Business Maverick


How EOH got fleeced: The case of the ‘fronts for hire’

How EOH got fleeced: The case of the ‘fronts for hire’

A trail of fake invoices and front companies hid a plot to siphon millions from a police contract with tech giant EOH, according to a report to the Zondo commission. The money allegedly ended with a senior EOH executive’s company – from where ANC notables were paid.

A hard-hitting affidavit and supporting emails provide a window into how millions of rands were sucked from the sprawling technology conglomerate EOH — and implicate prominent black business lobbyist George Sebulela, among others, in facilitating the alleged fraud. 

Details of how “enterprise development partners” were approached allegedly to spirit away R42.5-million of a R210-million police tender are contained in the submission by Steven Powell, head of forensics at law firm ENSafrica. 

The report was submitted to Zondo in November last year but has languished unnoticed at the bottom of a far larger submission, previously reported by amaBhungane, dealing with how Johannesburg mayor Geoff Makhubo allegedly got EOH secretly to fund the ANC through front companies.

Powell resumed his testimony today.

EOH’s public sector division, EOH Mthombo, won the R210-million tender from the South African Police Service (SAPS) in April 2016. 

Powell’s submission presents evidence that, almost immediately, EOH executives went to work finding a willing sub-contractor to funnel 20% of the cash to a mysterious third party without commercial justification. 

From there most of the money seemingly got paid forward to another company belonging to EOH executive Jehan Mackay, previously shown to have made repeated payments to ANC leaders.

EOH has been under scrutiny since 2017, when amaBhungane first raised questions about EOH’s political connectivity. 

Since 2018 a new leadership, under chief executive Stephen van Coller, promised to clean up and hired Powell’s forensic experts at ENSafrica to investigate activities at EOH Mthombo between 2014 and 2017 — see The big clean-up at EOH beneath.

Powell’s Zondo submission finally casts light on what ENSafrica unearthed. EOH had previously only released very generalised information on the investigation’s findings. 

The Powell submission charts how a set of EOH executives allegedly tried to use two different sub-contractors to move the R42.5-million, both of which seemingly got cold feet or objected to getting involved in the obviously suspect deal. 

It then shows them allegedly getting lucky with the third option: business lobbyist George Sebulela — at the cost of a R1-million “handling fee”.

Sebulela is a ubiquitous presence on the boards of business associations and lobby groups including the Black Business Council, the African Entrepreneurs Council, the Brics Business Council, the Black Business Executive Circle and the South African United Business Confederation. 

Sebulela is also on the board of state-owned tourism marketing company Brand SA, where he has been the public face of an attempt to deflect allegations of corruption. He resigned from the Eskom board two and a half years ago after Eskom was made aware of Sebulela’s relationship with EOH, which had bid for a multibillion-rand IT contract at the utility.

Now he has been fingered as one collaborator in a broader scheme allegedly used to extract hundreds of millions of rands from EOH after the company scored massive public sector tenders.

Sebulela denies wrongdoing.

Over time, the mechanism described by Powell was allegedly used to steal at least R865-million using a variety of supposed enterprise development partners like Sebulela.

Cast of characters

At the heart of the transactions were individuals tied to a company EOH had acquired in 2013: TSS Managed Services – with the flamboyant Mackay the most prominent.

Mackay arrived at EOH from TSS Managed, and was appointed head of Mthombo, the EOH public sector subsidiary. Also from TSS Managed came Patrick Makhubedu, who became head of public sector business development under Mackay. Alongside them was Rene Bredenkamp (now Jonker), a TSS Managed accountant who became an EOH divisional financial director. 

And then there was the late Christo de Bruin, who died with his wife in June last year when a helicopter he was piloting crashed outside Grand Central Airport in Midrand.

De Bruin had consulted to a company called Forensic Data Analysts (FDA), which was associated with EOH between 2015 and 2017. According to FDA boss Keith Keating, De Bruin had also consulted directly to EOH.

Powell sets out a sequence of emails and invoices that suggest that the individuals from EOH and TSS Managed used sub-contractors to act as fronts to siphon money out of the EOH group.

The R210-million SAPS tender, for installing Huawei equipment and three years’ support, was awarded to EOH Mthombo in February 2016. SAPS paid EOH virtually the full price upfront in April. 

On 15 April, Mackay’s assistant, Charzé Gordon, sent emails to two companies. One was Vitom Technologies — led by Toko Mnyango, an EOH Holdings director. The other was Alteram Solutions, a company that had done work for the revenue service and the department of water and sanitation among others.

Gordon asked representatives of both Vitom and Alteram to “please send me the company details… We have to send to someone to create an invoice for you.” 

Both companies sent the requested details to Gordon within the hour and Gordon immediately forwarded them to De Bruin at an FDA email address.

That same afternoon De Bruin came back to Gordon with two invoices on behalf of a company called Martistyle. These invoices were addressed to Vitom and Alteram, for R25.7-million and R35.4-million respectively.

1. Martistyle Invoices 15 A…

Gordon did not return calls and messages from amaBhungane

The day after receiving the Martistyle invoices, Gordon emailed them to Rene Jonker, divisional finance director at EOH with instructions:

Hi Rene.

Please check the attached invoices as discussed yesterday

Jehan asks how do you want to go about paying this?

So Christo has addressed this to VITOM and ALTERAM

Thus VITOM and ALTERAM will issue us with invoices to this value — we will pay them — they will then pay Christo.

Please let me know urgently



In a nutshell, Vitom and Alteram needed to invoice EOH before they could pay Martistyle. On 20 April Vitom duly sent the requested invoice to EOH and on 22 April Alteram did the same. The two invoices are for an identical sum: R42,452,373.53.

2. Identical Vitom and Alte…

The Vitom invoice was for “SITA 1221 Workshare SAPS NNUP [National Network Upgrade Project]”. The Alteram one was, similarly, for “SITA 1221 SAPS NNUP Phase l”. 

The two-day gap between the invoices seems to buttress Powell’s conclusion:

“It appears the initial plan was to use Vitom as the conduit to pay Martistyle. Vitom issued an apparently fraudulent invoice to EOH Mthombo for R42.5m for this purpose. It appears Alteram was then substituted for Vitom and it too, issued an apparently fraudulent invoice to EOH Mthombo for R42.5m, using the same invoice narrative as VITOM.”

Cold feet

But then came a twist. “Neither Vitom’s nor Alteram’s invoices were paid,” Powell said. Partway through the transaction, both companies seem to have had second thoughts. Indeed, they have told amaBhungane they cooperated with the ENSafrica investigation.

Vitom chief operating officer Nolwazi Tyamzashe said that the company was a victim, not a perpetrator. 

“We have laid a criminal case with the South African Police Service and it is being investigated by the Commercial Crimes Unit in Pretoria where the majority of issues are ventilated in that criminal affidavit,” she told amaBhungane

Vitom was an enterprise development partner for EOH which Tyamzashe says meant they “would often be requested to manage independent service providers. This would mean that … you also have to pay the independent service providers that you manage for services rendered. EOH was the one appointing the independent service providers”. 

This is what was going on with Martistyle, she suggested. In this instance, it appears that Vitom quickly got cold feet.

On 22 April, two days after providing its invoice, Tyamzashe sent an email to Mackay, demanding additional documentation to fend off “scrutiny”.

Good Day Jehan,

Pursuant to my text on Wednesday, Vitom has submitted the 37m [before VAT] as requested. With the scrutiny that is going to come with this invoice (this is the biggest invoice Vitom has ever billed), from a SARS and bank perspective, I would like to be able to get the below information for audit purposes: 1. Workshare agreement for this deal 2. A list of the suppliers to be paid 3. The profit share portion for Vitom.

According to Tyamzashe, she received no clear answer and the transaction died a quiet death. “There was no indication that payment would be affected or not. Vitom dispute that this invoice was fraudulent as it was per instruction of EOH.”

Alteram was also an enterprise development partner. According to its chief executive, Philip Arnold, it had done work for EOH in the past but pulled out of this transaction because it was seemingly just going to be paying the subcontractor the entire sum it billed EOH.

“Whilst initially Alteram viewed this as an opportunity to do further work with EOH, when it became clear to Alteram that there was no active role for Alteram itself in the workflow, Alteram declined to proceed with this opportunity… I instructed [Jayesh Makan, then chief financial officer] to reverse the invoice.”

Read Alteram’s full response here.

6. Response From Alteram


Enter George Sebulela

On 25 April, three days after Tyamzashe’s “scrutiny” email, EOH turned instead to another pre-existing partner: George Sebulela. 

Sebulela is the 100% owner of a company called Sebtech, according to Powell, quoting documents from 2014. Sebulela received much the same instruction as Vitom and Alteram, but the evidence submitted to Zondo shows he actually went through with it.

On 25 April, Gordon sent him an email: “Hi George. Please urgently send invoice to EOH Mthombo and use the details below, please add the VAT.”

The “details below” were the same as what Vitom and Alteram had billed for: “SITA 1221 SAPS NNUP”.

The amount “due” was also exactly the same: R42,452,373.53.

The requested invoice arrived from Sebtech later that day and was instantly settled by EOH.

3. Sebulela Invoice for R42m


And the same process followed as with Vitom and Alteram. Sebtech received an invoice from Martistyle, for the same amount Sebtech got from EOH.

4. Martistyle Invoice to Se…


“Please advise when this payment will be made ASAP,” Gordon asked Sebtech’s financial administrator, Freeman Mhunduru. She followed up several times that day, asking if the money had gone through or not.

Sebtech insisted on remuneration.

“Hi Rene [Jonker], I will instruct our Bank to transfer the invoiced amount minus VAT and a handling fee for R1,000,000.00: R36,238,924.20. Please confirm if all is in order. Regards,” Mhunduru said by email.

He however paid the VAT plus the R1-million to Martistyle in full. Then he invoiced EOH for the R1-million handling fee, once again billing for work on SITA 1221 SAPS NNUP PHASE 1.

5. Sebtech Invoice for R1m


Sebtech was only paid R500,000 immediately. Jonker told Mhunduru that the rest would “be discussed between Patrick [Makhubedu of EOH] and George [Sebulela]”. Later in the year, another R500,000 was paid.

After describing that exchange, Powell’s affidavit adds: “From the investigation in this matter, it appears Sebtech did not provide goods or services to EOH Mthombo in exchange for the R42,452,373.53 paid to it.

Sebulela has denied that Sebtech did nothing for its payment. He told amaBhungane:

“No reservations or concerns have ever been raised with us regarding non-performance emanating from our partnership [with EOH]… 

“In this regard, we dissociate ourselves to any claims or malicious allegations and statements made in your question against Sebtech.”

He added, “For all other future enquiries, we will therefore suggest that you engage with EOH directly. We will not comment any further on this matter.”

Who is really getting paid?

This system for allegedly syphoning tender money out of EOH begs the question: who was actually behind Martistyle?

The CEO of the obscure company was the late Christo de Bruin. Like him, a second contact on the Martistyle invoices used an FDA email address. 

Martistyle had two directors: Florence Kalipa and Beauty Cibangu. In response to questions, Kalipa said that only De Bruin could answer them: “Please note that Christo De Bruin was a founding partner and thus the CEO of Martistyle responsible … for all transactions with our contracting partners and therefore also Sebtech & EOH in this case.

“Martistyle can confirm that the services to the client were duly rendered as contracted and Sebtech was invoiced for the services, as they were contracted to EOH.”

Kalipa also said that she had “no knowledge” about attempts to route the money via Vitom and Alteram. “Therefore, to the best of my knowledge and with the information I have, I refute any claims or allegations that Martistyle as a company was involved in fraudulent transactions.”

FDA’s Keating told amaBhungane there was no link between Martistyle and FDA whatsoever.  

“Christo de Bruin and [the second Martistyle contact person] were never employees of FDA. They both did have email addresses for the consultancy work they were engaged for. If they did not limit the use of those email addresses to the work they were contracted for, that is regrettable.”

The money trail however does not end at Martistyle.

Powell’s evidence strongly suggests that Martistyle was itself a conduit for payments to Tactical Software Systems (TSS). This company belonged to the Mackays (Jehan and father Danny) and is not to be confused with the TSS Managed Services they had sold to EOH. 

On the face of it, it looks like Mackay used a chain of fronts to send EOH money to his own company while he was running EOH’s public sector arm. 

AmaBhungane put this to Mackay and although he acknowledged receipt of our questions, he did not respond.  

In an email dated 17 May 2016, Martistyle’s De Bruin asked about a “back-to-back” agreement:

“Jehan, Following our meeting last week, you asked me to remind you to get Charze to conclude the back to back agreement for the SAPS Phase 1 Support on contract 1221/2014 between Martistyle and TSS. Please let me know when the agreement is finalised and ready for signature. Regards,”

Mackay forwarded this to his assistant, Charzé Gordon, with instructions:

“Hi Charze. Please prepare the same agreement we have with maristyle and eoh for sap support instead in this case eoh will be replaced with maristyle and maristyle replace with TSS. Tx u. jehan.”

This suggests that Mackay was paving the way for De Bruin (as Martistyle) to deliver a portion of the extracted cash back to himself, Mackay (as TSS).

In testimony before the Zondo commission today, Powell showed how Mackay allegedly used TSS to clandestinely fund ANC activities and personalities.

Multi-purpose middleman

The SAPS tender was not the only one that Powell examined. According to his submission, Sebulela provided EOH with the same kind of fronting service for at least one other tender, this time involving the National Prosecuting Authority. 

In that instance, he may have been a conduit for clandestine funding to the ANC.

EOH Mthombo won a R68.7-million tender from the NPA in December 2015 to provide ICT support for three years. Over the course of the contract, EOH paid Sebtech more than R2-million. 

“From the investigation in this matter, it appears Sebtech did not provide goods or services to EOH in exchange for the R2,100,000.00 (ex VAT) paid to it,” Powell alleged.

Instead, the money was largely paid onwards to a company controlled by EOH’s Makhubedu called Mfundi Mobile. Sebtech kept a small “management fee”.

Mfundi was a vehicle for funding the ANC, according to Powell’s submission to Zondo. DM

This article was amended after publication to remove certain references to Forensic Data Analysts and Keith Keating disputed by Keating.

The big clean-up at EOH

EOH chief executive Stephen van Coller was brought in to clean up the group in 2018 after persistent concerns about governance, including questions raised by amaBhungane in 2017 which prompted an aggressive legal response from EOH.

It gradually became apparent that corruption within EOH was endemic. The crisis came to a head in early 2019 when Microsoft abruptly cancelled a 20-year old reseller contract with the group. The forensic division of the blue-chip law firm ENSafrica was contracted to investigate.

Within months “suspicious transactions” of R1.2-billion had been identified in the group’s public sector subsidiary, EOH Mthombo.

ENSafrica identified suspected tender corruption, the use of politically connected middlemen, inappropriate gifting, sponsorships and donations. There were payments amounting to about R865-million to “subcontractors” where no evidence could be found for any work done — a mechanism for looting. 

In a short affidavit to Zondo last year, Van Coller said that the ENSafrica investigation found “multiple points of failure in governance and oversight mechanisms, inadequate and ineffective controls and inadequate systems thus creating an enabling environment for wrongdoing”.

Van Coller has repeatedly told media and investors that the rot was largely restricted to eight individuals and a small set of companies within the larger EOH holding group. DM


Comments - Please in order to comment.

  • Jane Crankshaw says:

    Ridding the country of racist BEE policies will eliminate the problems of tenderpreneurship and backhanders. Transparency is the key to success in any field including politics and business.

  • David Hill says:

    What about the vat? Capone went down eventually due to his tax returns, where is SARS in this?

  • Gerrie Pretorius Pretorius says:

    “Black Business Council, the … , the Black Business Executive Circle and … .” These seem rather racist. Wonder what would happen if “BLACK” was replaced by “WHITE” or “EUROPEAN”

  • Alley Cat says:

    Aaah how the mighty have fallen. EOH, once the darling of the JSE. I always get suspicious when I see turnover rising exponentially from government contracts shortly after a company opens a BBBEE subsidiary.
    Who were the auditors for EOH? Same ones as Tongaat? Steinhof? Or??

  • Johan Buys says:

    Has EOH gone after Mackay and the estate of de Bruin?

    SARS must have fun watching this too

Please peer review 3 community comments before your comment can be posted


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