It has been over seven years since Markus Jooste resigned as the CEO of Steinhoff on December 5, 2017. His departure led the supervisory board to seek the advisory help of PWC for a forensic probe into the accounting fraud that plagued the once-prominent global retail giant.
The inquiry lasted more than a year and resulted in a comprehensive 7,000-page report, along with an additional 4,000 pages of supporting documents, which were presented to Steinhoff’s supervisory board in March 2018.
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Read: Former Steinhoff CEO Markus Jooste has died [March 2024]
Commonly known as the PwC Report, it attracted significant public and media attention regarding its conclusions, especially about who was aware of the fraud and the principal individuals responsible.
It wasn’t until March 15, 2019, that Steinhoff shared a brief summary of the findings, asserting that the PwC Report contained privileged information and that complete disclosure would impede recovery efforts for the associated losses.
“The PwC Report is confidential and protected by legal privilege and other limitations. Therefore, SIHNV (Steinhoff International Holdings NV, listed in Frankfurt) does not currently intend to publish the report…” stated an 11-page summary released at the time.
“By releasing this summary, we do not waive the confidentiality and legal privilege linked to the PwC Report,” it added.
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 summary of the PwC Report affirmed the legitimacy of the claims surrounding accounting fraud; however, it did not reveal the identities of the key individuals involved.
“A small group of former executives from the Steinhoff Group and several non-Steinhoff executives, led by a senior management figure, orchestrated and executed various transactions over many years, which led to a significant inflation of the profit and asset figures of the Steinhoff group over an extended period.
“The PwC investigation uncovered a pattern of communication where the senior executive directed a select group of Steinhoff executives to follow through on those directives, often aided by a few individuals not employed by Steinhoff,” it explained.
It was emphasized that none of the Steinhoff executives mentioned in the report were still employees of the company at that time.
“Fictitious and/or irregular transactions were conducted with parties represented as independent third entities, which now seem to be closely linked to or controlled by the aforementioned small group.
“In numerous cases, false or irregular income was produced at an intermediary Steinhoff holding company level, which was later attributed to underperforming Steinhoff operational entities as various forms of ‘contributions’ that either inflated revenues or reduced expenses for those entities,” detailed the summary of the report.
The aggregate impact of these fraudulent transactions resulted in a reported income increase of €6.5 billion from 2009 to 2017.
Still Undisclosed
The entire PwC Report remains under tight control, despite a High Court order requiring Steinhoff to supply it to specific media outlets that sought legal action under the Promotion of Access to Information Act (Paia).
These included News24, which publishes various newspapers and online portals, Arena Holdings, the publisher of Financial Mail and Business Day, and Rob Rose, former Financial Mail editor and author of a book about the Steinhoff scandal.
Steinhoff, now rebranded as Ibex Holdings after restructuring its remains, sent the report to the media outlets on December 18.
However, since then, minimal information has been released to the public. It is possible that the newspapers are waiting for their readers to return from holiday. Furthermore, a total of 7,000 pages is a considerable amount to sift through, and there may be legal ramifications related to publishing it verbatim. Media organizations may require consultation with their legal teams regarding any potential stories based on 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 declared in a press release that the media entities’ request for access to a copy of the PwC report was initiated against Steinhoff on October 23, 2019.
“On May 10, 2022, the High Court ordered that Steinhoff must hand over a copy of the PwC Report to the media parties. Steinhoff later appealed this decision to the Supreme Court of Appeal [SCA]. The appeal was heard on May 27, 2024, with the judgment announced on December 4, 2024.
“Ibex will adhere to the court’s ruling and will not contest the judgment,” it affirmed.
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 request for a copy of the report was denied.
“The PwC Report remains confidential, and specific details are safeguarded under the legal protections provided by the Protection of Personal Information Act (Popia). Hence, we do not have the legal grounds to simply provide you with the PwC Report,” it explained.
“All requests for access to the PwC Report must be formally submitted per Paia. Each request will be assessed by Ibex RSA Holdco Limited on a case-by-case merit basis,” Ibex communicated to Moneyweb through their media representative.
“If you manage to access the PwC Report through any means, please be aware that you are responsible for the information contained therein 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 outlining its position regarding the disclosure of individuals’ personal information contained within the report.
“Following the SCA ruling, the PwC Report will be shared with the media parties on Wednesday, December 18, 2024. This disclosure is mandatory, and Ibex is legally obligated to follow the SCA’s ruling.
“The PwC Report includes personal information about individuals and corporate entities [‘affected data subjects’], primarily those employed by the Steinhoff Group and businesses that worked with the group. The disclosed personal information encompasses names, contact details, correspondence, and interviews.
“In accordance with the provisions under the Protection of Personal Information Act, Ibex plans to notify the affected data subjects about the disclosure of their personal information to the media parties and the circumstances surrounding it,” they stated.
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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