SIU takes aim at Oracle in treasury corruption probe

Special Investigating Unit head Andy Mothibi told parliament on Wednesday that the SIU will immediately embark on civil proceedings in the Special Tribunal to cancel national treasury’s contract with the world’s largest database management company, Oracle, and, if possible, recover the money.

The SIU statement, to parliament’s standing committee on public accounts (Scopa), followed a four-year investigation into a whistle-blower report alleging corruption and irregularities in procurement processes for government’s integrated financial management system (IFMS), awarded to Oracle South Africa in 2016, in which a senior treasury official was implicated.

TechCentral first reported on the alleged corruption around the deal in 2019.

Treasury paid nearly R1-billion to Oracle South Africa for the financial management system intended to integrate government’s IT systems and update its human resource and supply chain systems; and it still insists there was no corruption involved in its dealings with Oracle.

But Scopa chair Mkhuleko Hlengwa criticised treasury for refusing to acknowledge that the project was corrupt and said it was a “glaring indictment” of its performance. “This set a bad example for the rest of the government, as treasury should be held to the highest standard.”

Mothibi said a four-year investigation into the tender found evidence of a conflict of interest between senior treasury officials and Oracle.

High-level findings also found evidence of irregular supply chain management (SCM) processes, non-compliance with SCM policies and legislation, and fruitless and wasteful expenditure.

“The execution will not wait. We have the essential legal findings supported by evidence and that means we can proceed. The evidence that treasury presented to us was not materially new and so the outcomes stand.”

Oracle blacklisting

The “outcomes” Mothibi was referring to include two disciplinary referrals, a blacklisting referral and five criminal matters referred to the National Prosecuting Authority, although Mothibi said the individuals’ names cannot be mentioned until they have been criminally charged.

“There will be blacklisting of the service provider (Oracle). By law, when we find evidence of wrongdoing, we are required to report it to the NPA and they will proceed with the Hawks,” he said. “A senior counsel and a litigation team has already been appointed to go ahead with civil proceedings to terminate the contract and recover money, depending on the loss.”

Read: Oracle ‘no comment’ on IFMS corruption allegations

When TechCentral first reported about corruption concerns surrounds the contact in 2019, the US software giant issued a stern “no comment” to accusations that it hired a former senior national treasury official, whose name is know to TechCentral, in order to secure the contract.

A sign on an Oracle office building in Silicon Valley, California. Image: ykanazawa1999

Mothibi said presenting the report to President Ramaphosa, who requested the investigation in 2020, was virtually a formality as he said the president had always respected legal due process.

Oracle South Africa could not be reached for comment on Thursday.  – © 2024 NewsCentral Media

Get breaking news alerts from TechCentral on WhatsApp