Eskom managers’ fraud trial date set

2014-12-07 19:00

They were supposed to bring power to thousands of residents in Khayelitsha, Cape Town, but top Eskom managers allegedly pocketed millions for themselves instead.

The trial of David Malherbe (59), who has since left the power utility, Matome Peter Sebola (40) and Jacob Machinjike (51) is scheduled to begin in Bellville’s Specialised Commercial Crimes Court on January 28.

The trio appeared briefly in court last week.

A source close to the investigation told City Press the trial should expose “plenty of rot” in the upper echelons of the floundering parastatal – which once again had South Africans cursing this week as load shedding reached stage three and left millions in the dark.

According to a charge sheet that City Press has in its possession, Malherbe, Sebola and Machinjike are charged with fraud arising from the allegedly irregular awarding of contracts worth R65?million.

Stealing R65?million from Eskom is listed as an alternative charge. Malherbe is also charged with money laundering.

Top business crime cop Lieutenant Colonel Piet Viljoen headed the investigation, which led to Malherbe’s assets being frozen last year ahead of the prosecution.

An engineer at the power utility told City Press the most galling aspect of the deal that’s landed the three in the dock was that the money was earmarked to provide power to residents in Khayelitsha.

Malherbe, Sebola and Machinjike were board members of an Eskom subsidiary, PN Energy Services (PNES), which was founded in 1993 to bring low-cost electricity to 6?800 people in Khayelitsha.

But according to investigators, Malherbe used PNES to bankroll his lavish lifestyle – he allegedly pocketed at least R21?million in cash, which he used to buy a posh home in Gordon’s Bay and 4X4 vehicles.

Police say Sebola and Machinjike were also in on the deal.

“The accused [Malherbe, Sebola and Machinjike] decided, conspired and agreed in flagrant disregard of their positions as directors of PNES and employees of Eskom to facilitate an opportunity for [Malherbe] to gain income by causing PNES to enter into contracts with [Energy Utility Services],” the charge sheet reads.

If found guilty, the men could face 15 years each in jail.

“They played with that money,” a source within the parastatal told City Press. “Meanwhile, the work done in Khayelitsha is cheap and of unreliable design. Just a while ago a little girl died while closing a gate – she was electrocuted,” the source said.

The trio’s arrest should have come as no surprise to Eskom: in 2009, two forensic reports – by Mazars and KPMG – found irregularities with PNES’ awarding of contracts to Energy Utility Services, a company owned by Malherbe.

These reports were presented at Eskom’s executive committee meeting and to then chairperson Mpho Makwana in May 2010. But they allegedly did not alert the police.

“Absolutely no action was taken against all the executive managers involved,” the Eskom source, who then approached police to encourage an investigation, told City Press.

City Press put detailed questions to Eskom and enquired about its alleged failure to notify police.

The parastatal responded in an email: “Eskom cannot comment on the matter until the court process has been concluded.”

Malherbe left Eskom to pursue his own business interests, among them Energy Utility Services, in 2009.

But Sebola and Machinjike are still employed at Eskom. In fact, Sebola was recently promoted. Formerly the general manager for Eskom’s distribution in the western region, he was made general manager of contract management in the organisation’s group capital division on July 1.

Machinjike is general manager of Eskom’s transmission grid.

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