A South African tribunal has frozen R4.2 billion linked to the local unit of CRRC Corp as investigators probe the Chinese firm’s deals with state-owned logistics group Transnet.
The Special Investigating Unit (SIU), which investigates corruption at state entities, said in a statement it believes the funds are “proceeds of unlawful activity”.
“The SIU together with Transnet approached the Tribunal to freeze the accounts following an intensive investigation … which raised the suspicion that CRRC paid kickbacks,” it said.
CRRC E-Loco Supply Ltd was not reachable on Thursday. Parent company CRRC Corp – the world’s biggest train maker – did not immediately respond to emailed requests for comment.
A Transnet spokeswoman said the SIU statement was the official position on the issue.
South African authorities are carrying out widespread probes into alleged irregularities in the awarding of lucrative contracts by state-owned companies during former president Jacob Zuma’s nine years in power.
Between 2011 and 2014, Transnet, which runs freight rail services, ports and pipelines, awarded CRRC three contracts worth a total of R25.4 billion to supply it with 554 locomotives, the SIU statement said.
The preservation order handed down on August 31 by the Special Tribunal, a court set up to fast-track recovery of misspent or stolen public money, prohibits CRRC from accessing the frozen funds, which are held in accounts linked to CRRC E-Loco Supply Ltd at three South African banks.
The investigators and Transnet have applied for the funds to be permanently forfeited to the state.
Zuma was jailed for 15 months in July for defying a constitutional court order to appear at a corruption inquiry.
He is currently in hospital, however, and the government said on Sunday he had been placed on medical parole for an undisclosed condition.
Zuma, in power from 2009 until 2018, denies wrongdoing.