Hitachi Ltd’s admission to having made improper payments to the African National Congress’ (ANC) investment company‚ “is clearly an admission of de facto corruption”‚ the Democratic Alliance (DA) said on Tuesday

The DA said it will be laying criminal charges against Chancellor House and writing to Public Protector Thuli Madonsela‚ requesting that her office institute an investigation into this matter‚ following the news about how the company won a R38.5-billion tender to provide Eskom with boilers for the Medupi and Kusile power stations.

Business Day reported that Hitachi Ltd paid Chancellor House a $1-million “success fee” and $5-million in “dividends” in connection with the contracts‚ the US Securities and Exchange Commission (SEC) charged on Monday.

The watchdog said Hitachi had agreed to pay $19-million to settle the charges‚ without admitting or denying the allegations.

The newspaper said that Chancellor House was‚ until last year‚ the empowerment partner of Hitachi subsidiary Hitachi Power Africa‚ in which it was a 25% shareholder.

“This quite clearly amounts to prima facie evidence of corruption which saw the ANC illegitimately profit to the tune of $6m via improper payments disguised as ‘consulting fees’ and other legitimate payments‚” a DA statement said.

“According to the SEC’s complaint‚ filed in US District Court for the District of Columbia‚ Hitachi was aware that Chancellor House was a funding vehicle for the ANC during the bidding process‚ yet continued to partner with Chancellor House and encouraged the company to use its political influence to help obtain government contracts from Eskom.”

Business Day quoted the SEC’s Andrew J Ceresney as saying: “Hitachi’s lax internal control environment enabled its subsidiary to pay millions of dollars to a politically-connected front company for the ANC to win contracts with the South African government.

“Hitachi then unlawfully mischaracterised those payments in its books and records as consulting fees and other legitimate payments.”

The DA commented: “This is clearly an admission of de facto corruption that implicates the ANC – a party that has infected government at every level with corruption.

“It is this very corruption which is robbing South Africans of opportunities and the delivery of services‚ and simply cannot be tolerated.

“Moreover it is deplorable that yet another ANC corruption scandal has negatively affected millions of South Africans as our load shedding crisis has been hampered by delay after delay at Medupi and Kusile - costing our economy millions of rands.”