Jacob Rees-Mogg, a Cabinet Office minister, told Bain that the case had made the company’s integrity “questionable” and that he was not convinced it had taken its role in the scandal “seriously enough”. Britain is the first western country to impose such sanctions on Bain for its role in the South African “state capture” scandal, and there is already pressure on the US to follow suit. In a letter seen by the Financial Times, Rees-Mogg told James Hadley, Bain’s UK managing director, that the three-year ban would apply retroactively from January 4, 2022. “I believe that after three years Bain & Co he will have restored his reputation,” he wrote. Rees-Mogg’s intervention came after pressure from Lord Peter Hayne, the veteran anti-apartheid campaigner, who had urged Boris Johnson’s government to punish Bain for his “despicable” behaviour. Initially, Cabinet Office officials advised that no action against the company was necessary, but Rees-Mogg sought further advice, including from an external QC. He told Hadley the firm would be barred from cabinet office contracts under the 2015 legislation on the basis that “Bain & Co is guilty of serious professional misconduct which renders its integrity questionable”. Rees-Mogg, who will advise all government departments to implement the same three-year ban, said he was particularly concerned about the way Bain’s South African division had “collaborated” with former president Jacob Zuma’s regime to undermine the country’s revenue service. The consultancy has awarded up to £63m of UK public sector contracts since 2018, including £40m of Brexit consultancy work for the Cabinet, but the damage to the firm will be mainly reputational. In a February letter to Hain, then-Cabinet Minister Steve Barclay wrote that the company “was not a strategic supplier to the government and does not currently undertake any substantial work for the government”. Hayne said: “I am very pleased. This sets a benchmark for all companies behaving in an illegal, unethical and unprofessional manner that they will not be able to bid on government contracts. “I applaud Jacob Rees-Mogg for doing this and I want the US government to do the same.” Bain said: “We were disappointed and surprised by the minister’s decision. . . We will respond to express our concern about the process and its outcome and to address inaccuracies in his letter. “If necessary, we will then consider other options to review the decision. In the meantime, we will continue to work with the Cabinet to ensure we do what is required to restore our place in the UK government.” Earlier this year, an investigation into South Africa’s biggest post-apartheid corruption scandal found that Bain had helped undermine the country’s revenue service through consultancy work that helped Zuma’s allies. Bain’s work to restructure South Africa’s revenue service was “a clear example of how the private sector conspired” with the collapse of public institutions, the inquiry said. He added that Bain tried to use a relationship with Zuma to obtain further government business. Bain has previously admitted failures in its South African work and repaid fees, but said the investigation’s findings mischaracterized its operations. Zuma has denied any involvement in corruption.

Other international consulting firms have been embroiled in corruption scandals in South Africa. McKinsey agreed in 2020 to repay about R650 million ($39 million) for irregularities in contracts it had entered into with a local partner in state-owned companies. Auditor KPMG apologized in 2017 for “mistakes” in working for businesses linked to the Gupta family, accused of serious corruption through ties to Zuma. British PR firm Bell Pottinger has come under fire over its work for the Guptas, which led to accusations that it had stoked racial tensions in South Africa. Banning a company from bidding on public sector contracts is rare. Security group G4S was temporarily banned in 2013 after overcharging the government for online flagging of criminals, some of whom were dead or still in prison. Consultancy Deloitte was suspended from public affairs for six months in 2016 after a memo was leaked in which its advisers criticized the government’s Brexit strategy.