The Democratic Alliance (DA) has revealed that three Gupta-linked companies– Tegeta Resources and Exploration, Optimum Coal Mining and Trillian Consulting– have been operating using Broad Based Black Economic Empowerment (BBBEE) certificates that are possibly fraudulent.
The three companies submitted their BBBEE certificates to Eskom in order to secure contracts and meet internal procurement criteria during the course of 2016.
The DA gained access to the certificates after sending in an application to Eskom through the Promotion of Access to Information Act (PAIA).
In a statement released on Monday morning, the DA says an analysis of the certificates shows that Tegeta which is considered a micro enterprise does not actually meet the criteria. A requirement for micro enterprises is that a company’s annual turnover not exceed R5-million.
Tegeta’s assets are valued at R11-million and that the company also has contracts with Eskom “with a combined business value of R2.2-billion.”
The changes in Trillian’s BBBEE credentials have been questioned by Eskom with uncertainties over when Trillian had black ownership and which contracts were received while the company was not BBBEE compliant.
In an affidavit, Trillian is rated as a micro enterprise with 0% black ownership.
Gupta-linked businessman Salim Essa’s “60% share constituted the black ownership portion of Trillian” from November 2015 until he sold out his shares in July 2017.
Trillian is also categorised as a micro-enterprise but the company was paid R495-million for ‘consulting services’ and R30.7-million for developing a corporate plan for Eskom, three days after receiving its BBBEE certificate. This revenue disqualifies Trillian from being a micro enterprise.
The statement proceeds to reveal how the black ownership figures on the BEE certificates for Tegeta and Optimum Coal Mines were “most likely incorrect”.
The certificates list black female ownership of 5,13% for Tegeta despite having no black female ownership.
The company Mabengela Investments which is owned by President Jacob Zuma’s son, Duduzani Zuma, owned 28.5% of Tegeta, while Salim Essa’s Elgasolve owned 21.5%. Gupta-owned Oakbay Investments and Fidelity Enterprises (foreign-registered in UAE), which made up the remaining shareholding of 50%, are both 0% black owned.
Despite all of this, Eskom has maintained, in a November 2016 statement, that Tegeta was above 50% Black owned requirement.
In the statement, the DA says that: “It is clear that these B-BBEE certificates and affidavits from Gupta owned companies may have been an attempt to artificially meet BBBEE requirements.
“The Gupta entities’ actions, combined with Eskom’s and BEE Matric’s willingness to blindly accept these, may constitute criminal behaviour and must be urgently investigated.”
The DA has resolved to report the possible fraudulent behaviour to the BBBEE Commission for investigation and will also ensure that all documents available to them will be sent to the inquiry into state capture that will be headed by Deputy Chief Justice Raymond Zondo.
All the documents and certificates provided by the DA can be found below: