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Transnet and SIU ask high court to cancel 1,064 locomotive contracts, scene of the Guptas’ greatest heist

Former Transnet acting chief financial officer Anoj Singh. (Photo: Gallo Images / Foto24 / Lerato Maduna) | Atul Gupta. (Photo: Gallo Images / Financial Mail / Robert Tshabalala) | Former Eskom CEO Brian Molefe. (Photo: Gallo Images / City Press / Lucky Nxumalo)

Finally, Transnet and the Special Investigating Unit ask the high court to overturn R54bn worth of locomotive contracts – the most expensive known to have been affected by State Capture.

Transnet and the Special Investigating Unit (SIU) have finally asked the high court to cancel the state logistics company’s contracts for the procurement of 1,064 locomotives – the scene of the Guptas’ greatest known looting.

Transnet, then headed by chief executive Brian Molefe and chief financial officer Anoj Singh, both Gupta associates, awarded the contracts, worth some R54-billion, to original equipment manufacturers General Electric, Bombardier Transportation, China South Rail (CSR) and China North Rail (CNR) in 2014.

Transnet and the SIU said in a statement that their papers, filed on Tuesday 9 March 2021, show that the procurement “was based on a flawed market demand strategy… and that the laws, government instructions and Transnet policy were deliberately ignored to make the tender awards, conclude the contracts and effect payment to some of the [manufacturers].”

They said the manufacturers were “not entitled to benefit from locomotive supply agreements that were awarded to them in an irregular and illegal manner, and particularly not when the [manufacturers] conducted themselves in the manner that CSR and CNR did”.

amaBhungane and Scorpio #GuptaLeaks: Guptas and associates score R5.3bn in locomotives kickbacks

Echoing amaBhungane and its #GuptaLeaks partners’ exposés since 2017, Transnet and the SIU referred to kickback agreements concluded with Hong Kong-based Gupta fronts Regiments Asia and Tequesta Group. 

“It is argued that given the nature of the kickback agreements concluded by the parent company of CSR and CNR, they cannot claim to be innocent.”

Our reporting has shown that the two Chinese manufacturers concluded contracts to pay the Guptas and their associates R9-billion in kickbacks on R42-billion of contracts from Transnet. These spanned the lion’s share of the 1,064 procurement and further locomotive orders. By late 2016, Gupta fronts had already received R3.7-billion.

CSR and CNR have since merged to form CRRC Corporation, the world’s largest rail equipment supplier. It is listed in Hong Kong and Shanghai with the Chinese state as a controlling shareholder.

Transnet and the SIU also claimed General Electric and Bombardier could not “claim that they did not or could not reasonably have known that the procurement process and subsequent contracts were irregular and unlawful”.

The court action has been much delayed. Transnet said in a December 2019 statement that it would “approach the court to declare unlawful and set aside all four locomotive contracts”. After that, however, new management was appointed and it appears Transnet went back to the legal drawing board.

Transnet and the SIU said their application “is lengthy. The founding affidavit is over 800 pages and the annexures stretch into many lever arch files. The application is based on the extraction and analysis of over 29 million documents.”

In December, the SA Revenue Service convinced the high court to freeze R2.8-billion in local CRRC accounts, following an earlier temporary SA Reserve Bank freeze. DM


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All Comments 5

  • And you still have that squirming and devious thief and coward, Brian Molefe, like all of his ilk, claiming he did nothing wrong and is proud of his association with the Guptas!! Everywhere that odious individual went, he left a trail of corruption, misery and devastation. Treasonous monsters!!!!

    • And Molefe still believes he is totally innocent. His evidence yesterday at the Zondo Commission was shocking to the extreme. As slimy as an eel, but he eventually was put on the backfoot by a brilliant evidence leader

  • Ask China to interrogate the implicated persons at their rail company that paid the billions in bribes. Cooperate or face firing squad at dawn is the only way to deal with this.

    The Chinese government has full access to what was paid where and when. Just ask!

  • A question for DM that I am happily supporting. Why is there never a press conference where the media can put (uncomfortable) questions to CR? We are giving him a free pass. If he’s not prepared to attend this should be publicized.

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