Former employees of Swedish-based digital tech firm ABB Group have been arrested in connection with alleged R2.2 billion fraudulent contracts at power utility Eskom.
In a statement today, Eskom says it welcomes the arrests of two former employees of former contractor ABB Group, as well as their spouses, for corruption linked to the power utility’s contracts involving R2.2 billion.
According to Eskom, the four were arrested yesterday by the Investigating Directorate of the National Prosecuting Authority (NPA), in a joint operation with the Hawks and the South African Revenue Service, for corruption that defrauded Eskom in a contract awarded to ABB during 2015.
As a result of the influence of the suspects, ABB in turn irregularly appointed Impulse International as a sub-contractor on a R549.6 million portion of the work.
In December 2020, ABB paid power utility Eskom R1.56 billion as a result of corrupt activities flagged at Kusile Power Station.
At the time, the power utility said after lengthy investigation and negotiations, Eskom and the Special Investigating Unit had reached an agreement with ABB South Africa to pay Eskom R1.56 billion in full and final settlement of an overpayment dispute relating to a contract unlawfully awarded through corrupt means for work at Kusile.
The settlement was inclusive of the capital amount and interest, said Eskom, adding the agreement was subject to the review of the High Court.
On its website, ABB says it “is one of the world’s leading power and automation engineering companies with a diverse portfolio of products and services including energy-efficient transmission and distribution of electricity which helps to increase productivity of the industrial, commercial and utility sectors”.
Its portfolio of products and services range from robots that can print cars, light switches, large electrical transformers to control systems that manage entire power networks and factories.
“Eskom congratulates the NPA’s Investigating Directorate on the arrests in this case, and pledges to do everything in its power to assist the investigations to bring about successful prosecutions,” says the utility.
“Eskom also hopes this is just the beginning and that more arrests will follow on this matter, and on the more than 100 other criminal cases lodged with the law enforcement agencies over the years.”
The parastatal says former ABB employees Mohammed Mooidheen and Vernon Pillay stand accused of using their influence and cashing in on irregular gratifications estimated at R8.6 million, which included cash and luxury vehicles, in irregularly awarding to Impulse a R549.6 million sub-contract.
Their spouses are also alleged to have benefited from the crime, it says, adding this concerned work at the Kusile Power Station.
Eskom notes some assets belonging to the suspects and their spouses were seized by the Asset Forfeiture Unit.
According to the Investigations Directorate, the suspects have been released on bail and will again appear in court on 14 October.
“Eskom was one of the main crime scenes, as evidenced by the findings of the Commission of Enquiry on State Capture, and this case was one of the seminal matters on which the State Capture Report recommended prosecutions,” says the company.
“The law enforcement system needs to show that the time for the criminal impunity and theft that continue to rob the people of South Africa of services they have so dearly paid for is up.”
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