Sam Sole, Craig McKune & Stefaans BrÃ¼mmer
More than a dozen people linked directly or indirectly to the family and its closest allies can exercise extraordinary influence over the two parastatals and related government policy, such as in mineral resources, an amaBhungane investigation shows.
The links are indisputable in some cases, and circumstantial or minor in others, and there is no evidence of the named directors and advisers doing anything untoward. But the power this network could wield adds significant weight to concerns about so-called state capture.
The networkâ€™s access to the stateâ€™s most important economic engines, though a raft of board positions, at the very least calls into question the integrity of the appointment process, for which Public Enterprises Minister Lynne Brown bears major responsibility. It also raises the question: Has she sold her soul to Saxonwold, the site of the Guptasâ€™ compound?
In the most revealing case it can be shown that the Guptasâ€™ long-time associate and business partner, Salim Essa, has, or has had, direct connections with at least five company directors of Eskom alone.
Essaâ€™s association with the Guptas is incontrovertible (see â€œEssa and the Guptasâ€ below).
He is also closely connected to a staggering number of people with direct influence in Transnet, Eskom and the department of mineral resources.
The Guptas and Essa did not respond to detailed questions. Responses by others named in the story are included â€œThe departments respondâ€ below. Eskom
In regard to Eskom, Essa has a direct link to five of the current 13 directors, and the broader network shows connections to nine directors.
Allegations that Essa was willing to trade on his perceived influence are already a matter of public record. AmaBhungane has previously reported that Essa offered to lobby â€“ for a fee â€“ on behalf of the information technology company T-Systems to retain an Eskom contract.
Essa did not comment at the time and T-Systems, in its response, ignored questions about Essa, but the company was said to have rebuffed his offer.
Although former Eskom director and acting chief executive Colin Matjila is no longer on the board, Essaâ€™s past relationship with him bears noting. They shared many directorships and a role in the controversial sale and purchase of Cosatu properties.
Matjilaâ€™s involvement while acting chief executive in the unprocedural approval of a business breakfast contract with the Guptasâ€™ New Age newspaper is also a matter of public record.
Essaâ€™s current Eskom five
- Essa was co-director with Eskom chairperson Ben Ngubane in a company called Gade Oil and Gas from May 2013 until Essa resigned in November 2014. Ngubane has close ties with Zuma and was appointed after the previous chairperson, Zola Tsotsi, allegedly failed to play ball with the Gupta family. There is no evidence that Ngubane owes any allegiance to the Guptas.
- Essa was also a co-director with Eskom board member Romeo Kumalo in the company Ujiri Mining, until Essaâ€™s resignation in August 2015.
- Essaâ€™s first cousin, Muhammad Noor Hussain, is married to Nazia Carrim, who is on the Eskom board.
- Essa is friends (including on Facebook) with Mark Pamensky. Essa was a director of one of Pamenskyâ€™s companies, Yellow Star Trading 1099, which is believed to have done business with Vodacom. Pamensky is a director of Eskom and the Guptasâ€™ Oakbay Resources and Energy. Pamensky was also, until November 2015, closely associated with Blue Label Telecoms.
- Essa is also friends with Kuben Moodley, currently a low-profile special adviser to Minister of Mineral Resources Mosebenzi Zwane. Moodleyâ€™s wife, Viroshini Naidoo, is also on the board of Eskom.
Zwane and the Guptas
Zwane is the Free State politician plucked from obscurity to become the mining minister after Zuma unexpectedly redeployed Ngoako Ramatlhodi in September last year.
In December, he famously joined the Guptas in Switzerland to negotiate with Glencore, then owners of Optimum Coal.
He was also central to the controversial Estina dairy project outside his hometown of Vrede, a project driven by associates of the Guptas.
And, in March 2013, a letter sent on behalf of Zwane, then the MEC for agriculture in the Free State, provided the cover of an â€œofficialâ€ government visit that helped secure landing access at the Waterkloof air force base for a plane of Gupta wedding guests.
Zwane is of special interest because his two special advisers, Moodley and Malcolm Mabaso, appear to be important conduits of connection to the boards of Transnet and Eskom.
Zwane and the other Free State connection
In December last year, Brown quietly appointed the relatively unknown Mogokare Richard Seleke as the director general of public enterprises.
Before that, in December 2014, Brown had appointed him to the Transnet board.
He was also serving as the head of the Free State department of economic development, tourism and environmental affairs, to which he had been appointed in 2013 by Zwane, when Zwane was Free State MEC for the department.
Telkom-Blue Label nexus
Moodley is one of a group of people previously linked to Telkom and Blue Label, a company that specialises in prepaid services.
Members of this group have now emerged in key positions, notably on the boards of Eskom and Transnet.
Eskom, in particular, is a very large market for prepaid electricity.
Moodley is also said to be a friend of Pamensky, the former chief operating officer of Blue Label. Moodley was a director of a Pamensky company until 2005.
During his employment at Telkom, which ended in about 2010, Moodley was one of the managers responsible for the relationship with Blue Label, which supplied prepaid services to Telkom.
Moodley allegedly played a direct part in negotiating a highly controversial contract with a Blue Label subsidiary, Africa Prepaid Services (APS), on behalf of Multilinks, then a Nigerian subsidiary of Telkom.
This allegation emerged in a subsequent multibillion-rand damages claim by Telkom against Blue Label, amid counterclaims by Blue Label.
Following the controversy about the Multilinks contract, Moodley left Telkom and appears to have obtained employment through companies linked with directors of APS.
Telkom announced the settlement of the dispute with Blue Label on December 10 2014, the same day on which the Cabinet approved the appointment of Pamensky to the board of Eskom and the appointment of another ex-APS director, Brett Stagman, to the board of Transnet. There is no suggestion the companies did anything untoward.
Another Telkom executive who dealt closely with Blue Label and Pamensky was Zethembe Khoza, who served as Telkomâ€™s managing executive of consumer sales in 2010. Khoza was also appointed to the Eskom board in December 2014.
Essa and Transnet
Essaâ€™s tracks extend throughout Transnet.
- Essa was until recently a business partner of Iqbal Sharma, who served as a director of Transnet until December 2014. Sharma told amaBhungane: â€œWe parted company about two years ago because Salim said he wanted to work full time with Duduzani Zuma.â€
- Essa business associate Stanley Shane is a current director of Transnet and serves with Essa on the board of Antares Capital.
- Essa is also a former business associate of Malcolm Mabaso, whose mother, Linda Mabaso, is the chairperson of Transnet. Malcolm is now an adviser to Zwane. Malcolm was a director with Essa in a company called Premium Security and Cleaning Services, but resigned in October 2015, presumably to take up the position with Zwane. Linda Mabaso is said to be close to the Guptas and to Zuma.
Mabaso and the Duartes
Malcolm Mabasoâ€™s business and personal life is intertwined with that of the Duarte family.
He was previously the managing director of John Duarteâ€™s company, Vumela Holdings. Duarte was also a director of Premium Security and resigned on the same day as Mabaso.
Duarteâ€™s son was best man at Mabasoâ€™s wedding, which ANC deputy secretary general Jessie Duarte also attended. Jessie divorced John in 2002.
Their daughter Zoe is married to Ian Whitley, the adviser to former four-day finance minister Des van Rooyen.
Vumela seems to be a one-stop security, consulting and lobbying business, boasting of clients that include Eskom, City Power, Transnet, the State Information and Technology Agency, Vodacom and PetroSA.
Jessie Duarte told amaBhungane: â€œI do know Malcolm Mabaso and have met him; he is an acquaintance of my son. I am not a partner nor shareholder at Vumela.â€
Besides the potential influence they could wield through Essa, the Guptas have direct or indirect connections with other directors of Eskom and Transnet.
- Brian Molefe, when he was appointed chief executive of Transnet in 2011, had to deny publicly that the Guptas had played a role in his appointment. But, according to trade union federation Cosatu, which raised concerns even then about the Guptas, the family confirmed they were friends of Molefe but said they had not influenced his Transnet appointment. In 2015, Molefe was transferred to become chief executive of Eskom as part of governmentâ€™s response to the electricity crisis.
- Eskom finance director Anoj Singhâ€™s entanglement with former Sahara executive Ashok Narayan in the Homix-Neotel scandal is well known. Sahara is the Gupta computer company. Neotel paid multimillion-rand commissions to Homix, a shelf company linked to Narayan to secure a contract with Transnet.
Singh, then at Transnet, appeared to block payments to Neotel until Homix was paid. He denied wrongdoing and the Gupta family said Narayan had left them a year before. But a source close to Essa has claimed Narayan is still often based at Essaâ€™s Melrose Arch office when he visits South Africa from Dubai.
- Transnet director Vusi Nkonyane is a director of two companies in which the Guptaâ€™s Oakbay Investments has invested directly, according to Oakbayâ€™s website.
- Kebby Maphatsoe is the chairperson of the Umkhonto weSizwe Military Veteransâ€™ Association and one of the most vocal defenders of the Gupta family. The veteranâ€™s association has shares in Shiva Uranium, a company owned by the Guptas and Duduzani Zuma, as does another former veteranâ€™s association office bearer, Sparks Motseki, in his personal capacity. The veteranâ€™s association treasurer is former four-day finance minister Van Rooyen.
But Maphatsoe is also a director of another veteranâ€™s association-linked company in which Harold Klein is listed as a director. He is the husband of Eskom director Venete Klein.
Essa and the Guptas
A company of which Salim Essaâ€™s wife, Zeenat, is the sole director was shown to hold about 5% of the Gupta family-controlled Shiva Uranium when its holding company listed in 2014.
Another company, Elgasolve, 100% owned by Essa, holds or held about 75% of VR Laser Services, a steel fabrication company in which Gupta family investment vehicles have a 25% shareholding.
VR Laser recently courted controversy when Denel announced a Hong Kong-based joint venture between it and VR Laser to market the state-owned companyâ€™s weapons in the East.
Essaâ€™s Elgasolve also owns about 22% of Tegeta Exploration and Resources, the Gupta company that is buying Optimum Coal after a dispute with Eskom forced the previous owners, the giant multinational Glencore, to place the company in business rescue.
Two sources, who know Essa well but asked not to be identified, allege that he acts as a proxy for the Guptas as well as in his own right.
One claimed Essa was one of the â€œGuptasâ€ granted a diplomatic passport by the Lesotho authorities in 2014 â€“ on the advice of President Jacob Zuma. At the time, the person was identified, erroneously or deliberately, as Aziz Omar Essa and described as a Gupta â€œnephewâ€, but the source said this was actually Salim Essa.
The departments respond
These are edited responses from the departments of public enterprises and mineral resources to questions.
Lynn Brown speaking for public enterprises, the Transnet and Eskom directors and herself:
We reject any insinuation that Minister Brown â€œquietlyâ€ appointed Mogokare Richard Seleke as director general of the department.
Soon after her appointment in 2014, Brown reviewed all six boards within the public enterprises portfolio with a view to strengthen the skills required and in certain instances to address issues of gender, tenure and demographics.
These appointments followed a lengthy consultative process with various stakeholders, including the economic sectors and infrastructure development Cabinet committee.
It is not unusual for members of the committee to object to nominations and the list is referred back to the department. Even after this step, the list can still be rejected at Cabinet level.
Minister Brown also expressed her displeasure with the way in which your team went about harassing family members of board members for comment.
Mineral resources, on behalf of the minister Mosebenzi Zwane, Kuben Moodley and Malcolm Mabaso:
Malcolm Mabaso is not Salim Essaâ€™s business partner in any company. The company, Premium Security, in which they were Ânonexecutive directors, never traded, and Mabaso resigned from it a while back.
Any further insinuation of a partnership by Messrs Mabaso and Moodley with Mr Essa or any of the parties or companies mentioned is grossly incorrect.
Any such inference would be devoid of any truth and deliberately misleading.
Messrs Mabaso and Moodley do not have any interest in any mining companies and, as the ministerâ€™s advisers, do not deal with administrative responsibilities.
UPDATE, March 29: Please note the graphic featured in this article has been changed since its publication because there is doubt as to whether the correct person was pictured
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The M&G Centre for Investigative Journalism (amaBhungane) produced this story. All views are ours. See www.amabhungane.co.za for our stories, activities and funding sources.