Ibex Group, formerly Steinhoff, has decided not to appeal against a decision by the Supreme Court of Appeal (SCA) that it must hand over the sensitive report by PwC on the fraud that brought the company to its knees and cost pension funds billions of rand.
The company said on Tuesday that it would end its six-year fight to prevent the full 7,000-page report becoming public after media house Arena Holdings (then Tiso Blackstar) and amaBhungane Centre for Investigative Journalism dragged the company to court, demanding the release of the report.
“As a result of the SCA ruling, the PwC report will be provided to the media parties on Wednesday, 18 December 2024. The disclosure is mandatory, and Ibex is required by law to comply with the SCA ruling,” the company said in a statement.
“The PwC Report contains the personal information of individuals and corporate entities (“affected data subjects”), mainly individuals who worked for the Steinhoff Group and corporates that did business with the group. The personal information disclosed includes names, contact details, correspondence, and interviews.
“In line with the requirements under the Protection of Personal Information Act, Ibex wishes to notify affected data subjects that their personal information will be disclosed to the media parties and the terms thereof.”
Earlier this month, the SCA confirmed the high court order that Ibex had no legal basis not to release the full report, which the company has kept under wraps since 2019, having made only a summary of the report public.
The release of the report is likely to reveal the true extent of the fraud allegedly masterminded by former CEO Markus Jooste, who took his life earlier this year as law enforcement closed in on him.
The company has to date provided the public and investor community with only an 11-page “overview” of the PwC report.
One of the arguments advanced by Ibex before the SCA was that the report’s annexes contained personal information or data of the people involved in, or who had knowledge of, the accounting irregularities.
Another leg of Steinhoff’s argument was that of litigation privilege, which attaches to communications between a litigant or its legal adviser and third parties if those communications were made for the legal adviser’s information for the purpose of pending or contemplated litigation.
The SCA found Steinhoff had waived the privilege that it now wanted the court to assert by publishing the overview, arguing that merely stating in the overview that the report was confidential did not invoke privilege.
“Given the nature, extent and purpose of the voluntary disclosure in the overview, Steinhoff’s submission that the overview is not a summary of the report, is untenable. The effect of the disclosure was, and was intended to be, a short, clear description of the accounting irregularities and the irregular transactions in which the wrongdoers had engaged, and their impact on the Steinhoff Group, as contained in the report,” said the court in its unanimous judgment.
“In my judgment, on the totality of the evidence, the inference must in fairness be drawn that Steinhoff impliedly waived privilege in relation to the report.”
“It would not only be unfair to allow Steinhoff to use part of the report while claiming privilege over the remainder of it; but also inconsistent with the confidence preserved by any privilege, since Steinhoff has voluntarily disclosed the gist or substance of PwC’s findings — the irregular transactions and their impact — the very reasons for the forensic investigation and the existence of the report.”
The SCA also found that the release of the report was in the public interest, overriding all other considerations.
The imminent release of the report comes as SA’s authorities ramp up the pressure on the characters behind the scandal.
Erstwhile Steinhoff executive Stephanus Grobler is facing criminal charges over the fraud that sank the company in what was the largest corporate fraud case in SA history.
The Reserve Bank seized more than R66m belonging to Grobler in October.
Grobler, who also uses the name Stéhan, was arrested a day after Jooste committed suicide in Hermanus nine months ago.
Steinhoff is demanding Grobler pay back nearly R300m he was paid in salaries, bonuses and other incentives.
Former Steinhoff CFO Ben la Grange was in October sentenced to 10 years in prison, five of which were suspended, after pleading guilty to one charge of fraud in the Steinhoff saga. He promised to testify against Grobler, who is set to appear again in court next year.
Jooste’s suicide came a day after Financial Sector Conduct Authority fined him R475m for misleading the market about furniture retailer Steinhoff in 2014-17, monies that it said it would pursue from his estate.
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