Edwin Sodi (Photo: X)
The Free State High Court has granted an order that six luxury properties and a Mercedes-Benz G63 AMG worth around R32 million from the controversial businessman Edwin Sodi be declared forfeited.
Kaizer Kganyago, spokesperson for the National Prosecuting Authority (NPA), says they welcome the order, which was granted in terms of the Prevention of Organized Crime Act (POCA) in favor of the National Director of Public Prosecutions (NDPP).
The case arises from the controversial asbestos roof tender awarded in October 2014, where a joint venture between Diamond Hill Trading 71 and Blackhead Consulting was irregularly awarded without following proper procurement processes. Although the contract was worth approximately R255 million, most of the work was not carried out. Instead, the contract was outsourced at significantly reduced amounts, with only a fraction of the funds reaching the final service provider. Evidence before the court showed that nearly R230 million was paid out by the department, with the bulk of the funds diverted through various entities, personal accounts and trusts, and ultimately used to purchase luxury assets.
Predominance of improbabilities
Kganyago says the court found on a balance of probabilities that the assets represent the proceeds of illegal activities, which include fraud, corruption, theft, breaches of the Public Financial Management Act (PFMA) and money laundering. The court further found that the properties and vehicle were instruments used in the commission of money laundering offenses related to the irregular Free State asbestos roof tender of R230 million.
“This forfeiture order must be distinguished from a forfeiture order in terms of the Criminal Procedure Act, where a conviction is a requirement and is civil in nature. Such an order allows the state to recover money or assets obtained from crime after conviction.
“The respondents in the forfeiture application failed to prove an innocent owner defence, as they only raised a mere denial, without credible evidence showing a legitimate source of funding for the acquisition of the assets in question. Therefore, the final forfeiture order was granted in favor of the state,” says Kganyago.
The forfeited assets include luxury properties in Sandton, Hartbeespoort, Wonderboom, Randburg and Parys as well as the Mercedes which was bought in cash.
Registered under various trusts
According to Kganyago, the assets are registered under various trusts, which are linked to individuals who were involved in the asbestos tender. These include the McGina Property Trust, the Villa Castello Residence Trust and the SAB Family Trust. “The national director of prosecutions traced the flow of funds from the Free State Department of Human Settlements, directly after the acquisition of these assets.”
Edward Sodi’s Mercedes Benz G63 AMG. (Photo: Provided)
According to the NDOV, detailed financial investigations revealed classic money laundering patterns involving placement, concealment and integration of illicit funds. Large sums were transferred almost immediately after receipt from the department to related companies and individuals under the guise of legitimate services, before being distributed through complex financial channels and used to purchase real estate and luxury vehicles in cash.
The court rejected a technical defense put forward by the respondents regarding the expiry of the custody order and the existence of parallel criminal proceedings. The court confirmed that all procedural requirements have been met and civil forfeiture proceedings are not hindered by pending criminal cases.
Important milestone
Kganyago says the forfeiture represents an important milestone in the wider investigation into the asbestos tender and forms part of ongoing efforts to recover proceeds of crime.
The order ensures that the forfeited assets will go to the state, be sold, and that the proceeds will be deposited into the criminal asset recovery account to support law enforcement efforts and benefit affected communities. The NPA says no individual should benefit from the proceeds of crime. This outcome reinforces the role of the Asset Forfeiture Unit (AFU) in the detection, preservation and forfeiture of assets obtained from illegal activities. “This ensures that crime networks are disrupted and stolen resources are returned to the people of South Africa.”
Adv. Andy Mothibi, the NDPO, praised the strong and coordinated working relationship between the NPA, the priority crime investigation directorate, or the Falcons, and the Special Investigation Unit (SUE).