/ 12 July 2022

Four arrested for corruption in Eskom deal on Kusile power station

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Eskom will have to look for money to buy more diesel because the treasury will not advance it more funding than it already has.

Two former employees of the South African arm of Asea Brown Boveri (ABB), a multi-national engineering firm headquartered in Switzerland, and their wives have been arrested on charges of fraud, corruption and money-laundering stemming from contracts awarded to Impulse International for lucrative work at Eskom’s Kusile and Matla power plants.

Mohammed Mooidheen and his wife Raeesa appeared in the Randburg magistrates’ court while Vernon Pillay and his wife Aradhna appeared in the Durban specialised commercial crimes court.

At the heart of the case, which could later embroil former Eskom chief executive Matshela Koko, is a contract initially worth R25-million and eventually some R526-million following a string of variation orders, awarded to Impulse International by ABB at the behest of the accused. The rates were inflated and the processes followed did not align with ABB’s standard practice.

The contract was allegedly given to Impulse even though it scored poorly in procurement tests and lacked the relevant qualifications.

“Accused 1 and 2 provided Impulse with an unfair advantage over other subcontractors as Impulse’s rates were inflated and ZAABB [ABB South Africa]  procurement policies were not followed in the appointment of Impulse,” the indictment says.

It sets out that Mooidheen and Pillay accepted bribes to ensure the awarding of subcontracts to two companies, Impulse International and Indiwize Construction. Mooidheen allegedly cashed cheques worth R2.8-million from the company while Pillay cashed R3.8-million.

Both allegedly spent the money on cars, with Mooidheen and his wife buying a Golf 7 and a Mercedes. Pillay and his wife allegedly bought a Landcruiser, which they registered in the false name of Shamin Ramdev, which was the name of Mooidheen’s wife until the date of their wedding in 2000.

The Mooidheens registered the Mercedes in the same name. It is from this misrepresentation that the fraud and money-laundering charges flow.

Impulse International was registered in 2012 and Indiwize Construction, a related enterprise, in 2011. Pragasen Pather, who died in June 2021, was the sole director of both. It is alleged that the cars were bought with money provided by him or Indiwe or Impulse. 

But Koko’s stepdaughter, Koketso Choma, reportedly held a sizeable stake in Impulse. Koko allegedly signed off on justification for a sole source deviation that secured Impulse some R66-million in work from Eskom before Choma acquired a 35% stake in the company.

It has been reported that Koko liaised with a staff member of ABB to arrange kickbacks for the contract and promised that contracts at more power plants would be arranged. It is further alleged that he became personally involved in setting contract prices. He has claimed that the investigation was a witch-hunt, saying the power utility was hard-pressed to have a scapegoat for corruption.

It is understood that ABB cooperated with South African authorities to avoid facing charges. The company had secured a R2.2-billion control and implementation project on the construction of Kusile power station.