You are currently viewing our desktop site, do you want to download our app instead?
Moneyweb Android App Moneyweb iOS App Moneyweb Mobile Web App

NEW SENS search and JSE share prices

More about the app

McKinsey to repay R650m, testify in SA graft probe

For contracts it had with South African Airways and state logistics company Transnet, as it seeks to clear its name in the country.
Image: Guillem Sartorio/Bloomberg

McKinsey & Co. will repay R650 million ($44 million) for contracts it had with South African Airways and state logistics company Transnet SOC Ltd., as it seeks to clear its name in the country.

The consultancy firm’s chief risk officer, Jean-Christophe Mieszala, will on Thursday testify at a state graft probe. McKinsey said the contracts were carried out together with Regiments Capital, a company associated with the Gupta family, some of whom have refused to return to South Africa from Dubai to face graft charges.

“The judicial commission has confirmed there is no information that implicates any current personnel of McKinsey in any corruption or impropriety,” the company said in a statement on Wednesday. “The repayment decision was made following the Judicial Commission’s recent introduction of documents and information regarding Regiments previously unavailable to our review.”

McKinsey is one of a number of international companies caught up in South African graft probes mainly targeting firms doing business with state entities. SAP AG and KPMG LLP are two of the companies mentioned.

“The Commission commends McKinsey for taking the step that it has taken,” it said in a separate statement. “The Commission urges other companies to follow its lead and do the same in all cases where evidence shows that they have benefited from contracts tainted by corruption, even if they were not party to that corruption.”

Of the 10 affected contracts, nine were with Transnet and one with SAA. Transnet disputed the amount McKinsey plans to pay, saying the contracts amounted to R688 million plus almost R558 million in interest.

“The amount owed to Transnet, therefore, is just over R1.2 billion, and that is what we continue to insist must be repaid,” the company said in a statement. “In July 2018 McKinsey agreed to return the fees earned at Eskom, plus interest, in similar circumstances.”

McKinsey has previously repaid about R1 billion to Eskom Holdings SOC Ltd., the state power utility.

“This situation is a source of great regret to McKinsey,” said Kevin Sneader, McKinsey’s global managing partner, in the statement. “Over the past three years, McKinsey has accepted responsibility for the errors of judgment that were made and continues to work hard to make amends.”

© 2020 Bloomberg

BUSINESS VIDEOS

COMMENTS   3

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

McKinsey is Dishonest Company – Think twice before working for this lot!

They cannot clear their name!
They are part of state capture!

“The repayment decision was made following the Judicial Commission’s recent introduction of documents and information regarding Regiments previously unavailable to our review.”.

In other words they didn’t know that SA also had a copy of the documents. The US Government needs to look into criminally prosecuting this US company’s employees just like they did with Goldman Sachs re: Malaysia. It is revealing that they kept non Eskom money linked to the Guptas until they reviewed the documents they didn’t know anyone else had before they hand back the SAA/Transnet cash. Did they honestly think that money was clean?

McKinsey, just pay up and go back to the USA (Moodys and Fitch country).

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: