Koko, wife and stepdaughter arrested over Kusile power station contract

Read More

Former Eskom chief executive Matshela Koko was arrested on Thursday morning, along with five other people including his wife and stepdaughter, becoming the first former top executive of the power utility to be brought before court on state capture charges.

Koko, his spouse Mosima and stepdaughter Koketso Choma and the remaining accused, appeared in the Mpumalanga magistrate’s court.

The Investigating Directorate said they were arrested “at the crack of dawn” at different locations in Gauteng and Mpumalanga.

They face charges of corruption, fraud and money-laundering stemming from irregular contracts worth R2-billion granted during the construction of the Kusile power plant.

In 2015, Eskom entered into a contract with Swiss engineering firm Asea Brown Boveri, who then signed up Impulse Trading as a subcontractor, in a deal worth R800-million. Choma served as a director of Impulse, and allegedly earned R30-million from the deal.

It was alleged that Koko promised the firm further contracts worth more than R6-billion should it enter into an arrangement with Impulse.

Asea Brown Boveri in 2020 concluded a settlement agreement with Eskom to refund R1.56-billion. But in September, the company said it would put aside R6-billion as a provision to cover costs that may arise as a result of ongoing investigations into contracts linked to Kusile. 

Koko was implicated in state capture in the Zondo report, with Chief Justice Raymond Zondo urging that he and former Eskom chief financial officer Anoj Singh face criminal charges for paving the way for the Gupta family to purchase Optimum coal mine using Eskom money.

The pair, Zondo wrote, led Eskom to believe that the transactions were for coal when they knew the money would be used by the Guptas to cover the shortfall they needed to acquire Optimum Coal Mine.

Koko has for years denied any wrongdoing, including on the Asea Brown Boveri deal. In his testimony to the commission, Koko insisted that he was ignorant of the fact that he was exchanging confidential company information with key Gupta associate Salim Essa.

Their correspondence included an email, in December 2015, that set out the favourable terms on which Eskom was to enter into a R1.68-billion prepayment arrangement with Tegeta Exploration for coal.

Singh and former Eskom chief executive Brian Molefe have been charged with corruption that occurred during their term at Transnet, but no senior figures have yet been charged in relation to the Tegeta deal.