Hawks swoop on City Power in R500m scandal: Raid or routine? Corruption probe intensifies

Key topics:Hawks visited City Power over R500m in suspect paymentsUtility insists no raid took place, only info requestInternal probes reveal widespread fraud, collusion, and wasteful spendingSign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here.The auditorium doors will open for BNIC#2 on 10 September 2025 in Hermanus. For more information and tickets, click here..By Kerry Lanaghan.Johannesburg's City Power is embroiled in controversy following conflicting accounts of a so-called "raid" by the Hawks on suspicious payments amounting to nearly half a billion rand.Reports initially emerged on Friday that Hawks officials had stormed City Power’s headquarters on 25 July, seizing stacks of documents related to three questionable contracts allegedly signed off by senior executives. EWN claimed investigators were seen entering and exiting the premises with files in hand, marking what appeared to be a dramatic intervention in a widening corruption probe.But City Power has rejected the depiction of a dramatic raid, insisting that there was no seizure of documents or aggressive investigative action. Instead, City Power spokesperson Isaac Mangena clarified that the Hawks merely “visited” the offices to deliver a formal request for information (RFI). “There was no raid, no confiscation of documents, files or IT equipment. And there was no interrogation,” Mangena said.Nonetheless, the underlying allegations are serious. Three payments are at the heart of the investigation, including a staggering R335 million reportedly spent on failed maintenance projects. One deal saw prices allegedly inflated by over 1,000%; a quote of R8 million for electricity infrastructure ballooned to a R100 million payout. Another involved hiring a private firm for R55 million to perform managerial duties, despite City Power already having executives for that role.According to The Citizen, internal investigations previously revealed wasteful spending on non-essential items such as air fresheners, pens, and trolley mops - none of which could be confirmed as delivered. These purchases were allegedly charged to the maintenance budget during a six-month window in 2023.Adding to the gravity of the situation, a March 2025 report - following an Auditor-General recommendation - concluded that there had been widespread collusion between City Power employees and service providers. Fraudulent job numbers, duplicate approvals, and breaches in procurement processes were cited as key weaknesses. The financial losses were described as “significant.”City Power has since dismissed several implicated employees and filed criminal complaints. Among those ousted are 12 electricians, eight security officers, five team leaders, and several senior managers. Charges include fraud, cable theft, and soliciting bribes. The utility also uncovered that employees had been handing materials directly to contractors, bypassing official protocols.While the Hawks have yet to confirm whether a criminal case has been opened formally, Mangena said City Power is cooperating with the lawful RFI process. “We will provide all relevant documentation and support efforts to hold those responsible accountable.”The developments come as City Power is under pressure to rebuild public trust and stabilise its finances amid persistent load-shedding and growing public frustration. Despite these troubles, the utility recently celebrated achieving an unqualified audit and reaching 75% of its operational targets - a small bright spot in an otherwise turbulent period.Whether the visit from the Hawks was a raid or a routine request, the message is clear: City Power remains under intense scrutiny.

Hawks swoop on City Power in R500m scandal: Raid or routine? Corruption probe intensifies

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