The Unemployment Insurance Fund (UIF) and the Special Investigating Unit (SIU) have targeted KwaZulu-Natal-based Ziqoqe Construction CC over the alleged misappropriation of approximately R9.8 million in COVID-19 TERS funds.
The Special Tribunal granted a preservation order that successfully restricts the transfer or sale of a R2.7 million Hillcrest property linked to the suspects.
The primary legal action taken against Ziqoqe Construction CC is a preservation order, which will eventually culminate in an application for a final forfeiture order to permanently seize the frozen assets.
The specific actions underway and the anticipated end results of this case are outlined below.
Asset Freezing (Preservation Order): The Special Investigating Unit (SIU) successfully secured an interim preservation order from the Special Tribunal.
This action legally freezes a R2.7 million luxury property in the Sienna Estate Scheme in Hillcrest, eThekwini, which was purchased in November 2023. The Deeds Registry has been directed to place restrictions on it.
Restriction on Operations: The owner, Mr. Ndabezinhle Luthuli, and the close corporation are strictly prohibited from selling, transferring, mortgaging, or renting out the property.
Financial Penalty Maintenance: While the case is pending, the court has forced the respondents to remain fully liable for all municipal charges, levies, insurance premiums, and maintenance costs for the property.
Evidentiary Seizures: Following the initial probe under Presidential Proclamation R.8 of 2021, the SIU conducted extensive search-and-seizure operations to secure bank records and digital evidence documenting how the R9.8 million in UIF TERS funds disappeared.
Anticipated End Results of the CaseCivil Forfeiture of Assets: The immediate next step for the SIU is to return to the Special Tribunal to apply for a final forfeiture order. Once granted, ownership of the R2.7 million Hillcrest property will permanently transfer to the State.
The property will then be auctioned or sold to recover a portion of the stolen(recover) public funds.
Disgorgement of Profits & Debt Recovery: Because Ziqoqe Construction CC claimed funds for 673 “ghost employees” and kept all the cash, the Special Tribunal is highly likely to declare the entire TERS payout transaction unlawful.
This will result in a judgment ordering the company and its director to repay the full outstanding balance of R9,836,047.06 to the Unemployment Insurance Fund (UIF).
Criminal Prosecution: The SIU routinely refers its investigative findings to the National Prosecuting Authority (NPA). Given that the evidence highlights a deliberate money-laundering scheme using fictitious employees, criminal charges including fraud, theft, and violations of the Prevention of Organised Crime Act (POCA) will likely lead to the arrest and prosecution of Mr. Luthuli and any complicit runners.
Blacklisting & Directorship Delinquency: The company faces being blacklisted from the National Treasury’s supplier database, preventing it from ever securing future government contracts.
Mr. Luthuli may also be declared a delinquent director, legally banning him from running any close corporations or companies in South Africa.
BY LUCKY SEANEGO
