EOH Holdings published an update on the investigation into suspicious transactions at the company alongside its annual results for the year ended 31 July 2019.
ENSafrica, the law firm retained by EOH to investigate allegations of corruption, identified suspicious transactions to the value of R1.2 billion earlier this year.
“The ENSafrica team has made significant progress on the investigation,” EOH said. “They have completed almost 80% of their investigation into the R1.2 billion identified suspect payments.”
“This amount has since been modified to R935 million and includes transactions with no evidence of valid contracts being in place or where no work was done, valued at R665 million; R90 million of loans written off and overbilling valued at approximately R180 million.”
Enterprise development partners
ENSafrica also identified the main modus operandi used by corrupt entities to commit wrongdoing at the company, which involved enterprise development partners and intermediaries.
Following this confirmation, EOH suspended payments to and blacklisted 50 enterprise development business partners which were implicated in suspect payments.
“Some of these ED partners have initiated legal challenges against the company; however, EOH is committed to ensuring that all perpetrators of wrongdoing are held accountable for their actions,” the company said.
“EOH is accordingly robustly opposing legal challenges brought by such parties.”
The investigation also confirmed that the main perpetrators of wrongdoing remain for the most part confined to a small number of people in the public sector team.
Evidence of various opportunistic fraud and theft incidents was also uncovered during the course of the investigation, resulting in the termination of the employees involved.
“It is important to emphasise that EOH is actively pursuing criminal charges as a complainant against various individuals implicated in wrongdoing,” EOH said.
“The investigation team is working closely with the authorities to ensure that they are able to identify illicit money flows.”
The company said it has initiated legal processes to recover losses caused by the perpetrators of wrongdoing.