Legal folly as former Eskom interim CEO fraud and corruption case postponed again

  • Former Eskom interim CEO, Matshela Koko, is accused along with family members and others of fraud, corruption and money laundering relating to Eskom contracts involving R2.2 billion. 
  • In March 2023, Magistrate Stanley Jacobs at the Middleburg Magistrates Court, ordered that the case would not be postponed again for further investigation, meaning the prosecution would have to be ready to take the case to trial yesterday, 4 September 2023. 
  • But the country’s National Prosecuting Authority (NPA) represented by Tiny Seboko, has requested a further postponement citing outstanding witness statements from three interested parties in the USA and Germany respectively.
  • After a further request for a delay made by Sebeko at the hearing of arguments set down on 21 September 2023, Jacobs decided to investigate the delay in the completion of the case to decide on whether the delay is unreasonable, before striking the case off the role.
  • Against this background Jacobs decided to interrogate the investigating officer directly in a hearing set down for yesterday.
  • After an initial complaint by the defence councils, who were seemingly blindsided by the move, the case was allowed to proceed only to be halted because the court could not provide an interpreter for the investigating officer who is Afrikaans speaking.
  • Jacobs then postponed the case to 5th October 2023.

Background

In July 2022, two former local employees of ABB, Mohammed Mooidheen and Vernon Pillay, as well as their spouses, were arrested for corruption linked to Eskom contracts involving R2.2 billion. Read more

On 27th October 2022, the South African Investigating Directorate then arrested eight accused in a corruption, fraud and money laundering case linked to Eskom contracts involving R2.2 billion. The accused in the matter are former SA Local Government Association (SALGA) Chief Executive Thabo Mokwena, Eskom’s former interim Chief Executive Matshela Koko, his wife, Mosima Koko, and Koko’s stepdaughters Koketso Aren and Thato Choma. Eskom Project Director at Kusile (most senior on site) Hlupheka Sithole, Lawyer Johannes Coetzee and Watson Seswai. Read more

Three additional foreign nationals are also accused in the case which includes German national, Markus Bruegmann, ex ABB Group Vice President for Global Product Group Manager “Microgrids & Distributed Generation”,  Sunil Vip, a German national and former ABB employee whose whereabouts are unknown, was involved in ensuring the appointment of Leago and Impulse by ABB and, Gopal Shamji Kambi (UK national), a contractor whose whereabouts are unknown, will face one charge of fraud if extradited. He was a contractor at Kusile who supported Sithole in motivating for the first emergency procurement of Impulse.

More recently, South Africa’s National Prosecuting Authority’s (NPA) Asset Forfeiture Unit served a provisional restraint order of R583.8 million against two former South African employees of international engineering group ABB, Mohammed Mooidheen and Vernon Pillay, their wives, and two Eskom subcontractors, Impulse International and Indiwize Construction.

The NPA alleges that Mooidheen and Pillay entered into a scheme with former acting Eskom chief executive officer Matshela Koko, whereby his stepdaughter, Thato Choma, was appointed a shareholder of Impulse International (Impulse). Documents in the Eskom Files – a vast data dump of emails, forensic reports, bank statements and legal and financial records – show that ABB paid Impulse R557 million. After Choma became a shareholder at Impulse, Eskom awarded the company a series of other lucrative contracts and paid the firm R295 million.

In return Mooidheen and Pillay plus their respective wives, received gratifications in the form of cash and luxury cars from Impulse, which was laundered through Indiwize. 

Mooidheen and Pillay plus their wives were arrested in July 2022. According to the charge sheet, between 28 October and 14 November 2016, the Pillays bought a Toyota Land Cruiser valued at more than R1.3-million while between 28 November 2016 and 4 January 2017, the Mooidheens bought a Golf 7 valued at R618,000 and a Mercedes-Benz valued at R930,000 with money provided by Impulse and/or its subsidiaries. Some assets belonging to the suspects and their spouses were seized by the Asset Forfeiture Unit at the time.

Related news: R33 billion needed to complete commissioning and remedial work at Medupi and Kusile coal fired power stations

The latest move by the NPA follows a series of payments made by ABB in confession and acknowledgements of their unethical and corrupt behaviour in South Africa. ABB have openly admitted to the bribery of a high-ranking official at South Africa’s state-owned energy company, Eskom. The official is believe to be ex Eskom interim CEO, Matshela Koko.

Related news: Ex interim CEO of Eskom, Matshela Koko, is facing up to 15 years in jail

The US Department of Justice’s resolution was coordinated with prosecutorial authorities in South Africa and Switzerland, as well as the U.S. Securities and Exchange Commission (SEC).

“This is the department’s first coordinated resolution with authorities in South Africa, where much of ABB’s criminal scheme was carried out, reflecting our commitment to relationship-building and our ever-deepening partnerships in the global fight against corruption,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division.

“ABB bribed a high-ranking official at South Africa’s state-owned energy company in order to corruptly obtain confidential information and win lucrative contracts. In addition, our partners in South Africa have brought corruption charges against that official.  This resolution demonstrates the Criminal Division’s thoughtful approach to appropriately balancing ABB’s extensive remediation, timely and full cooperation, and demonstrated intent to bring the misconduct to the department’s attention promptly upon discovering it, while also accounting for ABB’s historical misconduct,” added Polite.

Link to ABB’s full plea agreement HERE

In the local case SCCC 36/2022, an affidavit submitted by an ex ABB employee, Goetz Wolff , reveals the true scale of the graft. ‘South Africa ABB (ZAABB) success in winning the C&I tender was to the best of my knowledge brought about by a scheme involving primarily certain of my fellow employees from ZAABB, including myself, employees from other entities in the ABB group of companies, a company called Leago Strategic Services and its CEO Mr Thabo Mokwena and Matshela Koko of Eskom,’ states Wolff. Wolff was business unit manager for power generation at ABB at the time.

In an affidavit submitted by Hawks investigator Captain Wilhelm Schreiber, Impulse’s commercial manager, Yogesh Singh, alleges he was often asked to make payments from the company account into his personal account and then pay third parties. One such payment was a R202,000 payment allegedly made to the African National Congress in July 2016.

“Singh states that on 29 July 2016, R202,000 was transferred into his account and he was asked to transfer those funds to an ANC election account. As Singh did not feel comfortable adding this as a beneficiary on his bank portfolio, he visited the bank and asked them to process the transaction. We submit that the amount of R202,000 constitutes an effected gift received from Impulse,” states  Schreiber.

The amount forms part of R24-million in ‘gifts’ given to various individuals and entities and paid for with the proceeds of the Eskom contract.

Author: Bryan Groenendaal

Leave A Reply

About Author

Green Building Africa promotes the need for net carbon zero buildings and cities in Africa. We are fiercely independent and encourage outlying thinkers to contribute to the #netcarbonzero movement. Climate change is upon us and now is the time to react in a more diverse and broader approach to sustainability in the built environment. We challenge architects, property developers, urban planners, renewable energy professionals and green building specialists. We also challenge the funding houses and regulators and the role they play in facilitating investment into green projects. Lastly, we explore and investigate new technology and real-time data to speed up the journey in realising a net carbon zero environment for our children.

Copyright Green Building Africa 2024.