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A scheme by employees at Swiss industrial firm ABB to pay bribes for contracts at South Africa’s State-owned power utility nearly fell apart in a dispute over who would share in the spoils, US court filings show.

The filings give a fresh look at corruption at Eskom, the power company plagued by deteriorating finances and regular blackouts. The case, by US prosecutors and regulators, also sheds light on evolving US policy toward companies like ABB that have repeatedly broken the law.

ABB agreed on December 2 to pay a $315-million criminal penalty over bribes to an Eskom official as it sought control and instrumentation contracts at the company’s Kusile coal-fired plant. Two ABB units pleaded guilty and the parent company was charged with violating the Foreign Corrupt Practices Act, the US foreign bribery law. Prosecutors will defer the case and drop it in three years if the company makes promised reforms.

The case “highlights the expanding global network of countries fighting international corruption,” Marshall Miller, a senior Justice Department official, said Tuesday in a speech.

After the settlement, ABB Chief Executive Officer Bjorn Rosengren said the firm has changed.

“We take the Kusile matter very seriously,” Rosengren said in a statement. “ABB has cooperated fully with all authorities and spent considerable time and effort – including launching a new code of conduct, educating employees and implementing an enhanced control system – to prevent something similar from happening again.”

The firm also resolved probes by South Africa and Switzerland, and will do so in Germany. Half the penalty will go to South Africa. ABB is paying $4.3-million to Switzerland, where the firm acknowledged not taking “all necessary and reasonable” steps to prevent the bribery. On December 3, the Securities and Exchange Commission issued an order against ABB that raised the overall cost to the company, after other credits, to $327-million, the firm said.

‘Capture Team’

To get its US deferred-prosecution deal, ABB admitted that between 2014 and 2017, it bribed a South African official “to improperly influence the decisions of Eskom, and to secure an improper advantage” to obtain business. It formed a “capture team” to seek Kusile contracts and hired unqualified subcontractors to receive payments intended as bribes for the official.

Needing a “sales shark,” the capture team appointed a German employee with “a reputation for non-transparency about how he went about interactions with clients,” according to the SEC order.

The Eskom official agreed to award a $160-million contract to ABB if it hired an engineering firm, which got a $7.2-million subcontract. The official demanded immediate payment of his cut of $720 000. But the bribe scheme “nearly came undone” when the chairperson of the engineering firm “refused to share the spoils” with the official due to an apparent falling out, the SEC said.

The capture team leader tried to broker a peace, arranging a face-to-face meeting, but it failed. Instead, the leader brought in another engineering firm, run by someone tied to a close friend of the official. That firm, which initially didn’t clear ABB’s qualification process, was ultimately paid $37-million, “much of which was intended as bribes” for the official, the SEC said.

$104-Million Repayment

ABB is one of several international companies found to have engaged in years of corruption at Eskom and other South African State-owned companies during the presidency of Jacob Zuma, which ended in 2018. ABB agreed in 2020 to repay $104-million it was paid in connection with Kusile. In July, two former ABB employees and their wives were arrested in South Africa for corruption linked to $29.4-million of contracts.

Eskom, in response to questions about the ABB criminal and regulatory cases in the US, said in an email: “Kindly note that the civil matter is closed from an Eskom perspective.”

In the US, ABB is a repeat offender, resolving criminal cases in 2010 ...

The Department of Justice and Correctional Services has urged members of the public to participate in the legislative development process that seeks to decriminalise sex work, by making inputs to improve the Criminal Law (Sexual Offences and Related Matters) Amendment Bill of 2022.

Justice and Correctional Services Minister Ronald Lamola gave a media briefing on Friday where he noted that the question of how the South African legal system should respond to sex work and related activities had been the subject of considerable debate in the country.

The Bill does not decriminalise and regulate the industry all at once and it deals with decriminalisation only, with regulation to follow at a later stage.

“It was thought to be important to deal with the decriminalisation first, so as to ensure that sex workers are no longer criminally charged. This will mean greater protection for sex workers. Decriminalisation will de-stigmatise sex work and enable access to basic services and protection by law enforcement agencies. Existing laws prohibiting children from selling sex and trafficking for sexual purposes, remain in force,” explained Lamola.

He said sex work was driven by a complex intersection of social and economic factors in which poverty, unemployment and inequality were key drivers.

“Within the current South African context the debate around sex work has been complicated by high levels of unemployment, crippling poverty, burgeoning numbers of migrant and illegal foreign job seekers, high levels of sexual violence against women, the HIV/Aids epidemic, drug/substance abuse and targeted exploitation of women engaging in sex work by third parties, authorities and buyers,” he added.

The Bill is expected to nullify the Sexual Offences Act (previously Immorality Act), 1957 (Act 23 of 1957).

The proposals of the Bill respond to the list of interventions proposed in the National Strategic Plan (NSP) on Gender-Based Violence and Femicide (GBVF) which enjoins the criminal justice system to provide protection, safety and justice for survivors of GBV, and to effectively hold perpetrators accountable for their actions.

The Bill will also cancel Section 11 of the Criminal Law (Sexual Offences and Related Matters) Amendment Act, 2007 (Act 32 of 2007) to decriminalise the sale and purchase of adult sexual services.

He went on to say municipal bylaws would still be able to dictate where solicitation in public spaces may or may not take place.

Lamola said this was similar to the prohibition on the location of taverns and shebeens, where restrictions can be imposed to prohibit trade in residential neighbourhoods, near schools and/or religious buildings.

The Bill further seeks to ensure that South Africa complies with its obligations conferred in terms of International Instruments.

Lamola explained that in line with the NSP on GBVF, the department hoped that decriminalisation would minimise human rights violations against sex workers.

“It would also mean better access to health care and reproductive health services for sex workers, as well as compliance with health and safety and labour legislation. It would also afford better protection for sex workers, better working conditions and less discrimination and stigma,” he said.

The department said all submissions would be considered and the Bill would be taken back to Cabinet to request Cabinet’s approval to introduce the Bill to Parliament.

Comments on the Bill must be submitted to the Chief Directorate: Legislative Development on or before January 31, 2023.

Comments can be sent via post: The Director-General: Justice and Constitutional Development, Private Bag X 81, Pretoria, 0001, Marked for the attention of Tsietsi Sebelemetja; or via email: [email protected]; or via fax: 012 406 4632.

Further information can be obtained from the Chief Directorate: Legislative Development at 012 406 4769/4753.

The African National Congress's (ANC's) electoral committee told Bathabile Dlamini she was entitled to appeal her disqualification from contesting for a position on the national executive committee (NEC), despite her threats to sue.

The former president of the ANC Women's League's legal representative, Boingotlo Maroane, of Tim Sukazi Incorporated, stated in a letter that Dlamini disputed her exclusion from contesting, and she "intends to institute legal proceedings" against the committee.

The legal letter directed at the committee, which News24 has seen, is dated 8 December.

On Wednesday, Dlamini was informed that she was eliminated from contesting a position in the NEC following a vetting process because of her conviction for perjury.

She was one of the frontrunners, and had 856 nominations for her return to the NEC.

The former minister of social development was found guilty of perjury and sentenced to four years' in prison or a fine of R200 000.

ANC electoral rules adopted by the NEC ahead of the nomination process excluded members, who had been found guilty and convicted of a prison sentence, from contesting for a leadership position.

Dlamini, who is an outgoing NEC member, was nominated overwhelmingly, despite her conviction and sentence.

The ANC electoral committee wrote to Dlamini's lawyers, saying she could appeal her exclusion as the rules allowed.

"We wish to humbly remind your client, Bathabile Dlamini, that she has a right to appeal the outcome of the vetting processes in line with rules approved by the NEC. The electoral committee shall consider the relevant representation for appeal should your client elect to exhaust internal remedies available to all comrades with disputes.

"We believe in strengthening internal democracy in the ANC," the committee stated in the letter to Dlamini.

It is unclear whether Dlamini intends to appeal directly to the committee, which is chaired by former president Kgalema Motlanthe.

She has posted on various social media platforms about her elimination, and what she viewed as an injustice.

The ANC elective conference starts on 16 December at Nasrec in Johannesburg.

South African consumer confidence recovered to its strongest level in two years in the fourth quarter as households anticipated better employment prospects and an improvement in their finances.

A quarterly index measuring sentiment rose to -8 from -20 in the previous three-month period, FirstRand Ltd’s First National Bank said in a statement on Thursday. That’s the strongest level since the final quarter of 2019, before the coronavirus pandemic struck.

The index has been negative for 14 straight quarters, the longest stretch since the series began in 1982, signalling depressed consumer sentiment.

The scope of the rebound relative to the third quarter is a surprise given sustained high inflation, rapidly rising interest rates, frequent power cuts and the generally bleak outlook for global economic growth, FNB chief economist Mamello Matikinca-Ngwenya said. The rebound points to a level of resilience among South African consumers, she said.

The household financial outlook sub-index was the main driver of the improvement, jumping 15 index points to reach 13 during the fourth quarter — a similar reading to the 2021 festive season.

“Young people, aged between 16 and 34 years, have turned much more optimistic about their financial prospects compared to the older generation,” FNB said, pointing to increased job creation among that age bracket.

The official jobless rate decreased to 32.9% in the three months through September from 33.9% in the previous quarter, while the youth unemployment rate fell to 44% from 46% in the same period in 2021. South Africa has also introduced various public work programmes for youth.

“An uptick in employment growth, particularly in the now fast-recovering services sector, and substantially lower petrol prices since the third quarter no doubt bolstered consumer sentiment in the run-up to the festive season,” Matikinca-Ngwenya said.

With the African National Congress’s (ANC’s) fifty-fifth National Elective Conference taking place in a week, National Executive Committee (NEC) nominee Sihle Zikala is calling for unity, a mantra from the party’s January 8th statement, and which forms part of the ANC’s renewal strategy.

Speaking exclusively to Polity, Zikalala, who tops the list of ANC NEC nominations, said factionalism is weakening the party.

“We admit that the ANC as an organisation is going through challenges, however, the spirit of factionalism is not the answer to our problems. There must be efforts to uproot factionalism because it is the main source that denies the movement the capacity to work coherently and focus on the primary tasks of the revolution,” he said.

Despite the many challenges currently plaguing the ANC, Zikalala has full confidence in the party, urging “a pure process of renewal” for the future success of the ANC.

“I believe we need to objectively go thorough the renewal programme in a way that is not selective. What we need to do as an organisation is to stop fighting each other and start serving communities. The December Conference should be considered as a second chance to make our wrong right. It is also a proper time to reflect on the progress that we have made since the beginning of the party,” he said.

He wants to see the high levels of poverty and the high cost of living addressed, which, once tackled, he believes will ensure that the party becomes relevant to the people on the ground.

“The ANC should exist to unite, serve and lead the people of South Africa, particularly in the struggle against social ills, instead of individuals fighting for personal power,” he said.

The party needed to lead by example and be united for the country to be united, he added.

“The organisation will not be able to unite the people of the country if it is so divided, that is why we are saying that our unity should be measured around the programme of the revolution,” said Zikalala.

His concern ahead of the 2024 elections is disillusionment with the party. The ANC has seen its support drop in recent years. However, Zikalala wants people to remember the party’s success over the years.

He took a stance on corruption and said those who brought the ANC into disrepute and whose conduct was beyond reproach should not be tolerated.

“This means that we should fight all corruption practices and restore the best value of serving people. We must refuse to see the institutions of our hard-won freedom being perverted or corrupted to fight factional battles. Institutions of government must be allowed to work transparently and objectively with no interference,” Zikalala said.

The Constitutional Court has unanimously dismissed Jacob Zuma’s last attempt to force the removal of prosecutor Billy Downer through a so-called “special plea” process, which the former president contended would entitle him to an acquittal.

This means, conceivably, that Zuma’s long-awaited arms deal case could actually go ahead – unless he brings another legal challenge to block the trial from going ahead.

And that seems likely, as he is currently seeking to privately prosecute Downer and this writer for alleged violations of the National Prosecuting Authority Act in a separate case linked to News24’s publication of court papers containing a sick note from one of the former president’s military doctors.

The Limpopo Department of Economic Development, Environment and Tourism has added its voice to the Phala Phala scandal.

According to it, information on the sale of buffaloes from President Cyril Ramaphosa's Phala Phala farm, purportedly from its officials, may have been released to "advance their political or ulterior motives".

SABC programme Unfiltered reported that the department had not received an application from Phala Phala Wildlife or Ntaba Nyoni CC to export 20 buffaloes to Sudan. A document, also purportedly from the department, was posted on social media.

The buffaloes were those that Sudanese businessman Hazim Mustafa reportedly purchased for the equivalent of around R10-million in December 2019. It's alleged that he paid in cash in US dollars.

The currency, which was hidden in a sofa, was stolen around 45 days later when burglars broke into the farm.

The matter came to light when former spy boss Arthur Fraser opened a case with the police.

A Section 89 panel, led by former chief justice Sandile Ngcobo, probed the matter on Parliament's instruction and found prima facie evidence. It concluded that there was a case to answer.

Ramaphosa could face an impeachment inquiry. He has since applied to the Constitutional Court to challenge the findings.

Political motives

In a statement on Wednesday, the Limpopo department attempted to distance itself from the claims broadcast on the SABC programme.

"The Limpopo Department of Economic Development, Environment and Tourism has noted with great concern an unknown, unapproved and informal communiqué which has unfortunately brought about coverage excitement related to Phala Phala Wildlife and its auctioning of game," department spokesperson Zaid Kalla said in the statement.

"The department has since taken a firm position not to respond or entertain any queries related to the circulating document," he added.

Kalla added that an internal investigation had been launched to uncover who the responsible officials are.

"It is the department's understanding that matters on Phala Phala are sub judice. It is, therefore, false that the Limpopo provincial government has issued a communiqué regarding the matter."

Kalla claimed that the information was a nefarious stunt by "some of its officials who are hell-bent to use the department to advance their political or ulterior motives".

"The department has operational systems in place on authorised personnel who are entrusted with the task of speaking on its behalf."

Former South African Revenue Service deputy commissioner Ivan Pillay has said that the African National Congress (ANC) is no longer seen as a reliable organisation for realising the aspirations of millions who suffered under apartheid.

Pillay was speaking at the annual Helen Suzman memorial lecture in Johannesburg, where he said the party was no longer closely identified as such by the poor and the marginalised.

“There is distrust of the ANC, even among its followers, who, although they may vote for the organisation, do not believe or trust its promises,” he said.

He added that there was no other party that had won substantial trust, yet.

He highlighted that surveys showed that the strongest two alternatives - the Democratic Alliance and Economic Freedom Fighters – also evoke significant levels of distrust.

“While other electoral alternatives have emerged, there is no evidence of a party that can win an election outright or obtain more votes than the ANC, or establish a stable coalition government. There is no party with a plan to address inequality, hunger, unemployment and the breakdown of basic services. There is no party that can be relied on to provide the bare minimum of conditions for a decent life for all,” he explained.

He said there was a crisis of representation which primarily effected the ANC, as it was no longer regarded as a “credible, trusted and honourable force.”

Pillay said the distrust and cynicism towards the ANC extended to the country’s institutions of representative democracy such as Parliament, provincial legislatures and municipalities, which he said had weakened oversight functions.

Politicians have been shown to place more weight on obligations to their political parties than to citizens, he said, and added that communities were often left to fend for themselves.

He said there was currently no viable pathway for resolving problems through government institutions, which were hamstrung by a low quality of democracy.

“The crisis worsens as voters stay away or do not even register to vote. And there are additional potentially troubling signs, especially the withdrawal of the youth from the political landscape, and the fact that unemployment is particularly high amongst the youth, even amongst those with matric or tertiary qualifications,” he explained.

He believes there is an absence of leadership from business, labour and government.

STATE CORRUPTION

Meanwhile, Pillay highlighted that State systems seemed open to manipulation at multiple points, resulting in overpricing of inputs and supplies, payments for non-existent supplies, poor-quality outputs and sometimes no service delivery to citizens.

He said many State institutions were no longer appropriately designed, capacitated and managed.

Professionals were driven out by senior politicians and public servants who were and are dismissive of the need for deep technical knowledge of the core business and of operations management, he explained, while noting that State institutions hired and promoted “generalists who report to other generalists”.

“Many of our managers and leaders are not systemic. We are mainly event- and transaction-driven interventionists. By continuous non-systemic actions and instructions, we invariably break existing systems. There is little analysis, generation of options, objective selection of these options, nor sufficient design and realistic planning. We usually just make announcements. When that does not succeed – and it often does not, because we have broken the delivery mechanisms – we make even more announcements. From land distribution to fighting crime, the more we fail, the louder and more strident we become,” he added.

He highlighted that such managers and leaders had a ripple effect on each layer of management, causing subordinate managers to operate at several levels below what was required.

That behaviour over a prolonged period causes all levels of authority to become transactional.

The result is fragmentation and ...

After spending 28 years in prison for the assassination of South African Communist Party (SACP) and African National Congress leader Chris Hani, Janusz Walus was released from prison on Wednesday, as ordered by the Constitutional Court.

The Ministry of Justice and Correctional Services confirmed that Walus had been placed on parole under strict conditions.

Walus was due to be paroled on 1 December, however, his release was delayed after he was stabbed in Kgosi Mampuru prison in Tshwane where he had been serving his life sentence.

News24 previously reported that the 69-year-old was queuing for dinner when he was stabbed in his upper body with a sharp object.

The man accused of stabbing him is serving a life sentence for murder and attempted murder.

"Offender Walus was only discharged from hospital today (07 December 2022) as he had been receiving treatment after he was involved in a stabbing incident," the ministry said.

Walus was sentenced to death for the murder of Hani in 1993, but the sentence was later commuted to life imprisonment after the death penalty was abolished.

After his death sentence was commuted, he became eligible for parole in 2005, and started applying to be released on parole from 2011. However, he was denied multiple times over the years.

His bid for parole was eventually successful after his legal challenge ended up in the apex court, which ordered that he be released.

Constitutional rights

In the statement, the ministry was at pains to explain his release.

"There is no question that offender Walus is a polarising figure in our budding constitutional democracy, and that his release has understandably reopened wounds among some in society, especially the family of the late struggle icon Chris Hani.

"Offender Walus’ actions sought to derail the democratic project at its most critical, formative stage, when the choice of either setting the country on a sustainable path of peace, democracy and reconciliation on the one hand, or chaos, civil strife and blood-letting on the other, was constantly one bad decision away.

"His killing of Hani was unqualifiedly among those actions that sought to condemn the country to the latter fate, had it not been for the inspired leadership of our nation’s founders and the resolve of the people of South Africa."

The ministry added that previous decisions to deny Walus parole were not made to avenge Hani, but had always been within the context of giving effect to the interests of justice, from the perspective of what the sentencing court had sought to achieve.

The Constitutional Court judgment removed the decision-making power from Justice Minister Ronald Lamola in this instance.

The ministry said courts, on previous occasions, had said the Constitution was located in a history involving a transition from "a society based on division, injustice and exclusion from the democratic process, to one which respects the dignity of all citizens and includes all in the process of governance".

"As such, the process of interpreting the Constitution must recognise the context in which we find ourselves and the Constitution's goal of a society based on democratic values, social justice and fundamental human rights.

"This spirit of transition and transformation characterises the constitutional enterprise as a whole.

'Uphold the rights of everybody on an equal basis'

"Our parole system is not a wanton license for unaccountability and impunity. Neither does it nullify the original verdict and sentence imposed by the courts. Parole is an acknowledged part of our correctional system," it said, adding:

It has proved to be a vital part of reformative treatment for the paroled person who is treated by moral suasion.

The ministry added that this was consistent with the law and that everyone had the right not to be deprived of freedom arbitrarily or without just cause, and that sentenced offenders had the right to benefit from the least severe of the prescribed punishments.

"It is our long-standing v...

Disgruntled African National Congress (ANC) members are disputing the list of 200 candidates who are up for election as national executive committee (NEC) members.

ANC electoral committee chairperson Kgalema Motlanthe released the list last week.

The bone of contention is that it takes into account in gender parity and not who received the most nominations.

The disgruntled party members are challenging this.

They say that, in line with the rules of the electoral committee, Motlanthe is supposed to release the list of those who received the most nominations and allow delegates to vote for them at the national elective conference.

If there is no gender parity in the 80-member NEC, changes can be made at the conference. The unhappy party members say the changes compromised youthful members who had made it onto the list.

They are calling on the electoral committee to make public the unchanged nomination data.

Their objection was filed after a petition to challenge the list was signed by almost 100 ANC members.

Leading the charge for the complainants is Isaac Mashaba, a member from Ward 30 Sebokeng, Gauteng.

Speaking to News24 on Tuesday morning, Mashaba said the list published on 1 December "failed to meet the minimum requirements in that it failed to tabulate the total number of branch and provincial nominations received by each candidate".

He argued that what the electoral committee published was a list that had already factored in gender parity.

Mashaba said the disgruntled members believe the ANC's electoral process will not be free and fair.

He was concerned that "we are using an electoral college system that is easily manipulated through influencing a core of influential people, like branch, regional and provincial secretaries who manage the membership and deployment system".

Mashaba added that it made the ANC's internal democratic process vulnerable to corruption by businesses, internal factions and outside interests.

Responding to the group's concerns, ANC electoral committee secretary Chief Livhuwani Matsila, acknowledged via email the notice of objection to the electoral committee.

He said it also wished "to advise that the electoral committee is in the process of finalising the acceptance/decline of nominations and vetting of candidates".

Matsila said the electoral committee "shall, within this week, furnish the provincial offices with the final consolidated nominations for their records.

"We, therefore, request that you wait for that process of publishing the full outcomes of the nomination process to be completed so that you can access the information required," he said.

The aggrieved members also objected to the electoral committee having the last say on objections that raised over the list.

Mashaba said that "in terms of Rule 12.2.3 of the constitution, the NEC has an obligation to supervise and direct the work of the ANC and all its organs."

"With this background in mind, it is noteworthy that the powers mentioned above and obligations of the NEC, among other rules of similar value, are constitutionally enshrined, as such cannot be delegated, including to the electoral committee," Mashaba said.

In response, Matsila said: "We have noted your concerns around the dispute resolution processes, and we shall furnish you with a substantive response as soon as possible."