City of Cape Town and private sector join forces against construction mafia

City of Cape Town official Wendy Kloppers was gunned down in February 2023 at the Symphony Way Housing Project in Delft. (Photo: Supplied)

By Velani Ludidi

7 Aug 2024

The joint initiative comes in the wake of a number of criminal incidents, including the murder of City of Cape Town official Wendy Kloppers, who was gunned down in Delft at the Symphony Way Housing Project building site on 16 February 2023.

In a bold move to curb the influence of so-called construction mafias in Cape Town, the City of Cape Town and the South African Property Owners Association in partnership with leading developers Atterbury and Old Mutual Properties, have announced a collaborative effort to protect key development projects from criminal syndicates.

The initiative, which includes increased security measures and the establishment of a dedicated task force, is seen as a proactive step to protect investments and ensure the timely completion of development projects. The City has also called on national law enforcement agencies to strengthen efforts in combating these syndicates.

This announcement comes amid growing concerns over the rise of construction mafias, which have wrought havoc on the construction industry by demanding “protection fees” from contractors and developers. The syndicates, often under the guise of local business forums, have been accused of using intimidation, violence, and extortion to halt projects until their demands are met.

Protests for inclusivity

The origins of these groups can be traced back to grievances about the exclusion of local businesses from lucrative contracts in the construction sector. However, what began as legitimate protests for inclusivity has, in some cases, devolved into criminal enterprises exploiting the situation for financial gain.

Louis van der Watt, the Group CEO of Atterbury, highlighted the complexities in detecting illegality in business, especially when these entities operate under the guise of legitimacy.

Van der Watt said that these businesses possessed all the necessary legal documentation, making it challenging to identify their true nature through standard vetting processes. He emphasised the need for collaboration with national and local governments, including the South African Police Service (SAPS) and the South African Revenue Service, to help identify them.

“The construction mafia in Cape Town regularly operate through legally registered entities with valid bank accounts and tax clearance certificates,” he said. “Financial statements, company registration documents, directorship information and other business certifications are in order, making it extremely difficult to detect any connections to criminal activities through standard procedures.”

He added that the property sector relied heavily on the National Treasury to maintain and make available an updated list of blacklisted entities, and that the private sector needed more resources and capacity than local and national governments had in identifying non-compliant entities.

Daily Maverick previously reported that Cape Town’s City Manager Lungelo Mbandazayo had initiated an investigation that led to the blacklisting by the National Treasury of Glomix, a construction company owned by Nicole Johnson, a crime accused person and the wife of suspected 28s gang boss Ralph Stanfield.

Ralph Stanfield and Nicole Johnson. (Photo: Jaco Marais/Gallo Images/Die Burger)

Read more on Daily Maverick: Security boost for Cape Town city manager after blacklisting of company owned by 28s gang case-accused

Glomix House Brokers has been involved in housing projects in Cape Town worth millions of rand for more than a decade.

Read more in Daily Maverick: Company previously flagged over ‘28s gang’ suspicions still building houses for Western Cape government

Johnson is the director of Glomix, which was awarded housing contracts after 2014 when she and Stanfield were first arrested and faced criminal charges.

The couple were arrested again, along with three others, in September 2024 in another case related to car theft and fraud, for which they remain in custody.

arrest construction mafia murder cape town wendy kloppers City of Cape Town official Wendy Kloppers was gunned down in February 2023 at the Symphony Way Housing Project in Delft. (Photo: Supplied)

Mbandazayo initiated an investigation into companies doing business with the municipality following the murder of City of Cape Town official Wendy Kloppers, who was gunned down in Delft at the Symphony Way Housing Project building site on 16 February 2023.

Mbandazayo had previously said Kloppers was killed after the City refused to give in to the demands of gangsters demanding work from contractors at the housing project.

It was after this investigation that several companies owned by Johnson were blacklisted by the municipality.

Vetting process

Atterbury is further strengthening its vetting processes for sub-contractors, ensuring it adheres to ethical business practices.

Cape Town Mayor Geordin Hill-Lewis pledged that the City would continue holding the National Treasury to account in maintaining an updated blacklist, which is available on the Treasury website. The City further committed to introducing a process of vetting approved community liaison officers representing local communities in various development projects.

“Together, we can ensure that our construction projects contribute positively to the economy without falling prey to extortionists. The City will use all legal means to combat the construction mafia, collaborate and share information with the private sector, and protect our communities from the scourge of organised crime,” said Hill-Lewis.

Old Mutual welcomed the City of Cape Town's involvement in assisting businesses in identifying companies with underworld links. The company says it ensures a robust procurement and screening process is in place for all service providers, and has never considered using any suppliers that have been blacklisted.

Neil Gopal, the CEO of the South African Property Owners Association, said: “We at the association welcome the collaborative efforts of the City of Cape Town and the private sector to address and eradicate the negative influence of the construction mafia that has long hindered property development in our cities.

“This decisive action is crucial for the growth and sustainability of our urban areas and the broader South African economy. We hope that this initiative will establish a standard for other municipalities to follow, ensuring a safer and more conducive environment for property development.” DM

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Business Maverick

Protests for inclusivity

Vetting process