Shock for Eskom fraudster as magistrate throws switch on 20-year sentence

Former Eskom director Dawid Malherbe will exchange his designer suits for orange prison garb.

Bellville Commercial Crimes Court handed the businessman a 20-year prison sentence on Friday for defrauding the parastatal of more than R10-million. Malherbe and his company were convicted earlier this year of fraud and money laundering.

After living it up on the lap of luxury‚ the 63-year-old with a greying beard is struggling to keep even a house and car after being hit with a confiscation order by the Asset Forfeiture Unit.

The fraudster was the manager of PN Energy Services (PNES)‚ an Eskom subsidiary that built and maintained electrical infrastructure in the Cape Town township of Khayelitsha. PNES was incorporated into the parastatal in 2008.

Malherbe resigned from Eskom in 2009 and subsequently procured two contracts for his company‚ Energy Utility Services‚ which received payments of up to R65-million between 2009 and 2010. He made a quick profit of R10.2-million.

Handing down sentence‚ magistrate Sabrina Sonnenberg‚ said Malherbe had not shown remorse.

“Eskom is a huge public entity that provides an essential service that should be protected from crimes committed by its own employees‚” Sonnenberg said.

“The court cannot allow criminals to pay fines with the proceeds of their criminal activities. A correctional sentence will only suit [Malherbe] and his loved ones. The just and suitable sentence is that of imprisonment.”

Malherbe was sentenced to 20 years in prison‚ five of which were suspended for five years. His counsel lodged an application for leave to appeal against conviction and sentence.

The businessman was also convicted of misrepresenting his company’s BEE status in order to secure the contracts‚ “indicating that there was external black empowerment and/or (the company) was 45% black owned”‚ the charge sheet said.

Malherbe failed to disclose his conflict of interest when he bid for the contracts‚ misused sensitive information for his benefit and did not recuse himself from deliberations around PNES.

He was arrested in 2013 after Eskom alerted the Hawks to suspected irregularities. A Hawks investigation found that Malherbe transferred money between accounts to “disguise or conceal” its origin.

He paid R2.5-million via a company for a property at Harbour Island in Gordon’s Bay and R1.3-million for a home in Bellville. He transferred R444 480 from his private bank account into the bond of another beachfront property in Gordon’s Bay. Malherbe also bought a Toyota Prado for R670 000‚ an Echo Kavango off-road trailer for R189 250 and transferred R390 160 from his private account into his wife’s account.