The Special Investigating Unit (SIU) has uncovered an alleged land fraud network exploiting the replacement deed process to illicitly transfer state-owned land to private entities. The SIU and National Prosecuting Authority have seized assets worth almost R197m and criminal charges have been laid.
An ongoing Special Investigating Unit (SIU) probe has pulled back the curtain on an alleged sophisticated fraud scheme that appears to have siphoned hundreds of millions of rands from the state and unsuspecting private businesses.
At its core is an alleged collusion network involving high-profile real estate agents, conveyancers and Deeds Office officials who are accused of fraudulently transferring state-owned land to private individuals and companies.
The SIU and the National Prosecuting Authority’s (NPA) Asset Forfeiture Unit have already been granted several preservation orders, seizing approximately R197-million in assets, and a criminal case has been registered with the Hawks.
Daily Maverick has court documents and affidavits relating to the properties named in the SIU investigation in which legal safeguards on property ownership were systematically bypassed.
Central to this investigation are Michael Blumberg, a key facilitator behind Umbomi Development, a property vehicle established to execute suspect transactions; Ngwako Segwapa of Segwapa Inc, a conveyancer connected to multiple irregular property transfers; and Maqhawe Morobe, son of ANC stalwart Murphy Morobe, who allegedly acted as an intermediary for these deals.
Documents reveal additional parties and companies connected to the final stages of these transfers: B&B Media and RIC Developments, both implicated as end purchasers of fraudulently transferred properties; Umbomi Development, the entity linked to Blumberg that played a direct role in acquiring and reselling key properties; and Mondosys, a company of which Blumberg is a director, which reportedly handled significant payments, potentially aiding in obscuring the money trail.
Together, these figures and entities form what investigators describe as a coordinated effort to exploit legal processes, using forged documentation and manipulated Vervangingsakte (replacement deeds) filings to reassign government land under the guise of legitimate property transactions.
Vervangingsakte — the most important document you’ve never heard of
At the core of this fraud is a document called the Vervangingsakte (VA), or “replacement deed”. Typically, a VA is issued to restore the official record of property rights when a deed is lost or destroyed.
However, recent investigations reveal that the VA process has been exploited, with manipulated VAs enabling fraudulent ownership transfers on a potentially vast scale.
The true scope of this exploitation is difficult to gauge, as it remains unclear how many properties may have been fraudulently transferred through this process, but Daily Maverick has identified at least several more properties linked to other persons that follow a similar methodology.
Legal experts underscore that, in theory, the VA process contains numerous safeguards to prevent abuse. According to Samantha Petersen, real estate and property law director at Norton Rose Fulbright, a VA application requires the property owner to sign a written application and an affidavit detailing the loss or destruction of the original deed.
“The registered property owner must sign a written application and a supporting affidavit detailing the circumstances of the lost deed.”
The affidavit must be signed before a commissioner of oaths, who verifies the applicant’s identity. Furthermore, the process mandates “written consent from all interested parties, such as bondholders, and public notice of the application in a local newspaper”, adds Petersen.
The Deeds Office inspection period — typically two weeks — provides a window for objections.
Yet, as Nelien du Toit, conveyancer and director of DTB Incorporated, explains, these protocols, though rigorous, are not infallible.
“While the process itself has strong safeguards, much of the responsibility rests on conveyancers to ensure compliance — when checks are circumvented, or officials are complicit, it becomes alarmingly simple to bypass the legal protections in place.”
In at least one instance, apparently forged high court judge orders facilitated the issuance of fraudulent VAs.
Civil proceedings
One of the key entities entangled in this scheme is B&B Media, a large advertising company named in an SIU press release in March 2023. The company became the titleholder of multiple properties through the VA process, which it claims were purchased lawfully.
As the final purchaser of several allegedly fraudulently transferred government properties, B&B Media asserts that it was an innocent third party, unaware of the fraudulent nature of the transactions.
In a media statement on 30 October, B&B Media reaffirmed its position, stating, “We value integrity, transparency, and ethical business practices. Upon discovering irregularities in these transactions, we took immediate measures to address the situation.”
The company added that it has “been fully cooperative with law enforcement agencies, including the SIU, NPA, AFU, and SAPS”, though it noted a lack of specifics from the SIU regarding the investigation.
B&B Media further reported that it “conducted forensic investigations into all fixed property asset acquisitions over the past five years” and identified another property in Pimville, Johannesburg, that it believes may be similarly compromised.
B&B Media has since initiated civil proceedings, serving letters of demand on both Morobe and Blumberg, and summonses are expected to be issued soon.
Regarding a property in Zuurfontein, Gauteng, B&B Media claims it informed RIC Developments’ auditors of the Asset Preservation Order. The company also emphasised the extraordinary due diligence measures it has since implemented to prevent future occurrences.
B&B Media, according to its recent media statement, has initiated civil proceedings against those it alleges have defrauded the company, with letters of demand already issued
“We are committed to cooperating fully with the authorities,” reads its statement.
“Our company, like the state and other private parties, are victims of a sophisticated and elaborate organised scheme of fraudulent criminal racketeering.”
RIC Developments, a real estate development firm which was the final purchaser of the land, acknowledged receipt of Daily Maverick’s questions, noting that it was reviewing the queries and would respond in due course. It also requested information on the intended publication date to facilitate its reply, but no further comment was received at the time of publishing.
The Randjiesfontein case: A study in property fraud
According to court documents and affidavits seen by Daily Maverick, the sale of Farm 405 Randjiesfontein — a government-owned property in Gauteng designated for public use — unfolded through a series of orchestrated steps, allegedly involving multiple intermediaries, conveyancers, and officials.
The property was originally held under the national government’s ownership per Deed of Transfer No. T7262/1986. According to the SIU investigation, the property was originally held by the “Administration House of Delegates, Department of Local Government, Housing and Agriculture” — the old Indian Affairs body.
Documentation later presented in the sale process claimed that the government had sold it to Cornelius Terblanche Jordaan for R6,246,700 in 1989.
Authorities now allege that this sale and supporting documentation were falsified as part of a larger fraudulent scheme.
In 2017, Jordaan, who has since died and cannot be further questioned, stated in an affidavit to investigators that he was initially unaware of owning any property. He claimed to have been approached by intermediaries, including Maqhawe Morobe, who assured him the transaction was legitimate.
Morobe allegedly introduced Jordaan to Blumberg, director of Umbomi Development, who became a key figure in moving the sale forward. Blumberg, a property agent with extensive networks in property investment, purportedly used his contacts to facilitate the acquisition for R18-million, with Umbomi Development managing much of the administrative process.
Jordaan later asserted that Ngwako Segwapa, the conveyancer overseeing the transfer, presented him with documents to sign, which he did in exchange for a portion of the payment — an act he claimed solidified his belief in the sale’s legitimacy.
Blumberg’s involvement reportedly extended beyond facilitation, with allegations that Umbomi Development knowingly utilised forged documentation, including high court orders with falsified signatures, to expedite the property transfer.
These forged court orders purportedly enabled manipulated Vervangingsakte filings, bypassing standard legal checks. This process allowed the property to be quickly transferred to private entities, allegedly with support from officials within the Deeds Office.
Forensic evidence from the SIU indicates that Blumberg, Segwapa and possibly complicit Deeds Office officials coordinated efforts to push the transaction through without the required scrutiny, implicating multiple private and public sector actors.
Addressing the allegations
When approached for comment, Segwapa provided Daily Maverick with a variation high court order that he says removed him as an interested party in the case. Segwapa’s statement read, “We are not in a position to assist further.” His office has thus far refrained from addressing specific allegations in the case, citing the court’s determination.
Blumberg, contacted telephonically and via email, refused comment, citing legal advice.
Morobe, in response to telephonic questions from Daily Maverick, denied any intentional involvement in fraud, asserting that he acted purely as an intermediary to connect parties and was not directly involved in processing documents or ensuring legal compliance.
When approached for additional clarification, he reserved further comment, citing possible legal proceedings. However, bank records reveal that Morobe received payments associated with transfers linked to Umbomi, suggesting his role may have extended beyond simple introductions.
Further examination of the case by the SIU has pointed to systemic failures within the Deeds Office. The original title deed for Farm 405 Randjiesfontein was reportedly “lost”, necessitating a replacement deed, or VA, to restore ownership records.
Instead of following standard procedures — which include an inspection period and verification stages — the replacement deed was allegedly processed through fraudulent means, circumventing due diligence.
Allegedly, officials at the Deeds Office expedited the VA issuance by using forged high court orders bearing the signatures of justices Petersen and Carelse J, who later confirmed via affidavits that their signatures had been forged.
The SIU’s investigation uncovered multiple irregularities in the Deeds Office’s processing of the VA, including the apparent bypassing of the mandatory review and inspection period, which typically allows for public objections. By fraudulently fast-tracking these procedures, the transaction advanced without proper oversight, allowing the property to be unlawfully transferred.
The financial trail associated with the Randjiesfontein transaction reveals further layers of complexity. Umbomi Development is documented to have transferred R20.4-million to Mondosys and Blumberg allegedly for property development services.
Investigators believe these payments through the companies linked to Blumberg were part of a larger scheme to obscure the origins and final destinations of funds associated with the illicit transfer.
Bank records show that these funds passed through multiple accounts, with Mondosys functioning as an intermediary, distributing payments to several recipients. This complex financial structure appears designed to conceal the fraudulent nature of the transactions, linking the payments directly to the unlawful acquisition of government land.
Additional transfers under investigation
The Randjiesfontein scheme reflects a broader pattern observed across multiple properties, including Portion 296 of Farm 33 Zuurfontein and Holding 34, both in Gauteng.
In these cases, similar mechanisms were employed, with Blumberg and Segwapa allegedly playing central roles, supported by forged high court orders that facilitated the transfer of government-owned land to private parties like B&B Media and RIC Developments.
For Zuurfontein, the land was transferred to B&B Media through manipulated legal documents. Daily Maverick reviewed documents detailing the SIU’s investigation, revealing that forged court orders removed legal restrictions on the land, enabling its sale to private parties.
B&B Media claims it discovered the fraud post-transaction and has cooperated with law enforcement.
Holding 34 of Beverly Agricultural Holdings was allegedly unlawfully transferred using the same fraudulent VA process, with forged court orders validating the sale. RIC Developments was named as the buyer in court documents.
When contacted, RIC’s sales manager, Phillip du Buisson, acknowledged receipt of Daily Maverick questions, stating, “We are considering the questions and will revert in due course.”
The Misdeeds Office
The SIU investigation has pointed to systemic failures and alleged corruption within the Deeds Office, which falls under the Department of Rural Development and Land Affairs, with several officials implicated in facilitating these fraudulent transfers.
The scale of the fraud, spanning multiple properties and millions of rands, suggests a coordinated effort across different regions, particularly in the metros of Tshwane and Johannesburg.
Documents obtained by Daily Maverick show that fraudulent VAs were filed in deeds registries nationwide, with many properties later returned to state ownership after unlawful sales. This cycle not only defrauded the state but exposed private businesses to significant financial risks.
The Deeds Office was contacted for comment regarding these allegations and processes. At the time of publishing, no response had yet been received, except for an acknowledgement from Linda Page, the chief director of strategic communication at the Department of Rural Development and Land Affairs, stating, “I acknowledge receipt of your email and we will respond.”
What next for the VA?
The SIU has referred evidence of criminal conduct to the National Prosecuting Authority (NPA), with a criminal case registered with the Hawks.
Affidavits from key witnesses, including Mduduzi Shabane, the director-general of the Department of Rural Development and Land Reform, outline extensive collusion between private and government actors.
The SIU and NPA did not respond to multiple requests for comment. DM
Correction: This article was updated at 9:44 on 8 November 2024 to reflect that Michael Blumberg is not the head of AuctionInc, and that the actions he is alleged to have taken are previous to his employment at AuctionInc.