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Sygnia fires KPMG

As its CEO takes a stand against private sector involvement in corruption.

Magda Wierzycka CEO of asset management company Sygnia is no stranger to the media and is outspoken on the subject of fees and the layers of fees that investors are charged by the industry.

However over the last six months the diminutive CEO has crossed the line from investment and finance into unchartered waters of corruption, misuse of public funds, the great Net1/Sassa rip off, state capture and the assault on the National Treasury and the Reserve Bank.

Last month she announced Sygnia’s new money market unit trust and said the firm will donate 100% of the management fees earned on the fund to non-political organisations fighting corruption, both in the public and the private sector. 

This week she went a step further announcing that Sygnia had fired its external auditor KPMG for its alleged role in state capture, according to this article in the Mail & Guardian.

“We are living through unprecedented times in South Africa where politics and economics have converged – one completely dependent on the other,” she said this week at the AHI SME Indaba in Cape Town.

“We are living through times when we are witnessing a battle between all that is good and decent in South Africa, and all that represents greed, corruption and economic destruction.”

What is happening, and what is affecting business among others, transcends the politics of one party. It is a battle for the soul and the future of South Africa. Do we survive as a democracy or descend into an autocratic kleptocracy? she asked.

“If the right things do not happen in the next five months, no number of short term strategies are going to lead to a flourishing economy and job creation. We are at a cross-road. And yet, I have been amazed at just how complacent most people are. Complacency, even just pessimism, is a comfort zone.

Following Clem Sunter’s high road, low road theme, she used the address to outline her views on the alternative scenarios facing SA. The low road she said, is already in play. To change track requires business, civil society organisations, trade unions, community organisations and opposition parties to unite, taking a strong stand against the moral corruption of the current government and the business sector that aids and abets that corruption (among other requirements).

But corruption is already becoming a way of doing businesses. “We have already seen international companies such as KPMG, McKinsey, SAP, Bell Pottinger, be it through commission or omission, looking the other way or not asking the right questions – implicated.”

KPMG was exposed in the Gupta emails for its role as the auditors of the Guptas’ Linkway Trading, the Mail & Guardian said. Linkway diverted government funding that was earmarked for the Gupta-linked Estina dairy project in the Free State, to cover the expense of a lavish family wedding.

KPMG also allowed Linkway to account for the wedding as a business expense, so no tax was paid on the Free State government funding, according to the Mail & Guardian.

Sygnia asked hard questions of KPMG about its business with the Gupta family to ascertain how it could have missed “a big money-laundering exercise”.

“The meeting didn’t dispel, in my mind, the perception that adequate oversight was not exercised,” Wierzycka told the Mail & Guardian.

She said Sygnia believed there remained many unanswered questions on KPMG’s relationship with the Gupta-related businesses, according to the article.

“We are at a cross-roads – but we are not helpless! We have a very narrow window of time to stand up and be counted. Those that do, will be remembered,” she said this week.

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Well done ! I don’t think this could have happened to a more deserving firm in this country!

Well done. I believe there’s no harm in drifting away from those you believe are the bad crowd.

High Five, Magda ! Now can everyone else please follow suit….

Yes, this is the only solution. Private companies should avoid the temptation to do business/contracts with the corrupt government just to make an extra buck. They must think where the millions must come from to pay for their services/products. The aftermath will come back and bite you.

Yes, this is the only solution. Private companies should avoid the temptation to do business/contracts with the corrupt government just to make an extra buck. They must think where the millions must come from to pay for their services/products. The aftermath will come back and bite you.

YES – and if only we could see this level of integrity in the low-down legal ‘profession’. Has any Lawyer walked away from the Zupta show?

Like boomgloom says – she is “da man”. Well done Magda, you’ve set a high bar for others.

“Sygnia asked hard questions of KPMG about its business with the Gupta family to ascertain how it could have missed “a big money-laundering exercise”.

“The meeting didn’t dispel, in my mind, the perception that adequate oversight was not exercised,” Wierzycka told the Mail & Guardian.”

I hope more firms will close their account with KPMG. They need to come clean and put proper measures in place. A junior auditor had raised the question of funding the wedding with corporate monies.

So the question is why are the NPA not investigating and putting in place a swift court case against these money launderers – maybe they have heard of FICA and Rica

= Captured.

NPA is captured. Hawks are also captured. Hence the Hawks refuse to investigate the emails and the NPA refuse to prosecute. Zuptas are safe…he he he he

Magda you are an exemplary South African and world citizen.

The world needs more people like you that stand up to what is wrong.

Thank you

Maybe this can be taken another step forward and the names of all the listed companies on the JSE that continue to use KPMG be published on a website so that we can all know who to shun and cut off from our business. Remember birds of a feather…

yes, there is an Afrikaans saying “meng jou met die semels en die varke eet jou “

Although I applaud the sentiment, Sydnia is hardly squeaky clean. Some suspect practices there.

Rather a churlish comment – pray spill the beans, but please be factual

Only when business stops dealing with firms that support or are involved with those who are or support corruption, will we begin to see some light. Good on you Magda!

I am sure there are millions who are saying, WELL DONE MAGDA!
Any person, institution or organisation who suspects or knowingly associates or do business or socialises with a dishonest person, people or any such other, can only be in self a dishonest person (if you steal, embezzle, take a bribe or partake in ANY form of corruption or dishonesty even if it is only R1, then you are in fact a criminal and if not yet branded will hopefully soon be branded. I heard a wonderful true saying; The dealer is as good as the stealer and should walk cuffed together.

Certainly admirable from a moral standpoint – But certainly she as the CEO should spend a bit more attention to her company – I mean the share price of her company is only down 41.3% Year to date!!!!!!

With Sygnia’s NPLs touching new lows she should now start focusing on her business!

In addition to killing some chickens to scare the monkeys, i’d like to see a junior school education programme on morals and ethics. You can change young people much easier than adults, and obviously it takes many years to filter through.

Sorry mate,

They do not even get the basics right never mind a programme on morals and ethics.

My kids are at a supposedly “very good” High School in Rand Park Ridge in Randburg (The only Model C high school in the area) and they are paying the price, the levels of education from some of the teachers is horrendous.

Ask the Mathematics teacher that cannot even present mathematics, my kid had to show him how to do a sum on the board and the rest of the class, instead of encouraging kids to aim higher he encourages kids to drop to easy subjects, the Science teacher is fresh out of varsity and seems to compete with the kids for attention, the English teacher is too tired and disinterested to teach.

Hence I am paying a fortune on School fees and my kids future is messed up now so say it mildly.

Not good news- I still think it is worth it to try. One idea I had, is to have morals/ethics ad campaigns on roadside billboards. Major routes like N1 etc are taken by most people every now and then, and some basic moral cartoons would help to shape society. A bit like school mottos, such as “always do your best”. I think it helps a lot.

SYGNIA is also looking after the smaller investor/s – top class people to deal with – GREAT THANKS to the CEO & the staff taking a personal interest in us as long term pensioners!!!!.. .. One day….. after the erosion of the daily noises of this government “gemors” going on!!!

”The question isn’t who is going to let me;
It is who is going to stop me” Ayn Rand

I think she had KPMG in mind!

This country needs strong, principled people to stand up otherwise we are going down. We cannot rely on the authorities and business, society and foundations need to step in where the authorities have failed.

The Lady has set the benchmark for the rest of the corporates sitting on the sidelines twiddling their thumbs. Corporates are part of the problem by not taking the moral high road in actively challenging corruption, both amongst their peers and in public institutions and sadly are often complicit in these misdemeanors.

I have an RA for each of my kids with Sygnia, actions like this displaying a high level of professionalism, ethics and corporate governance will make help make me a long term customer.

Hats off to you miss, you’ve got more balls then most of the corporate CEO’s.

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