LIVE: Anoj Singh must pack his bags for Sun City prison - inquiry hears

Lax attitude by Eskom execs creates room for corruption 

The lax attitude of Eskom executives who approved the McKinsey-Trillian contract created room for corruption, said G9 Consulting CEO Raji Murugan.

Taking questions form the portfolio committee on public enterprises Murugan said that in its investigation the consulting firm took issue with approvals made of the contract without proper due diligence being conducted.

“When entering in a contract with company which will run into billions, at the very best it must be thrash out at a physical meeting, not over the internet.”

Murugan criticised approvals made via email by Eskom officials. The issue was not the approval of the contract but that when things are pushed illegally, email is often used. “There’s no real discussion or engagement or risk identification,” he said.

He also raised concerns that the money paid over to Trillian might never be recovered. 

Khoza wanted to quash G9 report, Singh to go to prison

Former acting Eskom chair Zethembe Khoza wanted to quash the G9 report, the portfolio committee on public enterprises heard at the Eskom inquiry on Tuesday.

G9 Consulting CEO Rajie Murugan said of his experience, Khoza spoke to many people about the repor, saying that it was "not worth the paper it is written on".

Murugan said Khoza also made disgusting statements. "He would make statements like 'you know people could get killed for doing these types of investigations',"  said Murugan.

Murugan said Khiza suggested that G9 were "agents" planted at Eskom.

Khoza must take full responsibility for stopping this investigation, said Murugan.

Of his interactions with interim CEO Sean Maritz, Murugan found him to be a "stooge". It appeared in his interview with Maritz that he was informed by Khoza that the investigation was halted. It was like Khoza had informed Maritz not to disclose more information from the point that G9 was told when to stop the investigation.

Murugan added that there is an element of criminal activity. He named former CFO Anoj Singh, saying that he should pack his bags to go to Sun City prison in Johannesburg. 

Eskom officials found ways to make illegal payments to Trillian

Monies paid to Trillian and McKinsey for consulting services are “shocking”, said G9 Consulting CEO Rajie Murugan.

He was presenting evidence based on G9’s investigation into the relationship between Eskom and Trillian at the Eskom Inquiry on Tuesday.

He spoke on how the contract with McKinsey for the corporate turnaround plan and the MSA contract could not be justified. “We are consultants, these numbers are shocking- they can never be justified in anyone’s lifetime, in any country in this world.”

“The figures are shocking for what they did.” Trillian was paid R49m irregularly and fraudulently for a piece of work to be done over two to three months.

Murugan further labelled McKinsey of being greedy, having agreed to keep R70m and to let Trillian keep the 30%. “It is questionable and unethical of McKinsey. McKinsey out of greed was happy with R70m and to give away the 30%.”

Murugan took issue with the fact that Trillian was paid even though it did not provide assistance for the project.

He added that although the G9 report does not have evidence of criminality on behalf of McKinsey, the Hawks will have to uncover that.

He also took aim at Eskom which was happy to “tick boxes” to make illegal payments. The officials had always found some way to make illegal payments.

Murugan highlighted how McKinsey had no oversight over Trillian and that Trillian reported directly to Anoj Singh.

McKinsey was paid out of Eskom’s savings, but Trillian’s payment came out of the budget of the CEO.

Eskom was also happy to pay R3bn for a service provider to monitor how much it would be saving.

“We are uncomfortable with that… If these shenanigans were allowed to continue, Eskom would have been in a deeper hole and crisis,” said Murugan. He added that Eskom would not have had savings and in turn Dubai would have more revenue and more apartments would be sold at Burj Khalifa. 

Murugan said that Singh should be interviewed by G9 as he has a lot to answer to. 

McKinsey-Trillian contract contravened PFMA

During his testimony, CEO of G9 Consulting, Rajie Murugan shared how his investigation into the relations between Eskom and Trillian revealed that the contract contravened the Public Finance Management Act (PFMA).

He shared how there were missing documents for the contract and that some documents were not signed. “This is against the PFMA and all relevant Eskom policy,” said Murugan.

When he confronted Prish Govender, part of the team which managed the contract between Eskom and McKinsey and its BEE partner Trillian, Govender said it was a procurement matter and that he should not be worried.

In turn Edwin Mabelane also said that the transaction as “above board”.

Evidence from a whistleblower indicates that she was instructed by Charles Kalima to approve the transaction, in favour of Trillian. “She complied with the request from her general manager,” said Murugan.

Audio clips played during the hearing reflect how Eskom officials approved the transaction because they did not believe they were doing anything wrong.

In another clip Murugan informs a supplier development partner that Trillian has a 0% BEE shareholding, to which he sounds surprised, calling it a “shocker”.

Murugan said this indicates the extent of the misrepresentation made by both McKinsey and Trillian. 

Trillian’s failure to cooperate with investigations is suspicious

Trillian’s failure to substantiate the legitimacy of its business relationship with Eskom adds weight to the idea that its dealings with Eskom were suspicious or not legal, said G9 CEO Rajie Murugan.

Murugan was speaking on G9’s investigation into relations between Eskom and Trillian, the investigation was abruptly halted when it became clear to the board tender committee that they would be probed, the committee on public enterprises heard.

Murugan indicated how G9 relied on Advocate Budlender’s report into State Capture, as Trillian was not forthcoming with information.  

“His (Budlender) access to Trillian, albeit limited, provided insight to what was covered.”

Murugan had an audio clip played of an interview with Prish Govender, who was part of the team which handled the contract between Eskom and McKinsey and its BEE partner Trillian.

In the audio clip, Murugan ask Govender why McKinsey and Trillian were not called in to determine their capacity to manage the contract. To this Govender replied that the capacity of the firms was a concern and that McKinsey had made a very clear presentation of how it would jointly with Trillian. 

Khoza interfered in G9 investigation - inquiry hears

G9 consulting was making significant progress into uncovering contraventions at state power utility Eskom, within six weeks of the investigation. The information pointed to corruption, money laundering and racketeering.

Murugan said the names behind these activities can only be uncovered if the investigation is allowed to re-commence.

Murugan explained how then-chairperson Zethembe Khoza had intervened in the investigation, having removed Johnny Dladla, the interim group chief executive from managing the investigation.

“This is highly unusual or in fact contrary to any or all governance protocols.” Murugan said this may indicate that Khoza himself may be implicated in the “Trillian debacle” and that he was derelict of his duties as chair of the board tender committee which approved the contract with McKinsey.

G9 was to make a presentation on August 30 2017, to the Audit and Risk Committee with interim board members in attendance.

“In hindsight I probably should not have informed the board that they were potentially guilty of contravening their fiduciary duties and that as a forensic firm, we had no intention to leave them out of the equation,” said Murugan.

Murugan believes that G9’s mandate was later terminated because members of Eskom’s board tender committee were to be investigated.

G9 has provided an affidavit to the Hawks, on the instructions of the new interim group chief executive Phakamani Hadebe and head of forensic at Eskom to institute criminal investigations against those involved. G9 has committed to assisting the Hawks in its investigations.

Findings of G9 investigation 'numbingly shocking' 

Advocate Dumisa Ntsebeza introduced Rajie Murugan, CEO of G9 consulting, which investigated the relationship between Eskom and Trillian to the portfolio committee of public enterprise on Tuesday.

The Eskom inquiry resumes today. he described the findings of what was investigated as “numbingly shocking” and informative.

Ntsebeza worked on a few investigations with Murugan at G9.

“What struck me of those investigations is how the Eskom’s leadership would abruptly terminate the mandate of the investigation at very critical moments.

“There would have been exposure of the most corrupt practices of leadership at Eskom,” he said.

“That still leaves me shuddering in disbelief that such large scale corruption and plain theft could take place,” said Ntsebeza.

Members of the portfolio committee Pravin Gordhan and Mondli Gungubele were not in attendance. Gordhan has been appointed public enterprises minister and Gungubele is deputy minister of finance.

Chair Daphne Rantho congratulated them in their absence, saying that they are credible members. 

Forensic firm to testify about Eskom payments to Trillian

The Eskom inquiry resumes on Tuesday. A forensic company which investigated allegations of irregular payments made to Gupta-linked Trillian Capital Partners will present evidence.

The portfolio committee on public enterprises will hear evidence presented by G9 Consulting Services, which was commissioned by Eskom. This relates to Eskom’s contract with consultancy firms McKinsey and its partner in the contract, Trillian.

The National Prosecuting Authority (NPA) found the contract to be invalid and the payments made unlawful.

In a separate interim report, G9 Consulting Services revealed that Eskom’s own legal advisors warned the state power utility not to enter into the agreement with McKinsey because the proposed revenue model may be illegal, amaBhungane reported.

Further reports by amaBhungane revealed that G9 went so far as to recommend that a criminal investigation be launched, specifically with regard to Eskom’s relationship with Trillian.

Former CFO Anoj Singh and his senior management team including Edwin Mabelane, Prish Govender and Charles Kalim have been implicated in the G9 report. Singh’s testimony to the inquiry in January was dominated with “I don’t knows”.

Singh said all the information he presented was fact-based, supported by evidence he had. But former finance minister and member of the committee Pravin Gordhan lambasted him for not taking responsibility for what happened at Eskom.