Eskom's Matshela Koko: I've declared all my conflicts of interest

Johannesburg - Suspended executive Matshela Koko testified at his disciplinary hearing at Eskom on Thursday that he took all steps necessary to declare a possible conflict of interest relating to his stepdaughter.

But he also knew the relationship would be used against him when it came to light, he said. 

Koko faces charges relating to nepotism and conflict of interest. He allegedly failed to declare, accurately and in a timely manner, that his 26-year-old stepdaughter Koketso Choma’s company, Impulse International, was doing business with Eskom Generation when Koko was head of the unit.

Evidence leader for Eskom Advocate Cassim Moosa closed Eskom’s case against Koko, after several Eskom witnesses against Koko failed or refused to testify.

On Thursday Koko painted a picture of his wife, Khomotso Choma, as a super businesswoman who has done well running a number of businesses. Choma, who won The Apprentice reality television show in 2005, ended up at Group Five as part of her prize.

But Koko said he was so distressed about a possible conflict of interest that he ordered her to sever all ties with the firm. She then moved to Basil Read and again Koko was apprehensive about a possible conflict of interest.

Handling conflict of interest

“One evening Mrs Koko told me she would visit Kusile,” Koko testified. This was because one of her businesses supplied materials to contractors at Murray & Roberts at Kusile.

Koko questioned his wife on this, and ordered her to pull out. “She stopped immediately.”

Koko’s counsel Frans Barrie SC asked why Koko was so sensitive over this. Koko replied that he was extremely careful not to violate Eskom’s ethics policies and code of conduct.

He said he first became aware of his stepdaughter’s interests in Impulse in September 2016, during an informal conversation about her future after she finished her chartered account internship at PwC.

Choma said she didn’t want to be an employee that worked, but wanted to follow in her mother’s footsteps by employing people.

“She told me her future lay with Impulse International.” Koko added it emerged that she was both a director and shareholder in the company.

Koko said he immediately ordered her to resign, and to take legal advice about her role. She subsequently resigned and the matter was laid to rest.

The former Eskom executive said he then updated his declaration of interests, printed it out and handed it to former Eskom boss Brian Molefe, who approved it.

He challenged evidence by previous witnesses who questioned why he hadn’t submitted it electronically, by stating that the electronic system was not equipped to handle this particular type of declaration.

The matter arose again in February, when Koko was appointed as the new interim Eskom chief executive. During a conversation with his wife in  February, she told him that Koketso was a trustee of the Mokoni Trust, and that the trust held a 35% share in Impulse.

Koko testified that he was immediately distressed and ordered Koketso to quit. But she and her mother stood their ground, saying that they had obtained legal advice that said her shares were above board.

“I didn't want it, because I knew how it would be abused.”

Declaration to Ngubane

He then declared this new revelation in February in a memorandum to his supervisor. Because he was now the boss, he had to submit his declaration to former Eskom board chair Ben Ngubane.

When he discussed his declaration with Ngubane, he saw the memo had a yellow sticker attached, asking “SD” to look at carefully. Koko understood SD to refer to Eskom group secretary Suzanne Daniels.

He said Ngubane signed off at the end of the discussion, despite misgivings that he should investigate the conflict further.

“I can't investigate myself, I brought it this my supervisor to handle,” he said. “The policy is clear, my manager must look at it.”

The information was then leaked to the press, and the Sunday Times reported in March that Choma raked in contracts worth about R1bn for her company from the state utility through Koko.

“There was only one copy of this declaration and Daniels had it,” said Koko, implying that Daniels had leaked the information.

Koko's testimony is ongoing, and he still has to be cross-examined by Moosa. 

Fair and transparent

On Wednesday the power utility said in a statement it had pledged to conduct a “fair and transparent” hearing, and denied that proceedings had collapsed “and that the entire process was a farce with a predetermined outcome”.

Eskom interim chairperson Zethembe Khoza said Eskom “had no option but to continue with the hearing in the absence of these witnesses and to close its case on 25 November 2017”.

EE Publishers investigative editor Chris Yelland, who attended the hearing last Saturday, reported that the final outcome of the disciplinary hearing, expected by about December 10, may simply be a precursor to a massive settlement and golden handshake to see the back of Koko.

Khoza said Eskom “wishes to unequivocally state that this disciplinary hearing is being conducted in a fair, professional, and transparent manner, with the media being granted permission to attend what would ordinarily be treated as an internal matter".


* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER


ZAR/USD
16.60
(+0.68)
ZAR/GBP
21.42
(+0.82)
ZAR/EUR
19.51
(+0.48)
ZAR/AUD
11.94
(+0.29)
ZAR/JPY
0.16
(+0.74)
Gold
1909.60
(+1.20)
Silver
24.11
(+3.33)
Platinum
897.01
(+1.03)
Brent Crude
42.12
(+1.78)
Palladium
2316.00
(+1.04)
All Share
54446.78
(+0.34)
Top 40
50159.14
(+0.23)
Financial 15
10158.72
(+0.86)
Industrial 25
73766.43
(+0.79)
Resource 10
53032.08
(-0.66)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1402 votes
It depends on how the funds are used.
73% - 9090 votes
No. We should have gotten the loan elsewhere.
16% - 1998 votes
Vote