PREMIUM FREE TRIAL

Gupta tax dodge scandal: 7 questions KPMG bosses DON’T want to answer

EDINBURGH — Big four accounting firm KPMG has been exposed for helping the controversial Gupta family divert taxpayers’ funds into a private family wedding. It is also linked to helping the Gupta family dodge tax on these funds. BizNews visitors want more information about this scheme, asking how KPMG and its senior employees have accounted for Gupta hospitality in their tax returns. BizNews put the questions to KPMG a week ago. So far, KPMG hasn’t provided answers. – Jackie Cameron

Staff writer

Auditing firm KPMG has been thrust into the limelight for its relationship with the Gupta family – Indian immigrants at the centre of a state capture scandal that has engulfed South Africa.

KPMG helped the Gupta family divert taxpayers’ funds to pay for an extravagant family wedding at Sun City and went one step further in ripping off taxpayers by helping the family to avoid paying tax on the funds.

Ajay, Atul and Tony Gupta have worked closely with President Jacob Zuma’s friends and family to tap state coffers, amassing huge wealth for themselves and President Zuma’s son Duduzane in the process.

Moses Kgosana, former KPMG boss and the first black CEO of a ‘big four’ accounting firm, has been linked to an accounting manoeuvre that facilitated state payment for a Gupta private event believed to have cost about R30m.

The wedding is the event that raised alarm bells that the Gupta family was exerting extraordinary influence at the highest levels of government in South Africa.

The Guptas were allowed to land a jet of private guests at a state airforce base, which was illegal and irregular.

Journalists at amaBhungane revealed that Kgosana has had much more than a bit part in the Gupta state capture scandal.

He attended the controversial Sun City wedding as a guest and tried to use his personal relationship with Atul Gupta to put the screws on journalists at a Gupta-owned media company following a ‘negative’ report about KPMG. Moses Kgosana was the first black CEO of a ‘big four’ accounting firm after building his career from humble roots.

Revealed! Taxpayers picked up tab for THAT big fat Gupta wedding – guided by KPMG. More of Zapiro’s magic available at www.zapiro.com

Corruption Watch has slammed KPMG’s conduct.

BizNews visitors have highlighted that the abuse of taxpayers’ funds aren’t the only factors about the KPMG wedding extravaganza that should be probed.

They have asked questions about how KPMG individuals who attended the wedding accounted for the junket in annual income tax returns.

BizNews put the questions to KPMG chief executive officer Trevor Hoole – but he has not responded to the request for answers. He has directed the questions to the marketing department.

Here are seven questions BizNews visitors are asking about KPMG:

  1. Which KPMG employees attended the Gupta wedding? It seems a number of KPMG delegates attended the Sun City wedding in 2013.
  2. Who paid for the travel and accommodation of the KPMG guests? 
  3. If a Gupta company paid for accommodation, then what about auditor independence?
  4. If KPMG paid for accommodation, has KPMG claimed it as a “business expense” and set off against taxable income? It would seem that this is not a business expense.
  5. If KPMG paid for accommodation and didn’t claim as a “business expense”, was the rand value of this accommodation added to the KPMG employees’ taxable income? If the value wasn’t added into individual tax returns, why not?
  6. Did KPMG give a corporate present to the Gupta bride and groom? Please stipulate what it was and the value. If it didn’t give a present to the Gupta bride and groom, why not if they were invited in their capacity as KPMG contacts?
  7. If KPMG did not give gifts to the Gupta bride and groom, did the KPMG employees? If so, what gifts were given?
Zapiro’s archival cartoon on the controversial Gupta Sun City wedding still rings true. More of his magic available at www.zapiro.com.

McKinsey, KPMG, SAP, Bell Pottinger: Working for the corrupt and captured

The stories you might have missed about the big companies involved in the state capture scandal:

1. McKinsey turns on its own as explosive SA-Gupta graft scandal erupts

The McKinsey name was highlighted in an investigation into corrupt deals involving the controversial Gupta-linked Trillian Capital Partners. At the weekend, it emerged that McKinsey has suspended one individual. It’s a case of too little, too late for many South Africans who ponder why McKinsey and other companies have taken so long to take a stand against the corrupt and captured within their own ranks.

2. Meet unrepentant Gupta tax dodge ‘lapdog’ Moses Kgosana, KPMG heavyweight

Moses Kgosana was about to take the chair at Alexander Forbes Group Holdings when his name emerged in secret emails leaked from the heart of the Gupta family empire. He has been linked to an accounting manoeuvre that facilitated state payment for an extravagant private event. Read more.

3. Revealed! Bell Pottinger got R5.5m for one weekend to ‘help’ ANC, MK in anti-white campaign

The #GuptaLeaks reveal that the Zupta account has been so lucrative for Bell Pottinger that it sent an invoice for just under £350 000 (about R5,5m), for a four-day trip that included a suggested speech for Collen Maine of the ANC Youth League and a statement for the MK Veterans AssociationRead more.

4. Corrupt SAP exposed. Gupta bribery to suck in US, Germany authorities

One of the world’s biggest business software companies SAP may find itself in hot water with German and US regulators after being embroiled in a massive Gupta kickback deal.Investigative journalism unit, AmaBhungane, released a bombshell report on Tuesday that details how SAP, in August 2015, agreed to pay a 10% “sales commission” to a Gupta-linked company in return for Transnet deals. Read more.

For a deeper understanding of the world of money and greater financial control, upgrade to BizNews Premium.