Former Eskom contractor Michael Lomas has admitted paying R2.2 million in kickbacks to senior officials overseeing the Kusile Power Station. The admission forms part of a plea agreement with the Investigating Directorate Against Corruption. Alongside him, Hudson Kgomoeswana, who ran the Babinatlou slush fund, received an effective five-year prison sentence.

The scheme, first exposed in News24’s The Eskom Files investigation, involved contractors channelling money to Eskom officials linked to the mega-project.

Lomas Admits R2.2 Million in Kusile Kickbacks

On Thursday, Michael Lomas, who worked for Tubular Construction Projects, admitted paying R2.2 million to senior Eskom officials responsible for Kusile. The payment formed part of a larger criminal network operating inside Eskom’s group capital division.

Lomas entered a plea-and-sentence agreement with the IDAC. The court sentenced him to 15 years’ imprisonment, wholly suspended for five years. As part of the deal, he is expected to testify against his co-accused.

Hudson Kgomoeswana, director of Babinatlou Business Services, pleaded guilty to corruption, money laundering and contraventions of the Tax Administration Act. He received an effective five-year prison term. The court ordered the confiscation of his assets valued at R2.4 million.

Babinatlou Slush Fund Channelled Millions

Babinatlou Business Services acted as the central vehicle for alleged bribes from about 12 contractors to senior Eskom officials. News24’s reporting showed that roughly R76 million flowed into the fund. Tubular Construction Projects contributed about R6.2 million.

Other contractors listed in the investigation included Tenova Mining (R46.2 million), Esor Construction (R20.5 million) and Stefanutti Stocks (R2.2 million). Officials allegedly spent the kickbacks on luxury cars, properties, exclusive school fees and personal business interests.

These same officials oversaw Kusile, a project whose cost rose from R81 billion to R160 billion. Most of those named resigned or were suspended while investigations continued.

How the Scheme Operated and who Benefited

According to the leaked documents that underpinned The Eskom Files, former Eskom manager Frans Hlakudi allegedly manipulated claim negotiations to favour certain contractors in return for kickbacks. Hlakudi later said Abram Masango, then group executive of the group capital division, instructed him to ensure companies linked to Masango, including Tubular, received work on Kusile.

Bowmans, the law firm that investigated Kusile for Eskom in 2018, detailed multiple benefits flowing to officials. These included payments for vehicles, farm upgrades, school fees and direct transfers to family members. Hlakudi and Masango appeared in the Gauteng High Court in Johannesburg on Friday. Their trial continues.

The Hawks arrested Hlakudi, Masango and Kgomoeswana in December 2019. Several other senior managers resigned before disciplinary processes concluded.