The intelligence report shown to Business Day at the first meeting by a source involved in a privately funded investigation of crime and corruption at Eskom, is just more than an inch thick. But if the information it contains can all be backed up with solid evidence the implications would reach far deeper into the machinations at the most maligned state-owned institution than the Zondo commission ever did.
The report is one of many prepared as part of a private investigation launched last year by André de Ruyter, who was booted out as Eskom CEO last week, a month before he was due to leave the post after he resigned in December.
Last week, in a now much-publicised interview aired on eNCA, De Ruyter gave SA and the world a first look into the investigation that has, he said, so far identified four crime cartels, all with suspected high-placed political connections, operating in Mpumalanga.
De Ruyter’s account, as well as details revealed in other media reports, confirmed what has been shared with Business Day by a high-placed contact involved in the investigation.
The main task of the intelligence operation, run by former state intelligence operatives, is straightforward, the source told Business Day.
The private investigators and their network of informants are trying to figure out how the corruption happens, who sits at the top pulling the levers that set the corrupt activities in motion, how the corruption unfolds, and who ultimately benefits.
De Ruyter said in the eNCA interview he believes as much as R1bn is being stolen from Eskom every month. He also spoke of his suspicions that “a high-level politician” was involved in some of the corruption taking place at Eskom and that he had shared his suspicions with a minister.
But the intelligence reports obtained through this operation, as is relayed in documents seen by Business Day, suggest that there are two members of cabinet with links to at least four cartels. Their names and also those of the suspected leaders of the cartels, are known to Business Day, but cannot be revealed at this stage for legal reasons.
It is impossible to conclude that some of the corruption and criminal activity at Eskom and in its supply chains is not the work of individuals exploiting the
utility solely for personal gain.
However, there is also much reason to suspect that sabotage, tender fraud, and other corrupt activities are being done in an organised way by the four main cartels. The names of these cartels, as revealed to Business Day, are the Legendaries (thought to be particularly involved at Tutuka power station), the Presidential Cartel, the Chief Cartel and the Mesh-Kings.
The source said that investigators were following up on the alleged link between one or more of the cartels and a close family member of one of the two implicated cabinet members.
In one of the operation’s reports seen by Business Day, investigators recount intelligence received that ranges from the fairly innocuous, such as the disruption of a meeting held by a local business forum in Mpumalanga, to the far more sinister. There are accounts of hit squads paid by the cartels to
carry out assassinations, as well as of a complicated plot to increase load-shedding with the aim of discrediting President Cyril Ramaphosa in the run-up to the ANC’s national elective conference in December 2022.
These events, we know now, played out differently, with Ramaphosa retaining his position at the top of the ANC, and despite the storm that was raging around the president at the time because of the handling of a large amount of US dollars at his Phala-Phala game farm.
Rigged tenders
Intelligence received from one source, quoted in the report regarding a power station in Mpumalanga, alleges that Eskom managers, in cahoots with the cartels, appoint inexperienced workers who will then continue running a part of the system that is at risk of failure until it breaks down because they do not know better. Whereas a few minor repairs would have prevented the system from failing, once it has broken down the whole or part of the system has to be replaced at a much higher cost. This breakdown then sets in motion a procurement process that awards contracts to companies owned by cartel members or their associates or family members.
Apart from the rigging of tender processes, much of the crime and corruption can be linked to Eskom’s coal supply chain. Business Day has previously reported how coal loads destined for power stations are taken from a certified stockpile, but en route to a power station, the delivery is diverted to a “black site” where the load is replaced by low-quality discarded coal. The criminals then proceed to sell the high-grade coal stolen from Eskom for their own gain.
The private investigation was never funded through Eskom but by private donors and there is no reason why it would not continue now that De Ruyter is no longer at the utility, our source said.
What the operation has gathered so far is a body of intelligence, not evidence. But it paints a compelling picture of high-level political involvement in the co-ordination and planning of criminal acts on a regional and even national level.
Recent developments may also see some of the intelligence compiled through the private operation taken up for further investigation by members of the SA Police Service that have been directed to focus on the allegations of corruption at Eskom, the source said.
After De Ruyter’s disclosures last week, the ANC threatened legal action and criminal charges if he failed to provide proof of what he said in the interview.
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