Analysis: Moyane is desperate about the KPMG rogue report, and he has a good reason

The South African Revenue Service (SARS) wanted an “independent” review into allegations published by the now disbanded Sunday Times investigative unit of a supposed “rogue unit” that spied on President Jacob Zuma, intercepted taxpayers’ communications and ran a brothel. Sars, headed by Moyane, mandated KPMG to investigate with the eye on criminal and disciplinary proceedings. It was supposed to be a proper investigation. But the opposite happened. Moyane already knew who he wanted to accuse, and what they should be found guilty of. So they kept a thumb on KPMG, whose investigators produced a documentary review based on documents given to investigators by SARS and its lawyers. This method mostly eliminated opposing views. For all practical purposes, it was unusable and skewed, not meeting the standards of a basic “investigation”.

Moyane’s management leaked a draft of this KPMG report, dated 3 September 2015. It made sensational claims, caused a media storm and, with the benefit of hindsight, was the first in a series of attacks on then minister of co-operative governance and traditional affairs Pravin Gordhan.

Realising the imminent reputational danger they found themselves in, KPMG hastily scribbled a disclaimer to be sent to SARS with the final report on 4 December 2015. The result: SARS couldn’t use the report for… well, anything. Despite taxpayers dishing out R23-million for it.

Curiously, Moyane’s management did not leak this final version. The jury is out as to why exactly. It is also this version of its report that KPMG withdrew on Friday, saying its findings and recommendations cannot be trusted. Scorpio has requested the final report under the Promotion of Access to Information Act, which SARS ignored for 30 days. The matter is now heading for the high court where a judge will consider the request.

Yet you will not hear this from SARS boss Tom Moyane, because what we know so far is already damning.

The tattle tales of misspelled words

In a  statement, riddled with misspelled words, Moyane on Monday threatened to unleash a legal fire against the “unethical, immoral and unprofessional” KPMG, including blacklisting, in order to ban the firm from working for government.

  170918_Statement - SARS Responds to KPMG Conduct

Moyane’s description of KPMG might be spot on, but for all the wrong reasons.

He hasn’t thrown his toys out of the cot because KPMG produced shoddy work, but rather because they came clean (sort of),  admitting  having produced shoddy work.

Why?

The accusations Moyane swung around like a club on Monday  provide the clue. Moyane’s full statement in this regard is worth quoting in full: “SARS sees KPMG’s conduct as nothing else but a dismal attempt to portray SARS, its leadership, and in particular SARS Commissioner as incompetent, corrupt, inefficient and involved in a witch hunt. This is the same narrative that has been perpetuated for years by some treacherous elements within society and the media.”

Now, KPMG has said many things in their  statement. And left many things unsaid, to their own detriment. But one thing KPMG didn’t do was to even point their pinky finger at SARS in an accusatory way. Also to their own detriment.

So why does Moyane make the (il)logical jump from KPMG admitting their SARS report is a dud to KPMG attempting to portray Moyane as “incompetent, corrupt, inefficient and involved in a witch hunt”?

This time, the clue is in KPMG’s  statement, delivered on Friday. It says that the former minister of finance “Pravin Gordhan knew, or ought to have known, of the establishment by SARS of an intelligence unit in contravention of the rule of law that was ‘rogue’ in nature. This was not the intended interpretation of the report. To be clear, the evidence in the documentation provided to KPMG South Africa does not support the interpretation that Mr Gordhan knew, or ought to have known, of the “rogue” nature of this unit.”

And then we move to the fact that ties it all together. It is not a fact you’ll read in any statement fired off recently. Rather, conspicuously absent from both Moyane’s and KPMG’s statements, is how KPMG copied and pasted big and material sections of their recommendations and findings from a memorandum drafted by SARS lawyers Mashiane Moodley & Monama.

(Another interesting fact, but not necessarily relevant to this opinion piece, is that it was the same firm, Mashiane Moodley & Monama, which ultimately told Moyane they did not agree with the ethics applied by the Hawks, the national prosecuting authority, and by implication SARS, in the investigation into Gordhan. That comment, sent to Moyane in an email, was the catalyst for the SARS “hostage drama”. Although, come to think of it, maybe the lawyers’ comments about the ethics around the investigation into Gordhan are, actually, highly relevant to this opinion piece.)

But okay, you would want to know why Scorpio claims that KPMG was so unethical and biased as to allow SARS’ lawyers to prescribe what KPMG should find and recommend.

The answer: KPMG pasted the same spelling errors and language mistakes from the SARS lawyers’  memorandum into their own, supposedly impartial, report. (Yes, you can use your choice swearword out loud right now.)

  SARS Memo to KMPG 

In a “Memorandum to KPMG”, dated 21 August 2015, Mashiane Moodley & Monama “recommend the following as Findings and Recommendations which may be incorporated at the very end of the [KPMG] report”.

These findings relating to Gordhan, Pillay, Magashula, Van Loggerenberg and others were copied and pasted into the “Executive findings and conclusions” of the KPMG report dated 3 September 2015. With Mashiane Moodley & Monama’s misspelled words.

  KPMG Report on Sars Rogue Unit 

When the veneer chips

Moyane neatly laid out his problem for us: If the KPMG report falls, his case against Gordhan fails. It will be seen for what it is – a predetermined fabrication, orchestrated by state capture forces, enabled by SARS under the direction of Moyane.

If KPMG’s disastrous withdrawal of their report accusing Gordhan of impropriety is accepted, there is nothing left to charge him with. Creating new charges to undermine his credibility anew will take time. And the one thing there is not much left of for anyone with their eye on December and the ANC’s elective conference is time.

The KPMG report was the veneer of credibility in the #SARSWars drama. Moyane made a big show on Monday of how the KPMG report validated the “findings” of the Sikhakhane report and the Kroon Commission’s findings. But Moyane knows none of this will stand in court and could only have hoped that no one attending his deceitful press conference would remember the correct set of facts. The Sikhakhane report has been described as having “erred in fact and law”. Besides, it did not adhere to the founding rule of an investigation – to give the accused a voice and to put all accusations to them.

Its findings were therefore not worth the paper they were written on. The Kroon Commission didn’t conduct any investigation, despite Moyane’s best efforts to make it seem so. Judge Frank Kroon and his panel simply rubber-stamped the Sikhakhane report, and admitted to have done so in a press conference when cross-examined by the media.

And now the KPMG report has fallen too.

Not much more can be said, except to misuse Moyane’s eloquent description:

KPMG’s conduct showed SARS, its leadership, and in particular its commissioner as “incompetent, corrupt, inefficient and involved in a witch hunt”. DM

Photo: SARS Commissioner Tom Moyane (Original photo: GCIS)