Shabangu denies fraud claims

Johannesburg - Property tycoon Roux Shabangu on Friday denied a report that he had committed fraud, describing it as unfounded and defamatory.

“As far as the allegations are concerned, I have never, not even in the most desperate times in my business career, have even thought of defrauding my own government, let alone with a non-BEE partner,” Shabangu said in a statement.

“Mr (Johannes) van Niekerk and I were business partners of more than eight years during the conclusion of the Vermeulen contract; we had already jointly built and completed more than five successful shopping malls; I had already built and completed a total of 12 commercial properties by 2008.”

According to a report in The Star newspaper on Friday, the department of public works was taking a former company of Shabangu's to court in an attempt to have a lease signed with him declared void.

The lease, signed on behalf of the department of human settlements, was for the City Forum building at 114 Vermeulen Street, in Pretoria, which was occupied by the Independent Police Investigative Directorate.

In court papers lodged at the High Court in Pretoria, the department of public works alleged that Shabangu fronted for a company, owned by Van Niekerk, and committed fraud by pretending he owned the building for which the lease was being signed.

Public works said it signed the lease with the company Majestic, because it was under the impression the company owned the City Forum building. It subsequently found out that the building had been bought by HMKL 3 Investments a month earlier.

It alleged in the papers that if it had known Van Niekerk owned the building, it would not have signed a nine-year lease, because the company would not have met the requirements of its Black Economic Empowerment (BEE) policy.

According to the report, the department got the special investigating unit (SIU) to investigate the lease agreement.

The SIU found that Shabangu had “misrepresented to the department that Majestic, then a 100 percent BEE company, had full ownership of the City Forum building”.

It also found that “Majestic and its director, Mr NR Shabangu, were a front for HMKL and Mr JPJ van Niekerk, its director”.

Shabangu said he was not given the opportunity to defend himself.

“I was never even informed nor interviewed by the SIU during their investigation into the Vermeulen matter.

“As far as their findings are concerned, I will be taking this matter up with the relevant authorities in due course, in order to determine why this was not the case,” he said.

According to The Star, the department of human settlements did not move into the building, but the department of public works had been paying rent for the past three years.

Shabangu said: “I guess DPW just slept and woke up three years later and realised that they were paying rental to a non-BEE company.

“And Mr Van Niekerk, a 'good citizen' as he is, he just did not see it necessary to inform the department, that he is no longer BEE-compliant.”

Shabangu said he agreed that the department of public works needed to “clean its house, but they must not throw their rubbish into other people’s yards”. - Sapa