How many Eskom employees have been charged with fraud and corruption

[Nat Quinn]

Of 144 criminal cases opened with the South African Police Service against Eskom employees for fraud and corruption, only 41 have been through criminal proceedings under the Criminal Procedure Act.

This is according to the chairperson of the Eskom Board, Mpho Makwana, who published audit statistics regarding criminal activity at the power utility.

“Eskom is rooting out fraud and corruption within its ranks and supply chain through proactively implementing recommendations made by the Zondo Commission and beyond,” Makwana wrote.

Citing audit figures from the end of the third quarter of 2022, Makwana revealed that only 41 of 144 cases — 28% — have resulted in criminal charges.

However, he noted that clean-up efforts had resulted in the termination of 183 employees, 42 of which were dismissed due to fraud and corruption.

“During this period, owing to the governance clean-up efforts, 183 employees terminated their employment through resignation, abscondment (157), and retirement (26) during the disciplinary processes,” Makwana said.

“In total, 42 were dismissed due to fraud and corruption.”

Eskom kicked off its clean-up effort by establishing the State Capture Task Team on 14 July 2022.

“We are also working closely with the Special Investigative Unit (SIU) and are providing regular progress updates to the Standing Committee on Public Accounts (SCOPA), with the most recent update jointly presented to Scopa on 24 January 2023,” Makwana wrote.

The power utility is also going after former Eskom executives over fraudulent and corrupt activities highlighted in the Zondo Commission’s State Capture Report.

“Our close collaboration with the law enforcement agencies is instrumental in addressing the Zondo Commission’s recommendations,” Makwana said.

“Key among the recommendations is that the National Prosecuting Authority (NPA) undertake the criminal prosecution of former Eskom board members and executives involved in decision-making that resulted in inter alia the breach of the Public Finance Management Act.”

The report singled out several former Eskom executives for dodgy dealings at the power utility, including the irregular coal supply to Eskom from Tegeta’s Brakfontein Colliery.

The Zondo Commission recommended that the NPA consider criminal proceedings against the implicated executives and other individuals in this case.

Makwana highlighted Eskom’s triumphs through its pursuit of these former executives.

“One of the success stories to date includes the matter relating to the unlawful payment of R1.6 billion to McKinsey, Trillian and Regiments. Eskom has since recovered R1.1 billion from McKinsey and has a judgement against Trillian,” he wrote.

“Trillian has been placed in liquidation after the firm failed to abide by the court judgement and this has resulted in the sequestration of Trillian’s key shareholder and director.”

Mpho Makwana, chairman of Eskom Holdings Ltd. Photography: F. Carter Smith/Bloomberg

With the help of the SIU, the power utility has recouped more than R2 billion in funds unlawfully paid to service providers and is currently recovering approximately R1 billion from SAP.

It is also pursuing the recovery of R3.8 billion through civil action against 12 defendants who played a central role in State Capture.

“Seven of the 12 defendants are former Eskom executives and directors,” Makwana added.

Eskom’s dedicated State Capture Task Team is working to address the findings of the Zondo Report. The steps it has already taken include the following:

• Disciplinary action against delinquent employees;

• Flagging delinquent employees for future employment;

• Disciplinary action against dodgy suppliers;

• The deregistration of delinquent suppliers from Eskom’s supplier database;

• Blacklisting such suppliers through the National Treasury;

• Taking action against delinquent directors;

• Instituting civil recovery processes and criminal proceedings;

• Reporting of delinquent employees to professional bodies; and,

• The review of Eskom-specific policies, procedures, and governance requirements.

Makwana noted that Eskom doesn’t currently employ any individuals implicated in State Capture, as they either resigned or were dismissed in early 2018.

“Despite the arrest of a former Interim Group Chief Executive and 25 others accused of fraud and corruption at Eskom in relation to the Kusile contract on 27 October 2022, criminal proceedings continue to lag,” he added.

“We are therefore closely monitoring all outstanding criminal matters and are working with the SIU, NPA and other law enforcement agencies to bring these to court as soon as possible.”

Eskom is also implementing various initiatives, including an automated procurement system to manage its spending better and protect against security breaches.

“The organisation will continue to monitor technology developments and will introduce suitable tools as they become available,” Makwana said.

 

SOURCE:How many Eskom employees have been charged with fraud and corruption (mybroadband.co.za)

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