Court orders Steinhoff to share forensic probe into accounting fraud with media

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Former Steinhoff CEO Markus Jooste.
Former Steinhoff CEO Markus Jooste.
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Two media houses have been granted access to a 3 000-page forensic probe into accounting fraud at Steinhoff that the retailer argued should be kept privileged.

Investigative journalism outfit amaBhungane and media house Tiso Blackstar*, which is now known as Arena Holdings, approached the Western Cape High Court seeking an order compelling Steinhoff to share the probe with them. The retailer has to date refused to share the report, compiled by auditing firm PwC over 18 months, with the media.

Findings have been shared with law enforcement agencies, however.

Steinhoff argued that giving the media access to the report would undermine future court cases against implicated former executives, such as its disgraced former CEO Markus Jooste. 

In a series of tweets on Tuesday evening, amaBhungane said the court had dismissed Steinhoff's objections. The judge set aside Steinhoff's previous refusal to provide the report and ordered it be shared with the two media houses within 10 days. 

In a short statemenet, Steinhoff said it had received the judgement. "We are reviewing it and will be taking legal advice."

The two media groups, meanwhile, already appear to be gearing up for a appeal bid. 

AmaBhungane's co-managing partner, Sam Sole, tweeted in reaction to the ruling: "They'll appeal, but round one to us!"

What is the PwC report?

Steinhoff engaged PwC in December 2017 to conduct an independent forensic investigation into what was at the time described as "accounting irregularities". This came shortly after Jooste resigned as CEO, plunging the group's share price to an all-time low and causing an acute liquidity crunch.The report, which covers 3 000 pages with some 4 000 documents as annexes, was handed over to Steinhoff management in early 2019.

An 11-page overview was shared with the media in mid-March that year. The overview stated that a "small group" of former Steinhoff executives had inflated the group's profit and asset values by roughly R100 billion over eight years. 

* Tiso Blackstar sold its media assets to Lebashe Investment Group in 2019, after which it was rebranded as Arena Holdings. Court documents and oral arguments still refer to Tiso Blackstar, however. The group requested the report in March 2019, before it was renamed.

* This article has been updated to include Steinhoff's response. 

 

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