Among the accused are Garry Pita, Phetolo Ramosebudi, Eric Wood and Daniel Roy who face charges of fraud, corruption, money laundering and contravention of Public Finance Management Act.
Following his arrest on Friday, former Transnet CEO Siyabonga Gama, who is one of five people accused of R93 million in fraud and corruption in a case involving the procurement of 1 064 locomotives by the state-owned freight rail business, was freed on R50 000 bail.
Former Transnet executives include acting chief financial officer Garry Pita, ex-group treasurer Phetolo Ramosebudi, Regiments’ Eric Wood, and Trillian Asset Management director Daniel Roy are also facing accusations.
The charges include fraud, corruption, and money laundering, as well as a violation of the Public Finance Management Act.
The State Capture inquiry looked into allegations of overpayment and corruption in Transnet’s locomotive contracts, with a number of the company’s former executives and board members testifying about the contentious procurement.
Gama is the first high-profile former head of a state-owned enterprise to be prosecuted criminally with corruption.
The Zondo Commission recommended earlier this year that Brian Molefe, Gama’s predecessor at Transnet, former chief financial officer Anoj Singh, and Gama be punished for their roles in Transnet’s illicit locomotive purchase.
The Investigating Directorate stated that Transnet in 2012 did a Request for Proposal tender to get transaction advisory services to secure funding for $2.5 billion to fund the acquisition of the 1 064 locomotives deal.
In May 2015, the company appointed JB Morgan for advisory services. However, between July and October 2015, the same officials in Transnet started facilitating the termination of the JB Morgan contract. JP Morgan was later replaced with the Gupta-linked Trillian in October 2015.
The accused had been told to present themselves to the police before their appearance at the Palm Ridge Specialised Crimes Court.
Wood was granted bail of R250 000, Ramosebudi R25 000 and the rest were reach released on R50 000.
Spokesperson for the National Prosecuting Authority’s Investigating Directorate, Sindisiwe Seboka, said that more arrests were expected in the matter.
They were briefly joined in the dock by Kuben Moodley, who was arrested in September 2021 in connection with alleged money laundering of the proceeds from contracts improperly awarded by Transnet to Regiments and Trillian, as well as alleged theft of funds from the Transnet Second Defined Benefit Fund, as Fin24 reported previously.
In his affidavit in support of bail, Gama stated that an investigating officer in the case had informed his lawyer that the charges against him were in connection to the so-called “Club Loan” facility which was secure during his tenure at Transnet.
He explained that Club Loan was secured for the purpose of financing the acquisition of locomotives and various infrastructure projects. He also mentioned that he had given evidence at the State Capture on the loan.
“It was clear to me that the evidence leader of the commission intended to prove that I was complicit in wrongdoing in the Club Loan process.
“It is my sincere intention to deal with these allegations levelled against me should the trial proceed against me,” said Gama in his affidavit.
Gama was appointed Transnet CEO in April 2016, having acted in that position for the previous 12 months. Prior to that, he had been the head of the company’s freight rail unit.
The head of the Investigating Directorate, Andrea Johnson, said the unit was is “on track to hold accountable those alleged to have been at the centre of, or facilitated state capture”.
“This is the second seminal matter enrolled this week and more can be expected within six months.”
All the accused will return to court on 13 July, where additional people would be added to the case.
Johnson was referring to the arrests this week Gupta stalwart Ronica Ragavan, former mineral resouces deputy director-general Joel Raphela and other associates of the controversial family. They face fraud and money laundering in relation to the rehabilitation funds of the Optimum and Koornfontein coal mines, and are currently out on bail as well.
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