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Mosilo Mothepu, former employee of Regiments Capital and CEO of Trillian Financial Advisory. (Photo: Gallo Images / Papi Morake)
Former Eskom executives Anoj Singh and Matshela Koko were instrumental in illegally outsourcing the work to McKinsey and Trillian, former Trillian CEO Mosilo Mothepu told the State Capture Commission.
Former Regiments Capital employee and Trillian Financial Advisory CEO Mosilo Mothepu told the State Capture Commission how inexperienced teams from the Regiments and McKinsey worked for Eskom that the energy giant had the ability to perform internally, a ploy. Capture of the State copied and pasted from the Regiments. ‘previous work at Transnet.
McKinsey and Trillian received 1.6 billion rand for their work at Eskom. McKinsey has reimbursed its share of R1 billion, while a court ordered Trillian to reimburse the power company for its R600 million. Eskom has tried to liquidate the company to recover the funds.
Mothepu returned to the Regiments in mid-2015 after working for the company years before. When Gupta associates Eric Wood and Salim Essa bought Regiments and renamed it Trillian, she was named CEO, a position she held for about three months before leaving the company in June 2016.
He described the range of tasks that McKinsey and the Regiments, later Trillian, worked on, most of which they had no experience to perform.
“We were pushed down the throats of the Eskom officials and of course there was a lot of resistance. In my observation, I say that part of State Capture, essentially, is simply appointing consultants unnecessarily and diverting very high fees while the internal team has the capacity and experience to carry them out, ”Mothepu said.
“A total of 1.6 billion rand was paid, which was completely unnecessary because Eskom had and still has the capacity to do so.”
Trillian was paid after an agreement was reached with Eskom despite not having a contract with the power supplier and allegedly having agreed to work only for a commission from the costs that it saved Eskom.
Noting the payments the regiments received from Transnet and other state-owned companies, Mothepu described the strategy as “cut and paste everywhere”. The “business partners” Kuben Moodley and Salim Essa, widely implicated in allegations of corruption in connection with the Gupta family, took over most of the regiments’ fees.
“They are the ones who essentially got these contracts from state-owned companies under the umbrella of the Department of Public Enterprises,” Mothepu said.
The regiments began working with Eskom after Brian Molefe and Anoj Singh were seconded from Transnet, as CEO and CFO respectively, in mid-2015. Mothepu first met with Singh to discuss what they called “Project Pandora” on the July 8, 2015.
McKinsey and the regiments were helping Singh work out a plan for Eskom’s finances, and Mothepu got the impression that the McKinsey staff and regiments had known him before.
Eskom did not announce until July 16, 2015 that Singh would be appointed to the company as interim CFO on August 1 for a period of six months. On September 25, 2015, the then Minister of Public Enterprises, Lynne Brown, announced that Singh and Molefe would be appointed to Eskom on a permanent basis.
“I had a feeling that Anoj knew he would eventually be made permanent,” Mothepu said.
She described how she and Wood met and worked with Singh, former Eskom business and technology executive Matshela Koko, and other Eskom leaders who expanded the list of tasks they wanted McKinsey and the Regiments to perform.
He said that Koko had told Parliament’s Eskom inquiry that he was not involved in Trillian’s appointment, “but the truth is, as you have seen in my testimony today, he and Mr. Singh were central figures in the McKinsey and Trillian negotiation; in addition, they added more initiatives ”.
Trillian was subject to a risk review, conducted in the US, when he wanted to replace the Regiments as McKinsey’s partner at Eskom. McKinsey was unable to sign a contract with Trillian as Essa, which owned 60% of the company, was considered a politically exposed person.
Mothepu said Singh was unhappy with McKinsey and asked the company to give Trillian time to establish a footprint.
“It was quite interesting that Mr. Singh was basically begging on Trillian’s behalf for McKinsey to give them an extension.”
Mothepu has testified Previously, Wood had prior knowledge of former President Jacob Zuma’s removal from office in December 2015 of Nhlanhla Nene as Finance Minister and how the Regiments would benefit. DM
