Department probes Cipro software deal

The Department of Trade and Industry will investigate claims that it paid $2.7-million for software to controversial IT provider VALORit, while the retail price for the software was only $900000, said Trade and Industry Minister Rob Davies.

According to a judgment in the North Gauteng High Court between VALORit and Blue Turtle - the sole agent for the software - VALORit was supposed to charge the government agency Cipro (the Companies and Intellectual Property Registration Office) $1.4-million for the software, with the profit being split between VALORit and Blue Turtle.

However, according to the tender documents, which were not submitted to court, VALORit charged Cipro $2.7-million, Politicsweb reported this week.

Davies said the department was "gravely concerned" about the price paid and the value received.

The software was supposed to be part of Cipro's new electronic content management system after the old one suffered a series of high-profile security breaches.

Last year the department terminated the contract, awarded to VALORit for R153-million - against Faritec's bid of R63-million - after the auditor-general uncovered irregularities.

The parties have not reached an out-of-court settlement, despite claims to the contrary by VALORit, and the high court would now have the final say, Davies said.