EOH sets the record straight on debt settlement recognition
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Information technology group EOH said it wanted to clarify the events that led it to sign an IOU.
The company said it had been open and transparent with information from the forensic investigation.
“Since the start of ENSafrica’s forensic investigation in February 2019, the EOH has transparently and proactively reported to the authorities, including the Directorate of Priority Criminal Investigations (DPCI), the FIC (Financial Intelligence Center ), the SIU (Special Investigation Unit), and the National Treasury, regarding the wrongdoing of a handful of former employees of the EOH public sector team. As of July 8, 2019, the DPCI had received an article 34 report on the preliminary findings of ENSafrica and the matter had been reported to the FIC, ”the company said in a statement.
The company said that before entering into settlement negotiations with the SIU, it had met with the National Treasury to report wrongdoing.
“On May 31, 2019, EOH reported the wrongdoing to the National Treasury and offered to compensate the state for the irregularities identified, including the DoD (Department of Defense) and Department of Water and Sanitation contracts,” said declared the company.
“When the SIU first met with EOH leadership on March 20, 2020, the SIU requested that EOH engage directly with them about DoD compensation, as they were mandated to remedy irregularities at the DoD. During this meeting, EOH provided the SIU with ENSafrica’s investigation information on DoD contracts, ”he said.
The company said it started making IOU payments from December 5, 2020.
“The terms of the settlement agreement were disclosed during EOH’s 2020 year-end results presentation on December 2, 2020 and in its SENS announcement,” EOH said.
The company made headlines after news broke that the United States Securities and Exchange Commission was investigating a “shady” licensing deal involving Microsoft and EOH at the South African Department of Defense.
EOH overcharged the Department of Defense on Microsoft licenses, and the company agreed to pay Rand 41.7 million.
Microsoft canceled its long-standing partnership agreements with EOH in early 2019 after an anonymous whistleblower filed a complaint about irregularities in the agreement.
Last week, EOH said it managed to cut its half-year loss by 83% while continuing to clean up an image tarnished by problematic legacy contracts that almost brought the company to its knees.
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