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McKinsey ignored warnings about Trillian to land huge Eskom deal

McKinsey claims that it carried out a due dilligence review on its partner Trillian in the Eskom deal in January last year and cut ties two months later after determining that the company was unfit.

FILE: Controversial businessman Atul Gupta of the Gupta family. Picture: Kopano Tlape/GCIS

PRETORIA - It has emerged that international business consultancy group McKinsey was warned of the risks associated with Gupta-linked company Trillian four years ago but ignored the warning in order to secure a massive contract with Eskom.

News agency Reuters has interviewed two employees who have contradicted the company’s claim that they were only made aware of the Gupta links last year.

The South African arm of the company did work for Eskom together with Gupta-linked company Trillian, which acted as the multi-national’s local BEE partner.

Trillian has been identified as having received over R250 million from Eskom for work it never did.

McKinsey claims that it carried out a due dilligence review on its partner Trillian in the Eskom deal in January last year and cut ties two months later after determining that the company was unfit.

But the two former employees have told Reuters that they attended meetings in Johannesburg where problems were identified as early as 2013.

They say that McKinsey accepted the Eskom account despite the warnings.

The Eskom contract accounted for more than half of McKinsey's South Africa revenue.

The Gupta leaks show that McKinsey instructed Eskom to pay Gupta-owned companies, describing them as McKinsey sub-contractors, for work that was not performed.

Corruption Watch announced on Tuesday that it would pursue criminal charges against the company in the United States.