Denel employees under investigation.
  • State arms company Denel has launched a fast-track search for a "lifestyle auditor" to investigate staff and suppliers, more than 7,800 individuals in total.
  • It wants quotations for the job within a week, and expects the process to be underway just days after that.
  • After screening, Denel believes, some 350 of its employees may warrant full lifestyle audits.
  • In 2016 Denel set up a deal involving the Gupta family later described as an attempt to hijack its intellectual property.
  • For more stories go to www.BusinessInsider.co.za.


State-owned weapons company Denel on Wednesday launched an urgent search for a "lifestyle auditor" to examine, at last as part of a screening exercise, thousands of employees and suppliers.

More than 3,300 employees and another 4,500 suppliers are due to be checked, for a total of more than 7,800 individuals.

Over the course of four to six weeks, the company says in a request for quotation published on Wednesday, it wants an auditor to "identify possible fraudulent between" [sic] those two groups, plus an identification of "high risk" employees and suppliers.

It then wants an estimated 350 people, identified in that first phase, to be audited. 

The auditing will involve "a comparison of known income with standard of living, identifying gaps and indicators should someone be living beyond their means", Denel told potential bidders for the job.

That is in aid of "turning around the workplace to expose corruption and reduce fraudulent practices".

In 2016 Denel set up a joint venture featuring a company controlled by the Gupta family as well as Gupta associate Salim Essa. The partnership appeared to grant the Gupta-linked VR Laser Asia the rights to sell Denel's technology to Indian manufacturers in return for 49% of any profits, in what then minister of public enterprise Pravin Gordhan later described as an attempt to hijack Denel's intellectual property.

Leaked emails suggested Denel's chairperson at the time, Daniel Mantsha, on several occasions provided confidential company information to the Gupta family's machinery, while also sending his personal bills.

Denel did not answer questions about the lifestyle audit project, including why it was apparently considered urgent and how it reached the estimate that 350 employees may be found to be high risk.

Instead it responded to Business Insider South Africa with a statement, which reads in full:

"Please note since the appointment of the current Board, Denel has been committed to clean up, rebuild and restore public trust. Lifestyle audits is one of the measures the company is using to manage and reduce the fraud and corruption risk.  

"Denel has initiated a procurement process for a service provider to assist with the lifestyle audit. Part of the audit will entail verifying declared interest by employees and suppliers.   

"Denel is committed to strengthening corporate governance and growing the confidence of our stakeholders."

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