FSCA confirms investigation into Joburg mayor’s company

The Financial Sector Conduct Authority (FSCA) has confirmed that it is conducting an investigation into complaints lodged against Ithemba Lama Afrika, an NGO owned by City of Johannesburg Mayor Kabelo Gwamanda.

The investigation follows allegations of financial misconduct and fraudulent activities, which have attracted significant media attention.

The FSCA has stressed that the existence of an investigation should not be seen as proof of any wrongdoing, but rather as an effort to ascertain whether any financial sector laws were violated.

“The FSCA emphasises that the existence of an investigation should not be construed as a statement or indication that any person has indeed contravened a financial sector law. The purpose of the investigation is to establish whether such a contravention has occurred. Once the investigation is concluded, the authority will inform the public of the outcome of the matter,” it said on Monday.

Over the weekend, reports emerged stating that Gwamanda’s business failed to meet the necessary registration requirements set by the FSCA, thereby operating without authorisation. As a result, the city’s residents, especially those who are most vulnerable, find themselves in a financially precarious situation.

The accusations indicate that Gwamanda misrepresented himself as a financial services provider and improperly handled funds entrusted to him by unsuspecting individuals who believed they were making investments in a funeral insurance.

According to media reports, the mayor is also under investigation for fraud at the Protea Glen Police Station in Soweto, Johannesburg, related to the same matter.

ActionSA on Monday called for Gwamanda’s immediate resignation after it tabled a motion of no confidence against the mayor.

The party’s Johannesburg caucus leader, Funzi Ngobeni, condemned Gwamanda’s alleged fraudulent activities and questioned his ability to address the needs of vulnerable residents while in office.

Ngobeni emphasised that these accusations must not be overlooked, and that prompt action is necessary to uphold ethical governance and protect the rights of the citizens.

Ngobeni further criticised the City of Johannesburg Council Speaker, Colleen Makhubele, of delaying the motion of no confidence to shield the mayor.

He said: “Speaker Makhubele and the ANC-EFF coalition, which elected mayor Gwamanda as a mayor to gain access to the city’s coffers, are protecting the mayor from accountability by delaying a MONC against him.

“ActionSA believes mayor Gwamanda has a serious case to answer and is not fit to be mayor when there are accusations that he defrauded the very residents he was supposed to serve. Therefore, we will write to Speaker Makhubele asking why she chose not to table the MONC at the council programming committee.

“ActionSA will continue talks with other opposition parties represented in the City of Johannesburg council to ensure that the office of the first citizen of this great city is occupied only by men and women of integrity who will put the interests of the residents first.”

As the investigation by the FSCA continues, the public awaits the outcome and hopes for transparency and accountability. These allegations have raised concerns about the trustworthiness of financial service providers and the need for robust measures to protect residents from potential exploitation.

Also read: ActionSA wants Joburg mayor to account for damning allegations

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