S. African MPs urge probe into largest corporate scandal ever experienced by JSE

CAPE TOWN, Dec. 11 (Xinhua) -- South African lawmakers on Monday called for an urgent investigation into the largest corporate scandal that the Johannesburg Stock Exchange (JSE) has ever experienced.

Urgent, firm and decisive action must be taken to deal with the wrong-doers in the scandal, Parliament's Standing Committee on Public Accounts (SCOPA) said in a statement emailed to Xinhua.

The scandal involves Steinhoff, a South African-based international furniture and clothing retailer whose shares collapsed last week following the exposure of accounting irregularities.

The rout, which started on Wednesday, has wiped off over 160 billion rand (about 11.7 billion U.S. dollars) of Steinhoff's market capitalization.

Steinhoff CEO Markus Jooste has announced his resignation over the scandal.

"This crass greediness of senior executives in the private sector is an indicator of the pervasiveness of immoral conduct among South Africa's elite," SCOPA Chairperson Themba Godi said.

Parliament cannot be a spectator in this unfolding drama, as the laws of the country, ethical conduct and workers' pensions go down the drain because of the recklessness and corruption of the super-rich, he said.

Steinhoff is included in the Top 40 share listing on the JSE and is one of the 15 biggest companies on the exchange.

Steinhoff's meltdown has sparked fears of what the impact on pension funds and unit trusts would be of those who had placed their trust in Steinhoff as a solid investment, having invested heavily in what was seen as a star performer.

Also on Monday, the Public Investment Corporation (PIC) and the Federation of Unions of South Africa (FEDUSA) met to find ways of salvaging workers' pensions managed by the PIC.

Godi said he would like to see SCOPA, together with Parliament's Standing Committee on Finance, taking up the matter and seeking accountability from Steinhoff and the PIC.

Godi called on the National Treasury to be more strident in its condemnation of the scandal than it has been thus far.

The South African Revenue Service (SARS), the South African Reserve Bank (SARB), the Independent Regulatory Body for Auditors (IRBA) and the Financial Services Board (FSB) must urgently investigate, Godi said.

The Directorate of Priority Crime Investigation, known as the Hawks, has a duty to charge all those involved, Godi said.

"Corruption, whether perpetrated by the rich or the poor, must be condemned and the perpetrators sent to jail," he added.

All progressive and patriotic South Africans must put a stop to political and corporate corruption that has put the country's reputation in the gutter, Godi stressed.

Following Steinhoff's fallout, international rating agency Moody's last week downgraded Steinhoff by four notches to B1, and placed the global retailer's rating on review for further downgrade.

An investigation by international consulting firm PricewaterhouseCoopers (PcW) is underway to uncover details behind the scandal that has led to an 84 percent share-price plunge in three days. Lenders and other creditors have billions of dollars exposed to the company, which has expanded aggressively around the world. Enditem