Antionette Slabbert
4 minute read
20 Oct 2017
1:02 pm

‘No factual evidence’ Koko awarded R66m contracts to stepdaughter’s company

Antionette Slabbert

No proof to support press reports that former acting CEO Matshela Koko awarded his stepdaughter's company contracts worth millions, says forensic investigator.

Former Eskom executive Matshela Koko. Picture: Moneyweb

A forensic investigator Annemari Krugel of Nkonki Incorporated testified in the disciplinary hearing of suspended Eskom boss Matshela Koko that no factual evidence could be found to prove that “Eskom lavished its bosses daughter with R1 billion contracts” as newspaper reports suggested.

Koko is facing six charges, four of which relate to contracts awarded to Impulse International, a company of which his stepdaughter Koketso Choma was a director and shareholder.

Koko told investigators that he found out in August/September last year that Choma was a director of the company and held 25% shares in Impulse. He then requested her to relinquish the position and shareholding to prevent a real or perceived conflict of interest.

When he realised in February this year that she did not part ways with Impulse, but moved the shareholding to the Mikoni Trust of which she was a trustee and beneficiary, he made a declaration to Eskom in terms of its conflict of interest policy.

The first four charges relate to these events.

Krugel, an experienced former state prosecutor and magistrate, was called by Eskom to testify about the Nkonki report. She told the hearing that Nkonki was appointed by law firm Cliffe Dekker Hofmeyr (CDH) to find the facts pertaining to the conflict of interest matter.

Krugel said Nkonki delivered the report to CDH and that CDH dealt with the legal aspect of the matter. It obtained a legal opinion from advocate Azhar Bham. This opinion was incorporated into the Nkonki report and resulted in a second, final report that differed in certain respects from the first.

During the investigation Nkonki questioned Eskom staff, Koko, his wife and her attorney as well as Koko’s stepdaughter and Pragesan Pather, the CEO of Impulse International.

Krugel testified that Mrs Koko, a business woman in her own right, said she met Pather late in 2014. He approached her as a prospective BEE partner, but she rather introduced her daughter to him in 2015. Choma was at that stage a student. She became a director of Impulse in March 2016.

Pather told the investigators he only knew Koko socially and they never discussed his business with Eskom.

Krugel testified that there was no evidence that Eskom found out about Koko’s potential conflict of interest before he made the declaration in February this year.

She said there was no evidence that Koko was involved in the award of the ten contracts Eskom had with Impulse. Nkonki could find only one document with Koko’s signature relating to an Impulse contract and that was from before Choma had a link with the company.

Under cross examination by Koko’s legal representative advocate Frans Barrie SC, Krugel testified that the investigation was sparked by an article about Koko’s alleged conflict of interest published in the Sunday Times on 26 March this year.

She said Koko, his wife and stepdaughter gave their full cooperation with the investigation. Mrs Koko and Choma were accompanied by their legal representatives during the interviews with Nkonki.

Krugel testified that the Impulse contracts were awarded before Koko was appointed interim Group Chief Executive in December 2016. At the time he was head of generation and served on a tender adjudication committee that dealt with tenders valued at between R300 million and R750 million. The Impulse tenders were smaller and would therefore not have served before him, she testified.

She testified that allegations that Koko influenced the tenders to favour Impulse and ultimately his stepdaughter are incorrect.

The two Impulse contracts that carry his signature had nothing to do with Choma, Krugel testified.

She told the hearing that Eskom employees were required to declare their own interests as well as related and inter-related persons. This could include his wife and stepdaughter.

Krugel said the information leaked to Eskom’s auditors that Choma was on Koko’s medical scheme to establish her as an inter-related person, was false.

Barrie put it to Krugel that following the Nkonki report Bham raised certain questions that he held should be put to Koko and which apparently informed the charge sheet against Koko. According to Barrie Koko never had an opportunity before the hearing to respond to it.

One of these questions was why Koko failed to declare his possible conflict of interest in August/September last year, when he became aware of Choma’s link with Impulse. Nevertheless Eskom has not charged Koko with that.

Barrie said Koko did make a declaration to then Eskom Group Chief Executive Brian Molefe. This was however not done on the Eskom electronic system, as the template on the system did not cater for the specific circumstances.

Krugel confirmed that she was aware of that declaration.

Krugel also confirmed that Koko in the past without fail declared his wife’s business interests when necessary. He in fact on three occasions asked her to distance herself from business deals that could have resulted in a conflict. This included deals with Basil Read, Group Five and as a supplier for Murray & Roberts,  who all did work for Eskom.

Every time she walked away from the deals.

The hearing will continue on Friday night and over the weekend. Eskom is expected to call another investigator to testify about a report regarding a whistleblower’s allegations against Koko.

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