June 17, 2021


Beyond law

SIU investigating Denel over irregular agreement with Telspace Units

The Unique Investigation Unit (SIU) is investigating former Denel officials for their position in an irregular deal with information security company Telspace Systems.

Briefing the Standing Committee on General public Accounts (SCOPA) on 3 March, SIU direct investigator Zodwa Xesibe said the agreement with Telspace Techniques and Denel did not abide by any official procurement/competitive bidding system.

The organization was employed to test the vulnerability of IT methods within just Denel to exterior hacking (purple group penetration tests). The SIU discovered the system to appoint Telspace was irregular as there was no tender advert, and no tender procurement system adopted. “It was a gentleman’s settlement,” Xesibe stated. “There was a middleman who acted as a nodal stage in between Denel and Telspace. As a consequence of an engagement letter that was entered into, Denel built a 70% progress payment of R4.6 million.”

Following giving Denel with some of its protection risk conclusions, Telspace demanded the 30% remarkable payment and when Denel demanded all Telspace conclusions without having even further payment, Telspace launched a civil declare versus Denel for R1.9 million. Xesibe mentioned Telspace was inclined to settle and walk absent from the civil claim. “We recommended Denel to settle simply because they really do not have cash to pay authorized expenses to fight the circumstance.”

Xesibe mentioned the SIU has evidence versus the former team CEO on PFMA (General public Finance Administration Act) contravention and is searching at accumulating additional proof. All employees implicated in the investigation have left Denel but the SIU is pursuing felony and civil recoveries.