The Telegraph
More than seven years have elapsed since Markus Jooste resigned as CEO of Steinhoff on December 5, 2017, prompting the supervisory board to engage PWC for a forensic inquiry into accounting fraud at the once-mighty global retail giant.
The inquiry lasted over a year, resulting in an extensive 7,000-page report, alongside 4,000 pages of supplementary documents, which was presented to Steinhoff’s supervisory board in March 2018.
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Read: Former Steinhoff CEO Markus Jooste has died [March 2024]
It was not until March 15, 2019, that Steinhoff provided a brief summary of the findings, stating that the PwC Report held privileged information and that full disclosure would impede efforts to recover losses.
“The PwC Report is confidential and shielded by legal privilege and other restrictions. Therefore, SIHNV (Steinhoff International Holdings NV, listed in Frankfurt) currently does not intend to release the report…” it indicated in an 11-page summary released at the time.
“By publishing this summary, we do not waive the confidentiality and legal privilege associated with the PwC Report,” it further explained.
Read:
Ex-Steinhoff finance chief Ben la Grange sentenced to 5 years in prison [Oct 2024]
Hawks arrest Jooste’s associate in Steinhoff insider trading case [Sept 2024]
Markus Jooste’s death won’t affect Steinhoff investigation – FSCA [March 2024]
Markus Jooste fined R475m for Steinhoff misconduct [March 2024]
Steinhoff report uncovers numerous conflicts of interest [March 2019]
The PwC Report summary confirmed that allegations of accounting fraud were valid; however, it withheld the names of those deeply involved.
“A small group of former executives from the Steinhoff Group and certain outsiders, led by a senior management figure, orchestrated and executed various transactions over many years, which significantly inflated the profit and asset values of the Steinhoff group over an extended period.
“The PwC inquiry uncovered a communication pattern indicating the senior executive directing a select group of Steinhoff executives to implement those orders, often assisted by a few individuals not employed by the Steinhoff group,” it elaborated.
It was noted that none of the Steinhoff executives identified in the report remained with the company at that time.
“Fictitious and/or irregular transactions were conducted with parties represented as independent third entities, which now seem to have close ties or be controlled by the same small group mentioned earlier.
“In numerous cases, fictitious or irregular income was generated at an intermediary holding company level, later assigned to underperforming Steinhoff operational entities as various forms of ‘contributions’ that either inflated income or reduced expenses within those entities,” the report summary specified.
The cumulative impact of these sham transactions led to an income increase of €6.5 billion from 2009 to 2017.
Still undisclosed
This included News24, a publisher of several newspapers and online platforms, Arena Holdings, which publishes Financial Mail and Business Day, and Rob Rose, former Financial Mail editor and author of a book on the Steinhoff scandal.
Steinhoff, now rebranded as Ibex Holdings following the restructuring of the remnants of Steinhoff, transferred the report to the media outlets on December 18.
However, since then, little information has been revealed to the public. The newspapers may be awaiting their readers’ return from holiday. Furthermore, 7,000 pages represent a significant volume to review, and there could be legal consequences in publishing it entirely. Media organizations might need to consult their legal teams concerning any potential stories arising from the full report.
Read:
Ben la Grange – a missed chance for justice [Oct 2024]
JSE censures, fines, and ‘disqualifies’ former Steinhoff CFO Ben La Grange [Aug 2022]
Steinhoff is funding the police investigation into its affairs, not the NPA’s [March 2021]
Steinhoff/Deloitte settles R1.22bn deal with claimants [Feb 2021]
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Ibex announced in a press release that the media outlets’ request for access to a copy of the PwC report was filed against Steinhoff on October 23, 2019.
“On May 10, 2022, the High Court ordered that Steinhoff must provide the media parties with a copy of the PwC Report. Steinhoff subsequently appealed to the Supreme Court of Appeal [SCA]. The appeal was heard on May 27, 2024, and the judgment was delivered on December 4, 2024.
“Ibex will adhere to the court’s directive and will not contest the ruling,” it stated.
Read/listen:
Sarb’s renewed focus on asset forfeiture [Oct 2024]
Fraud mechanisms yet to be uncovered in the Steinhoff case [Oct 2024]
Steinhoff liable for R6.2bn [July 2024]
The ‘Steinheist’ saga launching on Showmax [Sept 2022]
Moneyweb’s plea for a copy of the report was denied.
“The PwC Report remains confidential, and specific content is protected under the legal safeguards provided by the Protection of Personal Information Act (Popia). Therefore, we lack the legal grounds to provide you with the PwC Report,” it explained.
“Any request for access to the PwC Report must be formally submitted in accordance with Paia. Each request will be assessed by Ibex RSA Holdco Limited based on its merits on a case-by-case basis,” Ibex responded to Moneyweb through their media contact.
“If you gain access to the PwC Report through any means, please understand that you are responsible for the information contained within it in compliance with applicable local and international laws, including Popia,” it added.
Read:
As Steinhoff departs from the market, discover who profited billions [July 2023]
Steinhoff: Deloitte now under scrutiny [July 2021]
Steinhoff’s origins in deception – report [Nov 2018]
The vastness of the Steinhoff deception [July 2018]
Ibex also issued a separate statement to clarify its position regarding the disclosure of individuals’ personal information included in the report.
“Following the SCA ruling, the PwC Report will be distributed to the media parties on Wednesday, December 18, 2024. This disclosure is mandatory, and Ibex is legally obliged to comply with the SCA’s ruling.
“The PwC Report contains personal information concerning individuals and corporate entities [‘affected data subjects’], primarily those who were employed by the Steinhoff Group and businesses that collaborated with the group. The disclosed personal information comprises names, contact details, correspondence, and interviews.
“In accordance with the stipulations under the Protection of Personal Information Act, Ibex intends to notify affected data subjects about the disclosure of their personal information to the media parties and the circumstances surrounding it,” they indicated.
Listen to SAfm Market Update presenter Jimmy Moyaha interviewing Rob Rose, editor of Currency, former Financial Mail editor and author of Steinheist:
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