20 February 2019
African Global Operations, a facilities management company in South Africa, which traded under the name Bosasa, is going into voluntary liquidation because local banks have closed all its accounts.
The group has been implicated in a massive public sector corruption scandal. The corruption is being investigated by the state capture commission. The commission was set up to investigate corruption and fraud in the public sector. During the Zuma administration there was wide-spread corruption in the public sector at all levels. The group which employs 4,500 people has suffered extensive reputational damage due to the ongoing investigations. This has prompted two local banks to suspend the group’s bank accounts. The company was unable to open bank accounts in South Africa and abroad. The company said that the jobs of the current employees are at stake. Besides, the group has in excess of 3,100 suppliers; many of whom are small businesses dependent on the work received from the Group. Bosasa was responsible for the provision of meals to nearly 50‚000 prisoners in seven prisons across the country. Correctional services will now have to find a suitable contractor for the catering of the prisoners.
The company’s chairman Joe Gumede claimed that the company was both factually and commercially solvent but it could not operate without bank accounts. In any case the potential liabilities arising from penalties to be imposed by the state capture commission will likely bankrupt the company.
Bosasa’s former chief operating officer Angelo Agrizzi (in the picture above), who turned into a whistle-blower, told the commission of inquiry into state capture, corruption and fraud in the public sector that every public sector tenders the company was awarded over the 19 years he worked at the firm had involved bribery and fraud.
The company bribed the leaders of the ruling party, public prosecutors, and senior government officials to stave-off official investigations into its business activities. Mr Agrizzi implicated the company’s chief executive Gavin Watson, former president Jacob Zuma and current environmental affairs minister Nomvula Mokonyane in the corruption, as well as dozens of other ANC politicians and public sector officials. Irish Times reported.
South Africa: Bosasa corruption leads to liquidation
20 February 2019