NPA adds McKinsey to R398m state capture-linked corruption trial
Image: Gallo Images/Felix Dlangamandla
Multinational management consulting firm McKinsey & Company SA has been charged by the National Prosecuting Authority (NPA) in connection with the R398.4m Transnet fraud case linked to state capture.
The NPA’s Investigating Directorate (ID) on Friday indicted Mckinsey & Co, who is represented by Goitseone Mangope, its employee.
Vigas Sagar, a former principal and employee of the company who is out of the country, was also indicted.
Sagar will stand accused in his personal and representative capacity, while Mangope stands as the current representative of the company.
The Palm Ridge specialised commercial crimes court deferred the matter to October 14 when Mangope will join the other accused. These are:
- former Transnet group chief executives Brian Molefe and Siyabonga Gama;
- former CFO Anoj Singh;
- former CFO Garry Pita;
- ex-treasurer Phetolo Ramosebudi;
- Regiments Capital directors Niven Pillay and Litha Nyhonhya;
- Regiments shareholder Eric Wood;
- Trillian Asset Management current director Daniel Roy (Novum Asset Management); and
- Kuben Moodley, Albatime Pty Ltd owner.
“The former Transnet executives and their co-accused are charged with contravention of the Public Finance Management Act and fraud, while the other accused are charged with fraud, corruption, and money laundering," said ID spokesperson Sindisiwe Seboka.
The group is arraigned on charges stemming from the locomotives transaction advisory tender awarded to the McKinsey-led consortium in 2012, resulting in the procurement of 1,064 locomotives worth more than R54bn.
Regiments Capital was allegedly irregularly onboarded and ended up benefitting from the irregular appointment by Transnet in respect of the contract. The contract value and scope for the services required were later escalated to more than R305m.
“This agreement included, among other services, the sourcing of the China Development Bank loan and the club loan, which were in the amount of $2.5bn, on behalf of Transnet (equivalent to R30bn at the time). The accused also face charges linked to the R93.4m paid to Trillian Asset Management in 2015.
“The senior executives arrested today were granted bail of R50,000 each.”
Wood, who applied for relaxation of his bail conditions on September 7, is expected to return to SA on Friday from the UK and Spain. He was granted permission to visit his daughter in London and his elderly parents in Grand Canaria, one of the Spanish Canary Islands.
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