Hawks probe Tubular

ALLEGEDLY UNLAWFUL PAYMENTS: R25 MILLION WENT TO THE IDC

As much as R500 million may have been illegally siphoned out of the business.

The Directorate for Priority Crime Investigation has confirmed that it’s investigating complaints against Katenge Tubular Construction directors, who allegedly illegally paid R25 million to the Industrial Development Corporation (IDC) in settlement of a loan owed by an unrelated company within the Tubular group.

This was done without its board’s consent or the knowledge of its 30% BEE partner.

The Tubular group has recently been shrouded in controversy over claims of bribery and corruption related to Eskom and other contracts.

In July, Moneyweb reported that BEE partners in Tubular Holdings subsidiary had applied for provisional liquidation of Tubular Technical Construction (TTC) for defaulting on R24 million settlement payments. The application was brought by Revenue Management and Protection Solutions (RMPS), the 30% BEE partner in Katenge Tubular Construction. The balance is owed by TTC.

The application for TTC’s liquidation, now before the High Court in Pretoria, claims money that should have been paid out as dividends to shareholders was siphoned off to other Tubular group companies, or in settlement of liabilities that had nothing to do with Katenge. The two directors at Katenge were Antonio “Tony” Trindade and Pieter Vorster. Mike Lomas was Tubular group chair.

In 2017, Moneyweb reported on allegations that TCP, another Tubular company controlled by Trindade and Vorster, secured a large contract at Eskom’s Kusile Power Station, by paying bribes of R20 million – and possibly as much as R60 million – into Hlakudi Translation and Interpretation CC’s account, of which then Eskom contract manager France Hlakudi was the sole member.

Asked whether TCP was still on site at Kusile in light of the application for TTC’s provisional liquidation, Eskom said TCP is “performing work as per their contract obligations, which ends on December 10. Eskom has noted with concern the allegations raised relating to bribery. The matter has been handed over to the Special Investigations Unit and a second criminal case has been opened”.

Captain Ndivhuwo Mulamu said investigations into the R25 million paid to the IDC were continuing.

RMPS claimed this money was illegally removed from Katenge’s bank accounts. An interim forensic report indicated as much as R500 million might have been illegally siphoned off. The R25 million was illegally paid to IDC by Katenge in November 2012, but only discovered by the BEE partners in February 2013.

They enquired about dividends and were told no funds were available. They notified TTC of this irregular, unauthorised IDC payment and requested a refund. Some R20 million of the outstanding amount was returned to Katenge on February 13, 2013, but then immediately transferred to other Tubular subsidiaries.

The outstanding R5 million was returned to Katenge on February 27, 2013, but then again fraudulently disbursed to Tubular subsidiaries.

Investigations into R25m paid to IDC are continuing.