The Free State High Court has granted the National Prosecuting Authority (NPA) a
R32-million preservation order targeting assets linked to former ANC secretary-general Ace Magashule and others implicated in a sprawling asbestos corruption and money laundering scheme.
The order, secured by the NPA’s Asset Forfeiture Unit (AFU), includes a luxury Mercedes-Benz G63 AMG, allegedly bought in cash for R2-million, symbolising the extravagant lifestyle funded by illicit proceeds.
Proceeds of a sophisticated criminal network
The NPA alleges that the seized assets comprising properties, vehicles, and other high-value items are the fruits of a sophisticated criminal network involving theft, fraud, corruption, and money laundering.
These activities are said to have defrauded the Free State Department of Human Settlements (FSDHS) of critical resources meant for public housing and welfare.
“The involved individuals, companies, and trusts engaged in a complex web of financial flows designed to siphon funds from the FSDHS,” said NPA spokesperson Mthunzi Mhaga.
“They moved the proceeds of crime through attorneys, real estate agencies, and high-end motor dealers to obscure their origins.”
The AFU’s investigation revealed that the frozen assets were purchased with funds looted from the FSDHS. Financial trails were meticulously traced to expose the laundering schemes.
R300-million restraint order granted in 2020
This preservation order follows a R300-million restraint order granted in September 2020. It is also tied to the asbestos scandal. And it underscores the scale of the alleged corruption during Magashule’s tenure as Free State premier.
The court’s ruling effectively freezes the assets, preventing any attempts to sell or transfer them. And it paves the way for their eventual forfeiture to the state.
The NPA emphasised that this step is crucial to recovering public funds lost to corruption. It also aims to ensure justice for affected communities.
In parallel, several individuals and entities face criminal charges. These include fraud, theft, money laundering, corruption, and violations of the Public Finance Management Act (PFMA) and Asbestos Regulations.
The accused allegedly exploited a R255-million asbestos removal contract, awarded irregularly. They allegedly used it to enrich themselves while failing to deliver meaningful services.
Complex web of financial flows
“The involved individuals, companies and trusts are alleged to have engaged in a complex web of financial flows designed to strip the FSDHS of its much-needed resources,” Mhaga said.
“They were allegedly able to move the proceeds of crime through attorneys, real estate agencies, and high-end motor dealers.”
Through financial flows, the NPA’s Asset Forfeiture Unit (AFU) demonstrated that these properties were purchased with monies siphoned from the FSDHS, Mhaga added.
“This preservation order follows a restraint order of R300-million granted to the unit by the high court in September 2020. This was in respect of the same asbestos corruption and money laundering scheme,” he said.
Assets may subsequently be forfeited to the state
The assets may subsequently be forfeited to the state, the spokesperson concluded.
The asbestos case finally started in April after Magashule and others were first arraigned in court in 2020.
The charges relate to a purportedly improper contract of R255-million for the removal of asbestos from 300 000 homes’ roofs.
Blackhead Consulting and Diamond Hill Trading
A joint venture between controversial businessman Edwin Sodi’s Blackhead Consulting and Diamond Hill Trading was given the contract. However, despite the money being paid, the work was allegedly never completed.
Despite the NPA’s stance, Magashule’s legal team, accusing the state of prosecutorial interference, was granted permission to question Calitz.
The trial is set to continue on Thursday.
Also Read: Court rules Ace Magashule’s lawyers can grill investigator
