Deloitte agrees R150m settlement with Eskom

By Paul Burkhardt

(Bloomberg) – Deloitte agreed to a R150m ($8.6m) settlement with South Africa’s state-owned power utility to end a dispute over the pricing of contracts.

Eskom wanted Deloitte to return fees for assignments agreed in 2016 that the state-owned power utility alleged were overpriced. The contracts were awarded during the tenure of former Chief Financial Officer Anoj Singh and ex-senior executive Prish Govender, both of whom have been tied to corruption probes at the utility. They deny wrongdoing.

“There were technical irregularities within the procurement process, and Deloitte Consulting accepts that it participated in this irregular procurement process,” Eskom and Deloitte said Friday in a joint statement. Investigations into the matter “showed no evidence of state capture or corruption,” said the companies.

Deloitte previously disputed the allegations, saying it was willing to contest them in court.

This is the latest out-of-court settlements reached by international companies which found themselves embroiled in South Africa’s government-linked scandals.

McKinsey & Co agreed to return money to Eskom after a dispute over the legality of its contract. Bain & Co. has returned money to the South African Revenue Service over an improperly awarded contract and KPMG has apologised for poor quality work that led to the departure of key revenue service officials.

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