/ 12 September 2023

SIU accuses De Ruyter of maladministration

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Former Eskom chief executive Andre de Ruyter. (Brenton Geach/Gallo Images)

Former Eskom chief executive Andre de Ruyter had made himself guilty of maladministration by initiating a privately funded forensic investigation into corruption at the company and might face legal action, Special Investigating Unit head Andy Mothibi said on Tuesday.

In a briefing to parliament’s watchdog standing committee on public accounts (Scopa), Mothibi said it was plain that the Eskom board had not authorised the inquiry and was not privy to the findings delivered by George Fivaz Forensic and Risk.

“It is a very important governance issue and really points to a measure of maladministration, and that to our view, as far as investigations were done by this private company into the affairs of Eskom, it was unauthorised,” Mothibi told Scopa.

“Consideration should be given to hold the former GCEO [group chief executive officer] to account. This is an interesting question that we have, and it becomes a legal question, as he is no longer employed by Eskom and, in this regard, we have said that we will consider the options that are available, together with the board, and advise accordingly.”

He noted that De Ruyter was reportedly lecturing at Yale University in the US but said this would not stop charges being brought against him, if the SIU were advised that it was indicated.

“We will have to formally reach out to wherever he is, so that action can be taken.”

Mothibi said steps could also be taken against the forensic firm run by former national police commissioner George Fivaz.

“They should know, or alternatively reasonably ought to have known, that they could not conduct an investigation in a state institution without the necessary authority. We will consider the nature of the action to be recommended,” he said.

Mothibi said the SIU had scrutinised the agreement with the firm, which was hired in January 2022 to conduct the investigation, and confirmed that Eskom was not party to the contract. It was a direct agreement with Business Leadership South Africa (BLSA) for work to be done over a six-month period at a cost of roughly R17.1 million.

“We have confirmed that there are no other parties to this contract, including that Eskom is not a party to the contract, which is really an anomaly for us, that it is a contract that investigated, among others, the affairs of Eskom but Eskom is not a party to this contract,” he said.

“The extent to which it investigated and got information related to Eskom, to us, that is problematic.”

The scope of the investigation was to assess all threats to the stability of power supply to South African households, commerce and industry, he said.

Fivaz had confirmed that the fees were paid by the BLSA and private individuals but declined to name these, Mothibi said.

“Mr Fivaz did not disclose the private funders and claimed confidentiality.”

The SIU also interviewed BLSA executive director Busi Mavuso.

Mothibi said not only did the Eskom board not approve the investigation, it was also not briefed on the findings, adding that acting chief executive Calib Cassim recently asked the unit for a copy of the report produced by Fivaz’s investigators.

“We will still revert to him in that regard,” he said.

It has been a point of bitter dispute in recent months as to whether De Ruyter had cover for calling in private investigators and whether he had made sure that law enforcement agencies, the Eskom board and the shareholders were briefed on their findings. Much of this war of words has played out in Scopa meetings.

De Ruyter was interviewed by the committee in April, months after he left Eskom before the end of his notice period after inferring in a television interview that senior ANC politicians were involved in corruption at the company and that cabinet members knew as much.

Former Eskom acting chairman Malegapuru Makgoba told the committee members that Public Enterprises Minister Pravin Gordhan had encouraged De Ruyter to mount an intelligence-gathering exercise.

But Gordhan vehemently denied this, telling MPs that Makgoba was “misleading and misinforming Scopa and the public”. He said De Ruyter had mentioned the intelligence gathering operation “merely in passing”.  

“He was operating on his own free will on this project and it seems, at the same time, he was writing a book as well, other than focusing on his job of keeping the power stations providing electricity to South Africans.”

In sharp contrast to Makgoba, the current chairperson of the board Mpho Makwana accused De Ruyter of misleading the public, bringing the company into disrepute and breaching a raft of laws.  

On Tuesday, Mothibi stressed that “the accounting authority, being the Eskom board, did not authorise the investigation”. 

He said there was some “useful” information in the report the investigators had delivered but maintained that the SIU was not aware of its existence, or even of the investigation, until the day before De Ruyter appeared before Scopa in April, and suggested the same applied to the police and to the Directorate for Priority Crime Investigation (the Hawks).

“We are of the view that the GCEO was under obligation to report those allegations and he failed to do so.”

In an interview with the Mail & Guardian in May, De Ruyter denied this.

He said he had given the police far more information, over the course of many months, than he had divulged in the television interview that triggered his early departure from Eskom.

The ANC has initiated defamation proceedings against him for agreeing with the premise, put to him in that interview, that the parastatal had become a feeding trough for the ruling party.

However, lawyers for the party said on Tuesday that attempts to serve summons on De Ruyter had been complicated by the fact that he had moved to the US from Germany, where papers had been delivered to the local sheriff.

Eskom is yet to appoint a new chief executive.