'We alerted SIU to R474m malfeasance' - technology group EOH

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SIU head Advocate Andy Mothibi.
SIU head Advocate Andy Mothibi.
Tebogo Letsie, Gallo Images, City Press
  • The SIU will probe four tenders issued by the Department of Water and Sanitation to technology group EOH.
  • EOH says the SIU probe came about after it lodged a complaint with the investigative unit.
  • The technology company said its new EOH leadership remained committed to doing business ethically.

The Special Investigative Unit's (SIU) probe into R474 million worth of tenders - awarded by the Department of Water and Sanitation to technology company EOH - was instituted after the latter lodged a complaint with the investigative unit. 

Responding to the SIU's announcement on Thursday that the unit would be probing four tenders awarded to EOH, the company's Group Chief Risk Officer, Fatima Newman, told News24 that "the SIU actions are in response to wrongdoing involving former EOH employees that was brought to the attention of the SIU by EOH". 

Newman said "in order for EOH to compensate the Department of Water and Sanitation, (via the SIU) for such wrongdoing, it was necessary for the SIU to be mandated to investigate the contracts. This then gave rise to a Presidential Proclamation, which has now been published". 

"EOH has not only cooperated fully with the SIU to bring this matter to a conclusion, but has proactively sought to reimburse the department for wrongdoing involving former employees identified in the EOH forensic investigation."

In February 2019, the new EOH board appointed ENSafrica to investigate the firm's business dealings covering the period 2015 to September 2018 following a discovery that its former executives were implicated in a wide range of tender corruption. 

Newman told News24 that from the inception of the ENSafrica forensics investigation in February 2019, EOH has transparently and proactively reported wrongdoing to the authorities. 

READ | SIU probes R474m Department of Water and Sanitation IT tenders

"Furthermore, prior to engaging in settlement negotiations with the SIU, on 31 May 2019, EOH reported the wrongdoing to National Treasury and proposed to compensate the state for identified irregularities regarding the Department of Defence and the Department of Water and Sanitation contract."

She alleged that EOH "subsequently entered into an Acknowledgement of Debt with the SIU at the end of September 2020 with regards to the Department of defence contract" while commencing monthly payments in terms of the acknowledgment of debt from 5 October 2020. 

Newman said:

The terms of the compensation to the Department of Defence we disclosed at the EOH 2020 year-end results presentation on 2 December 2020. In addition, this disclosure was repeated when EOH released its interim results on 14 April 2021. EOH has taken action to reach a similar agreement with the SIU regarding the DWS contracts. In this regard, negotiations with the SIU on the DWS contracts are advanced, and it is anticipated that an agreement on compensation to the DWS will be concluded in the near future.
  

She said EOH had not only reported wrongdoing by the old EOH management, but initiated action to recover losses caused by the perpetrators of wrongdoing.

"The new EOH leadership remains committed to doing business ethically as well as being a good corporate citizen."

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