RIDING THE GRAVY TRAIN
Transnet’s ‘sterling’ financial results are overshadowed by growing allegations, of irregularly awarded locomotive contracts, against its CEO
reports, including one ordered by the Treasury, do cite evidence to support allegations of serious misconduct against Gama when he was head of Transnet’s freight rail division.
The reports say Gama must account for his role in the cost of 1,064 locomotives escalating from R38.6bn to R54.4bn, the inexplicable relocation of two manufacturing facilities from Gauteng to Durban at an “excessive and unjustifiable” cost of R1.2bn, and changed specs on a 2012 tender for 95 locomotives that allowed China South Rail (CSR) to sneak in by the back door after it was disqualified for failing to meet black empowerment criteria.
The allegation that Mckinsey helped Gama draft his MBA assignments, at about the time it three locomotive deals was meant for various Gupta front companies.
The leaked documents show that by January 2015, R1.4bn had already been paid to Gupta-linked entities in the UAE, with another R3bn destined for Tequesta, a company Essa registered in Hong Kong. The Organised Crime & Corruption Reporting Project later reported it had obtained banking records showing that by the end of 2015, CSR had paid another R570m to Tequesta and R750m to another company Essa had set up in Hong Kong, Regiments Asia.
One of the investigation reports, by Mncedisi Ndlovu & Sedumedi Attorneys, recommended that corruption cases be chair Popo Molefe last week claiming it was unlawful to suspend him based on untested preliminary findings leaked selectively to the media. But Popo Molefe said this week the disciplinary process afforded Gama the proper forum to respond. The board would “apply their minds” to the reasons Gama has provided as to why he should not be suspended and “will not discuss the content of the response with the media”, he said.
Gama has declined to comment on the allegations. “Can we allow the internal processes to determine on their own whether I should be suspended or not please,” he said in a text message. “I don’t intend to engage the media on the matter.”