Home South African Eskom to go after Guptas, associates and ex-minister

Eskom to go after Guptas, associates and ex-minister

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Power utility Eskom is claiming R3.8 billion from the Gupta family, its associates and a former cabinet minister.

Johannesburg – Power utility Eskom is claiming R3.8 billion from the Gupta family, its associates and a former cabinet minister.

The Guptas have been accused in a number of corruption scandals across a number of state-owned entities and government departments but are yet to face the music for their alleged crimes.

The local arm of a Swedish-Swiss multinational company has agreed to pay back R1.57bn to Eskom after it received irregular contract extensions from the entity.

Public Enterprises Minister Pravin Gordhan congratulated the Special Investigating Unit (SIU) and Eskom for the recovery.

Gordhan said the next step was to review dodgy contracts, pursue claims issued against Gupta family and associates, former executives, board members and a former minister, who he said would continue to mislead the commission of inquiry into state capture headed by Deputy Chief Justice Raymond Zondo.

Eskom and the SIU announced that it had reached a deal with ABB South Africa after it had agreed to return the money because of collusion with certain officials of the power utility to irregularly award the company a R2.2bn control and instrumentation contract at the Kusile power station in March 2015.

In July, Gordhan announced that ABB, Tubular Construction Projects, the Stefanutti Stocks-Basil Read joint venture and the Stefanutti Stocks-Izazi joint venture were each overpaid by R1bn, while another company, Tenova Mining and Minerals SA, received R735 million.

The SIU has been on the trail of these companies and has not ruled out further recoveries.

SIU head Andy Mothibi said an agreement was signed between the unit, Eskom and ABB on Friday morning for the company to pay back the money.

”Money will be paid as agreed,” Mothibi assured the country, adding that the SIU was considering initiating the blacklisting process for ABB South Africa to bar it from doing business with the government.

Eskom chief executive Andre de Ruyter said some of the power utility’s officials illegally and fraudulently induced it to pay about R800m to ABB South Africa in illegal variation orders.

De Ruyter said Eskom paid ABB R3.1bn and that the overpayment claimed included collusion worth R250m, interest worth R380m and the R160m profit made.

However, De Ruyter maintained that ABB had completed work of which Eskom received value and warned that hiring a new firm would result in a delay of four years and risk load shedding.

He said Eskom would request the national Treasury for ABB South Africa to continue with the work but with the proviso that the company will make no profit from the contract.

Mothibi said the criminal investigation was ongoing and that no arrests had been made in the ABB investigation.

He said the company did not admit its guilt on its own, but only because of investigators’ work and overwhelming evidence.

”ABB did the right thing because they realised the investigation is intense. It’s a significant recovery on our part,” Mothibi said.

He said the SIU had identified other potential areas for more recoveries.

Mothibi refused to identify the individuals involved in the ABB case because they had not been charged.

He said the high court application to review and set aside the ABB contract because it had been awarded corruptly and irregularly would be launched early in the new year.

Political Bureau