(Delwyn Verasamy/M&G)
Eskom has given Gupta-linked firm Trillian and international consultancy company McKinsey, a deadline for tomorrow to pay back R1.6-billion that was paid to them by the power utility.
A letter of demand was sent to Trillian and McKinsey on October 4, according to Business Day. The letter was written by Bowman law firm, who represented Eskom, reports Business Day.
“To ensure that the money unlawfully paid to McKinsey and Trillian is safeguarded Eskom would like it to be returned to it as soon as possible, but by no later than October 10 2017,” the letter states.
The power utility has also threatened to go to police and open a case against those who have benefited from the deal on charges of theft, fraud and corruption. Eskom said it would approach the courts to set aside the contract through which Trillian and McKinsey did business with the power utility.
A dodgy deal
After initially denying that it paid any money to Trillian in May 2017, the power utility has unraveled.
Trillian, who was McKinsey’s empowerment partner, was paid at least R500-million in “consultancy fees”, Eskom admitted in July. The money was paid despite Eskom having no contract in place with Trillian, who by this time had already separated from McKinsey.
Eskom, by its own admission, also paid McKinsey more than R1-billion for six months’ work on a contract that the power utility admits was “unlawful… invalid and void”.
Reports from Fin24 also indicate that Eskom dismissed advice from their own legal team, who said that the power utility’s contract with McKinsey was not lawful. The Treasury cancelled the contract, but it was still used to usher in a R1-billion payday for McKinsey.
McKinsey, meanwhile, has said that it was led to believe that Treasury had approved the contract.
“The contract included a requirement that Eskom secure the necessary approvals or consents that may be required in terms of the Public Finance Management Act. We were told that Eskom had secured the necessary approvals,” McKinsey told Fin24.
Trillian has distanced itself from allegations of wrong-doing, telling Fin24 that McKinsey and Eskom negotiated the contract that saw it benefit more than R500-million.
“Trillian was not involved in the commercial negotiations between McKinsey and Eskom… It was McKinsey that negotiated the commercial terms of these two projects with Eskom. In turn Trillian was allocated a portion of the work [30 percent] as McKinsey’s [supplier development] partner for these projects.”
If Eskom should ask the courts to set aside the contract, then its own alleged negligence could be revealed. Aside from ignoring warnings from its lawyers, Eskom has purged executives in recent months that have been accused of dealing with the Gupta family.
Former Eskom chief financial officer Anoj Singh, who was suspended in September, has been revealed in the Gupta leaks emails to have accepted cash from the Gupta family.
Brian Molefe, former Eskom chief executive, was implicated as being friendly with the Guptas in the Public Protector’s State of Capture report, and later raised eyebrows when he received an alleged pension payout/unpaid leave payout/performance bonus of R30-million after he said he would resign from Eskom.
McKinsey and Trillian are set to meet with Eskom on Monday, Business Day has reported, but in the meantime the two firms are still faced with a lawyer’s letter to pay back R1.6-billion by tomorrow.