Frayed tempers, legal threats mark KPMG hearing
Ntsebeza Inquiry on ice for two weeks while implicated individuals prepare their responses
The Ntsebeza Inquiry was on Wednesday postponed for two weeks after a dramatic day of frayed tempers, heated arguments behind closed doors and threats of legal action by KPMG and other parties.
The inquiry is examining KPMG staff’s alleged role in the state capture scandal and the second day of the inquiry was marked by long delays as legal representatives of some of the 47 implicated individuals made submissions to the panel and evidence leaders.
The inquiry, chaired by Advocate Dumisa Ntsebeza, will resume on March 8.
The inquiry was established by the South African Institute of Chartered Accountants (Saica) to look into the conduct of individual chartered accountants and auditors employed by KPMG. It will determine if they violated the institute’s code of conduct in auditing unlisted Gupta companies. It is also looking into a report compiled by KPMG on the so-called SARS “rogue unit”.
Times Select has established that there are five complaints against individuals currently and formerly employed by KPMG.
The complainants are SARS and four individuals, including a former partner at KPMG.
Ntsebeza apologised for the delay but said he and his five-member panel had agreed on the postponement “in the interest of fairness”.
“We have determined what needs to be done in the interest of getting the process going but in a manner that accommodates all the parties who are participants in this process,” Ntsebeza said.
Evidence leader Advocate Pule Seleka said it had been “a balancing act”.“We met with the legal representatives of the parties and the inquiry had to deal with certain legal threats … to interdict the proceedings if parties are not afforded enough opportunity to make their case before this inquiry, or if they are not given an opportunity to examine those who are making adverse allegations against their clients,” Seleka said.
He said KPMG and legal counsel for the nine former KPMG executives who resigned in the wake of the state capture allegations had requested more time to examine the submissions by the complainants. They wanted time to prepare for cross examination of witnesses.“This is a period that is being provided in the interest of fairness to all those who will be impacted upon adversely by all the allegations. The time, I understand from everything that I have been told, was considered to be inadequate but we indicated that we don’t have forever,” Ntsebeza said.
He said the delay would enable the inquiry to run almost uninterrupted when it resumed.
On Monday the inquiry heard that KPMG International was reluctant to provide a report it had conducted into KPMG SA’s work for the Guptas and SARS, citing confidentiality.
The report led to the resignation of nine KPMG executives including the CEO Trevor Hoole and board chairman Ahmed Jaffer.
"KPMG SA called for this independent inquiry and welcomes this process. We are unaware of any action to halt the Inquiry," said KPMG spokesperson Nqubeko Sibiya.
"The firm remains committed to fully cooperating with the Inquiry’s information requests and to this end, has offered the Panel access to the firm’s policies and procedures."
The training policy document, which must adhere to Saica regulations, came under scrutiny during proceedings on Wednesday after it emerged KPMG had refused to provide it to the inquiry, citing confidentiality.
Note: This article has been updated to reflect KPMG's comments.