On Friday, 26 May, the US Securities and Exchange Commission (SEC) published an order that found Connecticut-based tech firm Gartner in breach of anti-corruption legislation involving local businessmen, top officials at the South African Revenue Service (SARS) and two 2015 tech contracts worth R200-million.

Eight years after the crime, the SEC found that Gartner, listed on the New York Stock Exchange, contravened anti-bribery, books and records and internal accounting control provisions of the US’s Foreign Corrupt Practices Act.

The firm agreed, without admitting or denying the allegations, to a cease-and-desist order not to repeat these crimes and to pay disgorgement and prejudgment interest of $856,764 plus a $1.6-million civil penalty (altogether about R50-million at the current exchange rate) to the US Treasury. That Gartner self-declared the crimes to the SEC offers perspective on the firm’s unwillingness to officially admit to the findings.

Gartner’s run-in with the SEC is backgrounded by how former tax boss Tom Moyane captured SARS between 2014 and 2018. The contract was also probed by the South African Nugent Commission of Inquiry into SARS and detailed in Chapter 5 of its 200-page report dated December 2018.

Judge Robert Nugent, the commissioner, was tasked by the then newly appointed President Cyril Ramaphosa to investigate what happened at SARS during Moyane’s four-year tenure, which was aided greatly by Moyane’s triggerman, chief operations officer Jonas Makwakwa.

Meticulously scrutinised and carefully considered, the Nugent report explained why the canaries had died in the halls of Moyane’s SARS.

Moyane, lest we forget, was the confidant and friend of then president Jacob Zuma who, in February 2018, resigned after Daily Maverick and its media partners published the #GuptaLeaks. Zuma had parachuted Moyane into the world-renowned institution in September 2014 to bring SARS to heel because its ace investigators had become a pestilence to the president’s family and benefactors.

Moyane held secret meetings in the run-up to his appointment with Boston-based consulting firm Bain & Co, Makwakwa and his long-standing, questionable friend Patrick Monyeki. Monyeki’s business fortunes had in the decade up to that point been closely tied to Moyane’s appointments in government. Where Moyane went, Monyeki and dodgy tenders seemed to follow.

In an investigation I published in September 2018, I reported that lucrative contracts at the Department of Correctional Services, the Government Printing Works, the State Information Technology Agency and the South African Social Security Agency (Sassa) involving Monyeki’s companies were being investigated for a range of alleged criminalities. In these instances, Moyane appears to have been his blesser.

The Nugent report further laid the breadcrumbs of what should be done to heal the traumatised SARS. Included in these recommendations were that new SARS management should consider setting aside the Gartner contracts and recover the R200-million incurred that added no value to SARS.

Daily Maverick and other media houses at the time covered the Nugent Commission in detail and published our own investigations documenting the collapse at SARS.

Gartner’s self-disclosure to the US authorities, the SEC order tells us, seems to have been triggered by “press reports in [SA]”.

Though the SEC order omits some details, such as the names of Monyeki, his tech firm Rangewave Consulting, Moyane and Makwakwa, there is enough detail, when comparing it with the Nugent report and my own SARS investigations, for us to add some missing pieces.

Crucially, these include:

• The SEC order accepted as fact a possibility that local journalists and the Nugent Commission could not speculate about in writing – that Monyeki quite possibly bribed Moyane and Makwakwa, and that Gartner officials were aware of this. The SEC order document states that Gartner “knew or consciously disregarded the high probability that [Patrick Monyeki] would offer, provide or promise” money to “SARS officials for the purpose of influencing such officials to obtain or retain business for Gartner”;
• Either Gartner officials may have perjured themselves in front of the SEC or Gartner’s local representative, Neville Willemse, may have perjured himself in front of the Nugent Commission – it seems unlikely that their two versions under oath can both be true at the same time;
• The Hawks and National Prosecuting Authority (NPA) had been pipped to the post by a foreign authority in getting some justice for a crime committed in South Africa; and
• Gartner ignored its own risk assessment that identified potential “bribery red flags”. When the SA media started writing, Gartner’s management realised it was in deep trouble with the US authorities for committing crimes in another region of the world, and were so convinced of adverse consequences that officials decided to self-report their crimes to the SEC.

There is no public evidence that Gartner offered the same courtesy – and had the same certainty of adverse repercussions – to SA authorities. In fact, the testimony of Gartner’s local representative, Willemse, was found by the Nugent Commission to have been quite doubtful and, as we will show later, he may well have perjured himself in front of the commission.

Gartner’s penalties for crimes committed in South Africa will be paid to the US Treasury’s account, and for that country’s benefit. In the eight years since the tender crimes were committed and, despite Gartner’s then head of public sector consulting, Michael Lithgow, testifying at the Nugent Commission that Gartner had “completely failed” at SARS and added no value to the institution for the R200-million it received, the Hawks and NPA investigators have chosen to keep themselves busy elsewhere.

Illustrative image: Former president Jacob Zuma. (Photo: Gallo Images / Netwerk24 / Felix Dlangamandla) | Former South African Revenue Service commissioner Tom Moyane. (Photo: Gallo Images / Phill Magakoe) | The SA Revenue Service building in Cape Town, South Africa. (Photo: Gallo Images / ER Lombard)

This is what happened:

“The client [SARS] has proposed that we use a small company [Rangewave Consulting] that is led by an ex Government CIO [Monyeki] whom Neville [Willemse] knows,” Gartner’s Lithgow wrote on 13 January 2015 in an email after a phone call from Willemse. “This would add the necessary ‘proportion’ of Black Empowerment…”

Except everyone knew this was a lie.

Willemse was linked to a local firm called Zimeleyo Research & Consulting, which acted as Gartner’s South African agent and was fully B-BBEE compliant.

Everyone also knew that SARS officials were not allowed to propose who the international firm should work with.

Another red flag was that the job didn’t come to Gartner in the form of a tender published by SARS at all. It was Monyeki who, in late December the previous year, hooked Willemse with the sweet-sounding deal. The SARS boss wanted to review the institution’s world-renowned IT system, Monyeki told Willemse, and Gartner was the firm earmarked to do it. The catch was that, “in order to win the [SARS] contracts on a sole-source basis”, Monyeki’s firm, Rangewave Consulting, was to be used as subcontractor and receive 50% of the alleged loot.

Just four days earlier, on 9 January 2015, another internal Gartner email between managers illustrates that everyone knew they were being herded – and the sheepdog biting at their ankles was called Patrick Monyeki: “Both the client and [Rangewave] are quite savvy … [Rangewave] knows that we cannot bid without them.”

By this time, Monyeki and Willemse had already drafted the necessary terms of reference for the SARS project – unlawful under SA tender prescriptions because it meant Gartner and its future business partner were drafting the specs on behalf of SARS that they were in the end supposed to bid on in what should have been a competitive process.

On the same day, 9 January 2015, Makwakwa asked Gartner to expand on the specs it drafted and suggested Gartner use Rangewave in order to qualify under B-BBEE. In this process, Gartner negotiated Rangewave down to 40% because it carried all the risk, its managers said.

At this point, Willemse and his testimony before the Nugent Commission deserve special scrutiny. When Makwakwa asked for an expanded scope, “Mr Willemse said at that point he realised that Gartner did not have sufficient people to do the additional work. Knowing that Mr Monyeki’s company, Rangewave, had access to consultants on contract, he asked Mr Monyeki if he could use their services,” the commission’s final report summarises Willemse’s testimony.

But thanks to the SEC order, which extensively quotes from Gartner evidence gathered, we know Willemse’s testimony seems to be a bleached tale in complete contradiction to his company’s version. According to Gartner internal emails and testimony before the SEC, it was Monyeki who approached Willemse to pull in Gartner, and it was Makwakwa (and by implication, Moyane) who ensured that Monyeki received the huge 40% chunk of the alleged loot thanks to the false B-BBEE ruse.

Willemse further told the Nugent Commission that he did not know about the special relationship between Monyeki and Moyane. Yet, thanks to the SEC investigation, we know that internal Gartner emails again suggest this may not be true, as Monyeki was referred to as “extremely well connected within Government and SARS”. Where else, the reader should ask, would international Gartner officials have gleaned that information from, other than from their South African partner? Additionally, Monyeki’s dodgy relationship with Moyane had been published in the media at that point for the past 10 years. Willemse only needed to Google if he was unsure.

The Nugent Commission did not have the benefit of all Gartner’s internal communication, but the commissioner did not wear blinkers. He wrote: “We were not at all impressed by the evidence of Mr Willemse, who prevaricated and avoided direct answers to questions. We are also sceptical of his evidence that he had no knowledge of Mr Monyeki’s relationship with SARS, but if that is indeed true, he should have ensured that he did know. We also think it most improbable that the apportionment to Rangewave of some of the work was coincidental and had nothing to do with Mr Monyeki’s relationship with SARS. We think it is probable that Mr Willemse was well aware that the ordinary competitive procurement process was being unlawfully bypassed.”

Moyane’s role in the crime is more opaque, with few clues in the SEC order. The Nugent Commission was acidic in its evaluation. Judge Nugent pointed out that Moyane, three months after being parachuted into SARS, stopped the institution’s multibillion-rand IT renewal programme without consulting the then information officer, Barry Hore, and announced that he would appoint an “independent” firm to do an evaluation to inform Moyane. The judge particularly pointed out that this made no business sense.

One clear problem the SEC order highlights, however, is that it was Moyane, in a meeting with Gartner executives, who suggested a follow-up project to implement Gartner’s recommendations. For the second time, competitive procurement practices were circumvented. And so phase two of the IT project was embarked upon. Gartner, in turn, testified before Nugent that the firm “completely failed” at SARS, that “nothing any longer exists of what we’d done and nothing has been implemented”, and said “in a very clear manner” no value for money was delivered.

With the bigger picture well established, it is then tempting to consider that Moyane’s “review” of SARS’s already excellent IT system and renewal programme – in fact, the system at the heart of SARS’s success – was perhaps rather aimed at decimating as opposed to understanding. In the same vein, pushing Monyeki on to Gartner may then have been a ruse to make money out of the injury caused.

Which leads us to the SEC’s revealing summary: “[Gartner] knew or consciously disregarded the high probability that [Monyeki] would offer, provide or promise the payments his company received, or a portion thereof, to SARS officials for the purpose of influencing such officials to obtain or retain business for Gartner.”

Neither Moyane nor Makwakwa has been questioned or prosecuted for the crimes they allegedly committed at SARS. Willemse and Monyeki have much to explain – under oath, in an open court. And South Africans deserve to know whether Moyane, Makwakwa and Willemse were on the take for shooing Monyeki in through the back door.

Daily Maverick’s investigative series, named the Makwakwa Dossier, proved that the former COO was stuffing ATMs in the vicinity of his home in Gauteng with cash he could not explain. Importantly, it also showed that Moyane had gone to impossible lengths to shield his triggerman.

The source of Makwakwa’s riches remains unexplained. No one has so far been able to prove that Moyane received any dodgy additional income.

The Hawks and NPA still sit on their hands, despite an avalanche of evidence emerging even eight years after the crime. DM

This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R29.