Eskom initiates legal actions against Deloitte

The investigations and inquiries have linked the wealthy Gupta family, former President Jacob Zuma to the scandal
Eskom initiates legal actions against Deloitte

South Africa’s cash-strapped state power firm, Eskom has filed court papers in a bid to recover R207 million ($14 million) in connection with contracts it alleged were improperly awarded to Deloitte Consulting in 2016.

Eskom, drowning in debt of over 450 billion rand and reliant on government bailouts to keep the lights on, is at the centre of a judicial inquiry into corruption at state entities, in addition to several other probes into mismanagement at the company. 

READ: South African electricity company Eskom suffers losses

On Monday, the power firm’s chief executive and chairman, Jabu Mabuza said in a statement that it was going after Deloitte for R207 million linked to contracts it was awarded by previous Eskom executives in 2016. 

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“Information before us, shows that Deloitte engaged in activities that were unfair, inequitable, non-transparent and uncompetitive using off-the-record briefings with Eskom officials to submit proposals, and were granted contracts even though their pricing was way above their competitors,” says Mabuza. 

READ: South African electricity company, Eskom gets R59 billion bailout

Mabuza said Eskom was asking the court to declare the activities relating to a batch of tenders “unlawful and unconstitutional, to set aside the awards, and for Deloitte to pay back the amounts paid to them”. 

The investigations and inquiries were triggered by the 2016 leak of a trove of documents detailing relations between the wealthy Gupta family, former President Jacob Zuma, and deals struck with state firms like Eskom, as well a number of big companies including multinationals like McKinsey and Germany’s SAP. 

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The Gupta family and Zuma have denied the allegations.

READ: South Africa’s Eskom suspends power cuts

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