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Several arrested for fraud regarding contract at Kusile power station

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Two former Eskom senior managers, two business directors, and seven companies are expected on Thursday to appear in the Johannesburg Regional Court for alleged fraud, corruption and money laundering.

The suspects were arrested early Thursday morning in Mpumalanga, Limpopo and Gauteng by the Hawks’ Serious Commercial Crime Investigation team in collaboration with the National Prosecuting Authority’s Investigative Directorate.

According to a joint press statement from the Hawks and the NPA, “Investigations began when suspicions were raised into the construction of two large projects at Medupi and Kusile power stations.  This revealed that there was apparent gross manipulation of contractual agreements between contractors, Eskom employees and third parties at Kusile power station.”

The statement further says, “In-depth investigations pointed to the fact that the contract was manipulated in a number of ways including, amongst others manipulation of  Eskom’s procurement system by officials who occupied Senior Management positions, descoping of the contract at Kusile without justification and with conflict of interest by Eskom employees.”

The contract in question was approved in 2015. It amounted to R745 million to build two Air Cooled Condensers (ACC) units at Kusile power station.

It is alleged that from February 2015 to July 2017, the appointed companies, other related entities and individuals shared approximately R30 million amongst themselves.

 

 

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