ANALYSIS

Law enforcement, witnesses and McKinsey: The missing factors in Eskom’s pursuit of the Trillian millions

By Jessica Bezuidenhout 22 August 2019
Caption
Illustration Image: Eric Woods / Unsplash/Manprit Kalsi / Gallo Images/Jaco Marais

Wouldn’t it be nice if someone in law enforcement could say: ‘Let me have a look at that docket. What witness statements do we have? Dust off the bank records. Right, let’s get those warrants.’

Eskom has, since 2017, been hounding Trillian Capital Partners for R595-million the company allegedly received in unlawful payments following an off-grid partnership with global consulting company McKinsey & Co.

Fact: the power utility faces an unprecedented cash crisis. While politicians, bureaucrats and unions squabble over what needs to be done to arrest this dire situation, the impact of years of mismanagement, irregular expenditure and State Capture continue to haunt the country’s power utility.

Against a R59-billion government bailout, the nearly R600-million that Eskom is demanding from Trillian may for all intents and purposes be considered peanuts, but its enough to power Johannesburg for a month.

But court papers filed in December 2017 for an Asset Forfeiture Unit preservation order against Trillian, proved the bank accounts were empty; curators found no recoverable assets. Nada. Zilch.

As a result, the National Prosecuting Authority (NPA) abandoned its mission for civil recovery of the funds. Some 20 months later, in August 2019, that picture remains unchanged and Eskom continues its fight while the NPA seems to be watching from the sidelines as a party to the drawn-out court spat.

Some may rightfully argue that it is correct that Eskom keeps at it, it’s taxpayers’ money, after all.

But it can also be argued that Eskom is throwing a whole lot of good money after bad as on the face of it, Trillian seems hell-bent on fighting corruption claims via civil proceedings after a court order that it pays back the money.

Even if Eskom is eventually successful, there could be years of appeals before SA Inc sees a penny of that stash.

It is understandable that in the anger over State Capture, particularly the overtly greedy role played by the Guptas and their cronies — politicians, private companies and public officials included — that South Africa needs villains, someone to blame and nail for the mess.

And the Trillian case has certainly turned CEO Eric Wood into something of a State Capture poster boy while the rest of the known culprits go about their daily lives.

His former partners at Regiments Capital, a company known to have contributed to Gupta Inc via kickbacks to front companies such as Homix, no longer publicly defend State Capture claims.

The prime suspects — linked to both Regiments and Trillian — the Guptas, packed their bags and ill-gotten gains and headed for mansion L35 in Dubai in what now feels like many moons ago.

Their one-time rainmaker, Salim Essa, once the majority shareholder of Trillian, seems mortified by the prospect of returning from Dubai without the guaranteed cover of the once-powerful Gs, or a former president.

It’s not hard to imagine that things in Dubai are tense, that there is word of growing mistrust between the Guptas (who can probably acquire new passports for life on Vanuatu — a South Pacific island — tomorrow, should they need to) and the rest of their once-loyal brotherhood of servants.

Build a case, smoke out those witnesses

Is it not time the Hawks or the NPA make a firm move to engage some of those sitting in Dubai?

Essa to this day is merely “a person of interest” to law enforcement, not a fugitive from justice.

Back home, there is almost radio silence from parties such as former Eskom bigwig Anoj Singh, who is implicated in the Trillian scandal.

There is little sign that law enforcement has sought to have a word or take a statement from the likes of Singh (whose woes run way beyond Trillian, by the way) or Wood, for that matter.

There is also no indication that others who have thus far enjoyed great cover in the Trillian scandal have been approached by law enforcement for explanations or assistance.

That’s because much of the State Capture clean-up has zoomed in on familiar characters, shielding many who were in the thick of things at Trillian and elsewhere: some were there when the deals and payments were made; they were co-conspirators, enablers and facilitators or on-site service providers, some raked in staggering fees from Trillian at R800,000 a month.

But there were also employees, people who were ordered to tick boxes, those who were tasked with drafting loan agreements used as a guise for payments to Essa or Gupta-linked companies, those who know that Essa had had a plan for the Eskom millions before it even arrived in Trillian’s bank account.

Some of those are potential State witnesses, potential 204s, or 205s, who can help secure human intelligence for the mountain of leaked bank statements, emails and service-level agreements that continue to overcomplicate what seems to be a simple criminal investigation: an investigation that seriously needs to move from docket to charge sheet; one that people should be charged for and for which they should be allowed to clear their names, or else trade their Gucci suits for something orange.

A mere Google search of Trillian produces an extended list of potential witnesses: Mo Bobat, Tebogo Leballo, Faheema Badat, Proppie Fraser, Althaf Emmamally, Clive Angel, Marc Chipkin, Stan Shane, Mark Pamensky. These individuals were all associated with Trillian at one stage and in one or other capacity.

Trillian bank records in the public domain show staggering flows of cash to Gupta-linked entities such as Cutting Edge and Zestilor, both of which were in the Gupta stable. These companies had directors, auditors and staff that could prove vital in building the case against those responsible for wiping out Eskom’s R600-million.

Individually or collectively, they either had no clue of what Wood or Essa were up to or they could greatly assist investigators to figure out whose names ought to appear on the indictment.

While law enforcement seemingly meandos through it all, important bits and vital characters are falling through the cracks.

This brings me to the McKinsey factor. The firm, also a party to the ongoing litigation between Eskom and Trillian, has remained vigilant.

For this reason, it is necessary to consider an ill-explored question about why Eskom failed to capitalise on that moment in Parliament in late 2017, when McKinsey offered to pay back fees earned under the controversial Eskom contracts through which Trillian ultimately benefited.

On 11 November 2017, McKinsey’s London-based South African senior partner David Fine so eloquently apologised to the nation and confirmed it would return its portion of the fees.

There were some significant concessions in that speech: that McKinsey’s own processes were “inadequate” because it had missed a letter written to Eskom by one of its own, Vikas Sagar, “authorising” the utility to pay Trillian directly, even though McKinsey’s own due diligence found it could not partner with the company.

Significantly, Fine said McKinsey ought to have insisted Eskom produce written approvals from National Treasury before it began work on the project.

McKinsey must have had a helluva great team of negotiators, otherwise why on earth did Eskom not go at them for the full R1.6-billion? Sure, the company may have had a valid legal argument for why not, but in that moment, on that day in November 2017, there was a great opportunity to claw back all the cash, thereby cutting out two years of civil proceedings to put the time and effort where it belongs — in the criminal case.

But Eskom was satisfied taking just short of R1-billion from McKinsey and headed to court to set aside the entire contract in the hope of squeezing the balance out of Trillian — by then already publicly condemned and broke.

And so battle Eskom vs Trillian ensued, with CEO Wood giving as good as he gets as court papers fly around and South Africa waits for the paper battle to turn into the proverbial street fight in criminal court.

Now wouldn’t it be nice if someone in law enforcement could say:

Let me have a look at that docket. What witness statements do we have? Dust off the bank records. Right, let’s get those warrants.” DM

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