EDINBURGH — Expect to hear a lot more about Moses Kgosana, the KPMG heavyweight linked to the Gupta tax dodge that facilitated a flow of R30m from taxpayers to cover an extravagant family wedding at Sun City. That wedding is the event that raised alarm bells that the Gupta family exerted 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 – but sanctioned by #1. 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. The journalists at amaBhungane reveal 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. Now he is facing an investigation into his role in the country’s worst financial scandal in decades.- Jackie Cameron
Profile: Moses Kgosana – quick snapshots
Moses Kgosana shoots the messenger as he feels the heat – WATCH!
In the Gupta cross-hairs: Moses Kgosana, former KPMG CEO, says he is on a mission to clear his name as a Gupta lapdog and will co-operate with the regulator to ‘put the truth on the table’.
What amaBhungane says about Moses Kgosana:
Auditors are supposed to be independent, note the journalists. But the Guptas’ cosy relationship with Moses Kgosana, KPMG’s then chief executive and the KPMG partner directly responsible for their audit, begs the question: why are South Africans only now learning about the public funds behind the Guptas’ notorious Sun City wedding?
“Rather than being an independent watchdog, KPMG’s dealings with the Guptas leave the impression that the auditor was the family’s lapdog.
Regarding the Sun City nuptials, KPMG Africa’s top executive Moses Kgosana gushed to Atul Gupta, “My wife and I were privileged to attend and enjoyed every moment and every occasion. I have never been to an event like that and probably will not because it was an event of the millennium.”
AmaBhungane journalists uncovered the following email, which reveals that Moses Kgosana reached out to Atul Gupta for a personal favour:
AmaBhungane has published details of complex financial transactions that facilitated the flow of money from state coffers, in the Free State, into Gupta entities. These funds were used to foot the bill for the Gupta Sun City wedding and were deducted as a business expense. These steps ensured that the Gupta wedding was a complete freebie for the Gupta family and its guests, which included politicians and media bosses. For more, read: Revealed! Taxpayers picked up tab for THAT big fat Gupta wedding – guided by KPMG
What leading economist Iraj Abedian says about Moses Kgosana, KPMG:
Chair and Chief Executive of Pan-African Investment and Research Services Dr Iraj Abedian told Daily Maverick that KPMG staff should face the music for involvement in Gupta deals.
“There are three issues that needed clear resolution; the suspension of KPMG’s licence as a firm (at least in South Africa); the suspension of the specific KPMG auditors and professional forensic staff who had over the years been involved in the many Oakbay companies (and maybe others) that had engaged in unethical bookkeeping and accounting practices, and the penalty that KPMG needed to pay for having caused a multibillion rand loss to South African taxpayers,” he said.
Abedian said it was clear that over the years KPMG had been aware of “all kinds of questionable transactions” in various companies in the Gupta Group.
“That it chose to remain silent for so long is a serious matter of unethical conduct,” and has the “hallmarks of Arthur Anderson written all over it”.
What BusinessLive says about Moses Kgosana:
“KPMG’s clean audit of Gupta family companies is at odds with its description of itself on its website as a market leader in money-laundering prevention,” says Linda Ensor.
“Moses Kgosana, who was CEO of KPMG SA at the time, said by phone on Friday that the auditor did not know about the payments. It would have been obliged to raise them with the Independent Regulatory Board for Auditors, had it known, he said.”
What Bloomberg says about Moses Kgosana:
“Moses Kgosana, who withdrew from taking the post as chairperson of Alexander Forbes Group Holdings in the wake of allegations related to his tenure as chief executive officer and senior partner at KPMG South Africa, said he offered to step aside from the position.
“Public opinion was attracting unfair comment to Alexander Forbes and its clients,” he said in an interview broadcast on Johannesburg-based Radio 702 on Tuesday. “That was why I offered to step aside. It was not an admittance that I did something wrong.”
KPMG South Africa failed to raise alarms when businesses controlled by the Gupta family, who are friends of President Jacob Zuma and in business with one of his sons, diverted the equivalent of R30m of public money to pay for a family wedding, according to emailed communication.
The audit firm has said it never condoned money laundering and will cooperate fully with the Independent Regulatory Board for Auditors in their investigation. Zuma and the Gupta family have denied any wrongdoing.
“I am ready to answer and cooperate with the regulator,” Kgosana said. While queries were raised over the account by the lead auditor, the “buck did stop with me as the CEO,” he said.
Bloomberg profiles Mr. Moses Kgosana:
With an Hons BCompt, CA (SA), he serves as an Executive Chairman of Peduco Properties Investments. Mr. Kgosana served as Chief Executive of KPMG in South Africa and Chairman of KPMG Africa, representing the region on the KPMG EMA and KPMG International Boards.
If the Gupta emails were fake, why would Moses Kgosana resign from Alexander Forbes Board? #GuptaLeaks
— Mncane Mthunzi (@mncanem) July 3, 2017
He has 34 years of accounting, audit and advisory experience in the public and private sectors. He has been a Non-Executive Director of AECI Ltd. since September 2016. He also serves on the Boards of inter
AccountancySA on Moses Kgosana: ‘humble hero who leads through inspiration’:
“How does one manage a team of more than 260 partners, each of which thinks he or she knows better than you, and at least half of whom probably do? You start off by being humble, explained Moses Kgosana, CEO and senior partner at KPMG, in 2013.
Kgosana was elected by his peers as KPMG CEO in 2006 – its first black CEO and the first black CEO of a ‘Big Four’ auditing firm in South Africa, says accountancysa.org.za.
Five years ago, KPMG bragged that it had 67 black partners (comprising a quarter of the total partner body), a quarter of the total number of partners who were female (with 28 black female partners) and 44% of the entire staff black.
Kgosana’s “personal accomplishments were achieved the hard way, even in a community where almost any successful black businessman can boast of humble origins. During the early years of his education, he alternated days of school and work with his brother in order to tend the family farm. From Std 4 or grade 6 onwards he paid entirely for his own education and text books through casual jobs, studying mostly part time to get a matric and university education through UNISA.
— Xoli Mngambi (@XoliMngambi) July 4, 2017
“This instilled a discipline of hard work and persistence which enabled me to succeed and also set many of the values which I hold dear till today,” said the industry website.
After articles he went into commerce and industry, working for various organisations including New Africa Investments Limited (Nail) with Dr Nthato Motlana, one of the founders of the MTN Group. He formed KMMT, his own firm.
“This became one of the largest black audit firms in South Africa, and its eventual merger with KPMG was not universally praised,” said accountancysa.org.za.
Kgosana believes he has “values and principles which not only stand him in good stead as a leader, but which have been inculcated into KPMG and been warmly received”.
“I have a public persona – I am seen less as Moses Kgosana and more as the KPMG CEO. For this reason, I have to take particular care in my personal deportment and I did so from the moment I joined KPMG.
— P.O.E.S (@whatapoes) July 2, 2017
“People have to realise that accepting a position with an organisation is about much more than accepting a salary. In my daily life I live certain values such as leading by example, being honest and open in my communication, respecting the individual and acting with integrity. These are not qualities one should have to boast about – they should be natural assumptions in any organisation – yet I have seen companies that do not. I have reinforced these at KPMG and believe these qualities talk to our reputation.
“Quality, trust and integrity are vital in this profession, and for this reason I have a personal relationship with our top 30 companies. They all know me, and know I am on call when needed,” he says.
Independent Regulatory Board for Auditors starts a probe into Moses Kgosana, KPMG:
The Independent Regulatory Board for Auditors (IRBA), the audit watchdog, has initiated an investigation into the Gupta wedding scandal.
Says Bernard Agulhas, CEO of the IRBA: “While we have not received a formal complaint, we have nevertheless initiated our own probe into the audit of Linkway Trading by KPMG for its audit in 2014. It is important that we take seriously allegations in the public domain, which are in the public interest.”
The investigation may be initiated despite the fact that KPMG terminated its 15-year relationship with the affected companies in 2015. Notices have been issued to the auditors and the audit firm has also been informed.
Moses Kgosana wasn’t the only KPMG partner who attended the lavish Gupta wedding:
Says KPMG Southern Africa CEO Trevor Hoole: “The wedding took place in 2013 and attendance by some of our Partners was approved at that time by our Risk Management team and Executive Committee. The accommodation and travel costs were borne by KPMG. We are satisfied that our independence was not impaired at any stage.”
“We strongly refute allegations that KPMG was involved in, or condoned, any alleged money laundering activities.”