FDA's Keating responds to allegations of corrupt relationship with police

2017-12-22 17:46
Keith Keating. (File, Jan Gerber, News24)

Keith Keating. (File, Jan Gerber, News24)

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Cape Town – The businessman whose contracts with the police have been described as of a "corrupt nature" says the allegations against him are part of an attempted hostile takeover of his business.

It was recently revealed that Keith Keating's company Forensic Data Analysts (FDA) had allegedly received R5bn in SAPS contracts since 2010. 

In a letter sent to then acting police commissioner Lieutenant General Lesetja Mothiba, Independent Police Investigative Directorate (IPID) said that Keating had paid for vehicles for former acting police commissioner Khomotso Phahlane, his wife and sister.

Furthermore, at a dramatic meeting of the Standing Committee on Public Accounts (Scopa) on November 29, it emerged that the State Information Technology Agency (SITA) awarded a contract for police forensic equipment, mostly lights and Nikon cameras, worth more than R900m to Keating's company FDA, and a contract to another Keating-linked company for the maintenance of this equipment, without following procurement processes and without there being a reason for FDA being the sole provider.

Much to MPs' disgust, Keating sat behind them, directly in the line of sight of the police officers and SITA officials as MPs grilled them on the contract. 

The inquiry was led by DA MP Tim Brauteseth, who produced pictures of Keating with two police officers from the police's supply chain management department in personalised Manchester United jerseys in the football club's trophy room and outside their storied ground Old Trafford. The pictures were taken in October 2011.

Demand for shares, threats

Scopa said SITA must cancel the contracts with FDA.

News24 reported on December 6 that in a joint operation by the Hawks and IPID seven properties connected to Keating and Phahlane were raided.

In a long statement, Keating responds to the allegations against him.

"There are many indications that the aspersions cast over FDA in the past months are aimed at having FDA's contracts with the South African Police Service (SAPS) and State Information Technology Agency (SITA) terminated arbitrarily," reads Keating's statement. 

"In recent months, FDA has been exposed to hostile corporate takeover tactics which began with a demand to hand over shares in the company without compensation, with stern threats of dire consequences should these demands not be met. Proof of these threats have been reported to SITA, but no action has been taken to date."

He said this is reminiscent of the methods employed to force Optimum Coal into business rescue, allowing it to be bought for a pittance by Tegeta which took over Optimum's government coal supply contracts. 

Furthermore, Keating says there is "reason to believe that an ongoing rift between two high-ranking government officials may also be at play in this matter". Although unnamed, the two officials appear to be Phahlane and IPID chief Robert McBride.

Keating responds as follows to the allegations against him:

The R5bn SAPS contract:

Keating said: "Our records indicate that even if our contracts with SITA are categorised as SAPS contracts, the alleged amount will still have been overstated by almost 300%. The total contract value, for contracts entered into directly between SAPS and FDA, is R457m, which is also billions of rands less than the amounts being reported on."

Contracts for supply and maintenance of forensic equipment:

"FDA's dealings with SITA have always been above board. If, for whatever reason, SITA has ever not complied with any procurement regulation, this can in no way be attributed to FDA," reads Keating's statement.

"The bulk of equipment serviced and maintained by FDA was sourced to SAPS pursuant to an open bidding process, awarded to a supplier other than and unrelated to FDA and in terms of a bid published by SITA.

"The forensic light sources, together with the support and maintenance service contract, were provided at acceptable market-related prices in terms of approved procurement practices. 

"The failure by SITA to initiate procurement processes before the expiry of contracts contributed significantly towards the frequent extensions of existing contracts."

Manchester trip: 

The SAPS officials that appear with him in the published photographs were in Cambridge for an officially sanctioned conference regarding radio frequency identification technology, Keating said.

Keating flew to Manchester to watch the football match, whereafter he attended a presentation in Graz regarding the shortcomings of current RFID technology in use in South Africa. After attending the presentation in Graz he returned to South Africa.

"Neither FDA nor Keating had paid for football tickets or shirts for these officials that appear in the photographs; the officials had paid their own expenses," reads the statement.

Attendance at Scopa meeting:  

"Keating, as a member of the public, was completely within his constitutional rights to attend an open meeting of a parliamentary committee," reads the statement.

"I attended the hearing, as FDA and I were under discussion at these hearings. The position has always been that we are available to engage on and provide our side of the story. No formal accusations have been put to myself or FDA," Keating said.

In conclusion, Keating insisted that a fair legal process should be followed.

"We are confident that fair legal process will allow FDA and myself to be vindicated in time, whereas anything short thereof would defy our constitutional rights, which we are determined to uphold," he said.

Read more on:    keith keating

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