Former Eskom execs & board members breached their fiduciary duty - SIU
On Monday, the SIU and Eskom issued summons to the Pretoria High Court to recoup R3.8 billion lost to corruption at the power utility from former board members, executives, members of the Gupta family, and their associates.
JOHANNESBURG - The Special Investigating Unit (SIU) on Monday said former Eskom executives and board members had breached their fiduciary duty of care and good faith to the state-owned enterprise by participating in and corruption and state capture.
“All of the former executives and board members breached their fiduciary duty of care and good faith to Eskom, and acted in a concerted state capture effort with the Gupta brothers, Mosebenzi Zwane and Salim Aziz Essa to illegally divert funds from Eskom,” the SIU and Eskom said in a joint statement.
The unit and Eskom issued summons to the Pretoria High Court to recover funds from former board members, executives, members of the Gupta family, and their associates. They are all accused of enabling looting at Eskom, which cost about R3.8 billion through Optimum Coal Mine and associated Trillian.
Among the defendants were former Eskom group CEO Brian Molefe, former CFO Anoj Singh, the power utility’s former head of generation Matshela Koko as well as the Gupta brothers, Rajesh, Atul, and Ajay.
This comes as calls continued to mount for those behind state capture and the bleeding of state-owned entities to be prosecuted.
The SIU and Eskom detailed how all those implicated - including former Eskom board chairperson Ben Ngubane and company secretary Suzanne Daniels - had acted in a concerted state capture effort with the Gupta brothers, former Mineral Resources Minister Mosebenzi Zwane, and businessman Salim Essa to illegally divert funds from Eskom.
“The funds were lost in a concerted effort corruptly to divert financial resources from Eskom, to improperly and illegally benefit the Gupta family and entities controlled by the said family and their associates during their 2015-16 acquisition of the operations of Optimum Coal Holdings Limited (OCH),” the statement read.
As a result, Eskom incurred at least R3.8 billion in losses, which the utility said it was now legally obliged and morally burdened to recover with interest.
Eskom was reviewing major contracts conducted over the years and it said corruption was discovered. The SOE said it had the duty to cancel those contracts and recoup the money lost.
“Where any evidence of corruption or other irregularities have been discovered, Eskom has a moral and legal duty to cancel those contracts, and to recoup any losses it may have suffered as a result of any illegal or irregular activity,” the statement said.
At the same time, the SIU said while it was working on recovering funds lost in illegal deals at Eskom, they could not affect any arrests of any defendants.
The unit’s spokesperson Kaizer Kganyago said they were confident they had a strong case.
“We don’t arrest people as the SIU. Our mandate is to recover stolen funds and we work with Eskom to try to recover the monies. Where there is criminality we have to refer those matters to the NPA for prosecution and arrests by the Hawks,” Kganyago said.