RID­ING THE GRAVY TRAIN

Transnet’s ‘ster­ling’ fi­nan­cial re­sults are over­shad­owed by grow­ing al­le­ga­tions, of ir­reg­u­larly awarded lo­co­mo­tive con­tracts, against its CEO

Financial Mail - - FEATURE -

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.”

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