Ace Magashule
By Thabo Mosia
The Free State High Court has granted the National Prosecuting Authority (NPA) a R32 million preservation order against individuals linked to the asbestos corruption and money laundering scheme, but notably, former Free State Premier Ace Magashule is not included in this order. This significant ruling targets assets believed to be proceeds of a fraudulent R255 million asbestos removal tender, including a luxury Mercedes-Benz G63 AMG purchased for R2 million in cash. The decision is part of a broader effort to tackle corruption that has drained resources from the Free State Department of Human Settlements (FSDHS), spotlighting a scandal that has gripped South Africa for nearly a decade.
A Major Step in the Asbestos Corruption Case
The Free State High Court’s preservation order, valued at over R34 million, includes six immovable properties worth R32 million and the eye-catching Mercedes-Benz G63 AMG. These assets are alleged to be the spoils of a complex criminal scheme involving theft, fraud, corruption, and money laundering. According to the NPA, the funds used to acquire them were siphoned from the FSDHS, a department meant to improve living conditions for Free State residents. The Asset Forfeiture Unit (AFU) painstakingly traced the money through a web of financial transactions, revealing how it flowed through attorneys, real estate agencies, and high-end motor dealers to hide its origins.
NPA national spokesperson Mthunzi Mhaga described the scheme, saying, “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.” He added, “They were allegedly able to move the proceeds of crime through attorneys, real estate agencies, and high-end motor dealers.” This preservation order builds on a previous R300 million restraint order granted in September 2020, showing the NPA’s determination to recover assets linked to the same asbestos corruption and money laundering scheme.
The order freezes the assets, stopping any attempts to sell or transfer them. This move sets the stage for their eventual forfeiture to the state, ensuring that ill-gotten gains are returned to the public purse. For many South Africans, the Mercedes-Benz—bought outright in cash—stands out as a glaring symbol of the lavish lifestyles funded by corruption, while ordinary citizens continue to suffer from underfunded services.
Who’s Affected by the Order?
While Ace Magashule’s name is absent from this specific preservation order, it directly impacts several key figures tied to the asbestos scandal. Among them is Michelle Pambani, widow of the late businessman Igo Mpambani, who was a business partner of Edwin Sodi, a prominent accused in the case. The order also affects Sodi himself, along with other individuals and entities, including the Kad siblings and their associated companies. These parties now have 14 days to challenge the order, granted in March, or the NPA will move to secure a final forfeiture order within 90 days.
The exclusion of Magashule from this order has raised eyebrows, given his central role in the broader criminal case. As the former Free State Premier and ANC Secretary-General, Magashule faces charges alongside 17 others for his alleged involvement in the asbestos tender fraud. However, the NPA clarified that this preservation order focuses on a specific subset of assets linked to other accused individuals, forming part of the larger R300 million restraint from 2020.
The NPA’s Two-Pronged Approach
The NPA is tackling the asbestos scandal with a dual strategy, as outlined by Mthunzi Mhaga. “This is an integrated approach by the Asset Forfeiture Unit,” he explained. “The R32 million worth of assets, which is six immovable properties and one Mercedes-Benz that was bought cash for R2 million, is part of that R300 million worth of assets that had been seized in 2020.” The NPA is using both conviction-based forfeiture under Chapter 5 of the Prevention of Organised Crime Act (POCA) and non-conviction-based forfeiture under Chapter 6. This means they can seize assets proven to be proceeds of crime, even without securing a criminal conviction.
Mhaga emphasised the NPA’s goal: “If you benefited from state capture-related cases, any financial incentive that is derived from that, we’re taking it away from the accused person. So it’s hitting where it matters most—in their pockets.” This approach reflects a growing trend in South Africa’s fight against corruption, targeting the profits of crime to deter future wrongdoing and recover funds for the state.
Inside the Courtroom: Cross-Examination Drama
The preservation order coincides with ongoing criminal proceedings that have seen heated exchanges in court. Advocate Laurence Hodes, representing Ace Magashule, was recently granted permission to cross-examine the first witness, Benjamin Khaled, an investigator in the case. Hodes aimed to prove that the NPA was using Moroadi Cholota—Magashule’s former personal assistant and a co-accused—to incriminate his client. Cholota, extradited from the United States, has raised a special plea challenging the court’s jurisdiction, claiming procedural flaws in her extradition.
Hodes also accused the NPA and the Hawks investigating officer of misrepresentation, alleging that Cholota had agreed to testify for the state but that proper processes were ignored. This sparked a debate about the integrity of the prosecution’s case. However, the judge took a cautious stance, allowing Hodes to cross-examine Khaled on limited grounds related to Cholota’s special plea, rather than Magashule’s broader defence.
Mhaga brushed off these concerns, stating, “We firmly believe that there is no underhanded conduct or that is untoward that was displayed by the investigating officer and the prosecution team. Everything according to us was done above board.” He added that the NPA would clarify any issues during the re-examination of witnesses, expressing confidence in their evidence.
The Roots of the Asbestos Scandal
The asbestos tender fraud dates back to 2014, when the Free State government awarded a R255 million contract to Blackhead Consulting and Diamond Hill Trading—companies linked to Edwin Sodi and Igo Mpambani, respectively. The project was meant to audit and remove dangerous asbestos roofing from 300,000 homes across the province, protecting residents from health risks like lung disease caused by asbestos exposure. But the work was never completed, despite the hefty payout, leaving communities vulnerable and taxpayers footing the bill for a sham.
Investigations revealed that the tender was inflated and irregularly awarded, with funds diverted to benefit a network of politicians, officials, and businesspeople. The scandal came to light during the State Capture Inquiry, chaired by Chief Justice Raymond Zondo, which exposed widespread corruption during Jacob Zuma’s presidency. Magashule, who was Free State Premier at the time, is accused of orchestrating the scheme, though he denies any wrongdoing.
The criminal case involves 18 accused, including Magashule, Sodi, Cholota, and several former government officials. They face a slew of charges: fraud, theft, money laundering, corruption, and violations of the Public Finance Management Act (PFMA) and Asbestos Regulations. The trial has been plagued by delays, from extradition battles to legal challenges, but the preservation order signals that the NPA is tightening the net.
Public Outcry and Political Fallout
The latest asset seizure has reignited public anger over corruption in South Africa. For many, the asbestos scandal is a stark reminder of how state capture robbed ordinary citizens of essential services. Social media has buzzed with reactions, with some praising the NPA’s efforts and others questioning why Magashule was excluded from this order. The Mercedes-Benz G63 AMG, a vehicle worth more than many South Africans earn in a lifetime, has become a lightning rod for frustration over inequality and greed.
Politically, the case remains a hot potato. Magashule, once a powerful ANC figure, was suspended from the party in 2021 and expelled in 2023 after launching a rival faction, the African Congress for Transformation (ACT). He has framed the charges as a political witch-hunt, tied to ANC infighting ahead of the 2022 elective conference. “I’m ready to embarrass the NPA and show there’s no case against me,” he declared in a past interview, maintaining his innocence.
Meanwhile, anti-corruption advocates see the preservation order as a victory, albeit a partial one. They argue that recovering even a fraction of the looted funds could help rebuild trust in government institutions battered by years of graft.
Beyond the Courtroom: New Developments
Recent updates in the case reveal additional layers of complexity. In August 2023, the NPA successfully extradited Moroadi Cholota from the US after a lengthy legal battle. Cholota, who fled to Maryland in 2019, was a key witness turned accused, allegedly holding critical evidence about Magashule’s involvement. Her return has intensified the trial, though her special plea has slowed proceedings.
Another twist came in June 2023, when Edwin Sodi’s luxury mansion in Johannesburg’s affluent Bryanston suburb was identified as part of the assets under scrutiny. While not explicitly named in the R32 million order, it underscores the scale of wealth amassed through the asbestos tender. Sodi, known for his flashy lifestyle and connections to political elites, remains a central figure in the saga.
The Free State government, now under new leadership, has also launched an internal audit to assess the full damage of the asbestos project. Preliminary findings suggest that less than 10% of the promised work was done, leaving thousands of homes with hazardous roofing. This has prompted calls for compensation for affected residents, though funding remains a challenge.
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