and Group Chief Financial Officer were removed.
The SIU found that when former Department of Public Enterprises Minister Lynne Brown appointed the new board in 2015, “the appointment deviated from the normal process that is followed when appointing Board members for SOEs [State Owned Enterprises] including Denel. A list of what seemed to be proposed new Denel Board members was submitted by a certain Gupta associate to the Minister’s office. The proposed names differed from list already submitted through the normal governance process and it was the same list of names that was later presented to cabinet for approval. The Cabinet approved the proposed list of Board Members,” the SIU said.