DA to lay criminal charges over Chancellor House deal – Mmusi Maimane

Party leader says there’s prima facie evidence of corruption in Hitachi transaction

DA to lay criminal charges against ANC’s Chancellor House over $6 million Hitachi bribe

Hitachi Ltd, the company which won a R38.5 billion tender to provide Eskom with boilers for the Medupi and Kusile power stations in 2007, admitted last night to have made improper payments to the ANC’s investment company, Chancellor House, to the value of $6 million in the process leading up to the tender being awarded.

Reports late yesterday evening claim that Hitachi Ltd agreed to pay $19 million to settle charges brought against it by the U.S. Securities and Exchange Commission (SEC), which alleged that Hitachi inaccurately recorded improper payments to the ANC via Chancellor House, relating to the contracts to build the two multibillion dollar power plants at Medupi and Kusile.

This quite clearly amounts to prima facie evidence of corruption which saw the ANC illegitimately profit to the tune of $6 million via improper payments disguised as "consulting fees" and other legitimate payments.

According to the SEC’s complaint filed in U.S. District Court for the District of Columbia, Hitachi was aware that Chancellor House was a funding vehicle for the ANC during the bidding process, yet continued to partner with Chancellor House and encouraged the company to use its political influence to help obtain government contracts from Eskom.

Hitachi then paid what it called “success fees” to Chancellor House for its “exertion of influence” during the Eskom tender process in terms of a separate, unsigned side-arrangement. 

The Director of the SEC’s Enforcement Division, Andrew J. Ceresney, was quoted saying the following: 

“Hitachi’s lax internal control environment enabled its subsidiary to pay millions of dollars to a politically-connected front company for the ANC to win contracts with the South African government,”

“Hitachi then unlawfully mischaracterized those payments in its books and records as consulting fees and other legitimate payments.

This is clearly an admission of de facto corruption that implicates the ANC – a party that has infected government at every level with corruption. It is this very corruption which is robbing South Africans of opportunities and the delivery of services, and simply cannot be tolerated

Moreover it is deplorable that yet another ANC corruption scandal has negatively affected millions of South Africans as our load shedding crisis has been hampered by delay after delay at Medupi and Kusile - costing our economy millions of rands. 

The DA will therefore be laying criminal charges against Chancellor House for this unlawful activity under the Prevention of Corrupt Activities Act (POCA).

I will also today write to the Public Protector, Thuli Madonsela, requesting that her office institute an investigation into this matter with immediate effect. 

The DA will ensure that those implicated at Chancellor House are investigated, prosecuted and if found guilty, jailed.

Issued by Graham Charters, Acting spokesperson to the DA Leader, 29 September 2015