EOH CEO Stephen van Coller.
- Chief Justice Raymond Zondo applauded EOH for working with the commission of inquiry into state capture to unearth corruption in the company.
- The commission recommends investigation against some former EOH executives.
- EOH has already paid back some of the funds that were subject to irregular conduct by its executives.
As a private entity once entangled in large-scale tender irregularities, EOH has earned praise from the commission of inquiry into state capture for its efforts to put its troubled past behind it. The report commended the company’s cooperation with the commission, and the proactive measures taken to remedy the historic wrongdoings within its ranks, saying the action made it a “unique case”.Still, the praise did not erase its record of problematic dealings with the state, which included over-billing and collusion with public officials.According to the report, over-invoicing of public sector clients and inflation of prices with the help of individuals within government departments was a recurrent feature in the company’s dealings with the public service.Such practices included two Microsoft licensing deals with the Department of Defence and an SAP licensing agreement with the Department of Water Affairs. The company also bypassed procurement procedures conducted by the State Information Technology Agency, SITA, and went on to bill inflated rates. Zondo highlighted that the matters involving irregular procurement practices at EOH were first brought to the commission’s attention by the company itself.READ | EOH says it stepped up for SIU probe into govt tendersHe said primary credit for the attitude taken by EOH must be accorded to CEO Stephen van Coller. The executive took over the CEO position in September 2018 and has led the company’s turnaround, including the repayment of some of the misappropriated funds to government departments.In April 2021, EOH agreed to pay back over R40 million from contracts awarded by the Department of Defence that were found to be irregular.
The report’s findings further indicate that EOH should not be allowed to retain the benefits of historical corrupt and irregular procurement practices, and notes the company, under Van Coller’s leadership, does not seek to do so. “It is proactively investigating its historical involvement in the corrupt and irregular procurement processes, bringing the relevant facts to the attention of the authorities and tendering to make reparations to the organs of state at whose expense it profited.”READ | Save our jobs, plead ‘desperate’ EOH employees who provide ‘essential services’ to City of JoburgThe commission recommended a probe into the 2014 awarding of a contract by the City of Johannesburg to TSS Managed Services to upgrade the city’s network and security infrastructure. The contract was concluded while the late mayor of Johannesburg, Geoff Makhubo, was the MMEC of Finance.The probe must be done with a view to prosecuting former EOH executives Mackay and Ebrahim Laher and Patrick Makhubedu, the report said.It noted that Makhubo is now deceased.The report also recommends an investigation into the 2016 award of an SAP contract to EOH Mthombo by the the City of Johannesburg.
