SIU investigation: property scam has left more than 20 Phoenix residents 'homeless'

MORE than 20 Phoenix residents are demanding accountability after allegedly paying their life savings to a property developer implicated in Special Investigation Unit (SIU) report.

The report revealed irregular land sales and corrupt relationships between developers and municipal officials.

The residents claimed they had paid hundreds of thousands of rands but have not received completed homes or transfers, despite court orders.

The residents said they had approached one of the developers whose name was mentioned in the SIU report (the developer’s name is known to the POST) to purchase properties. 

They said the developer has failed to deliver on the houses, ignored court orders, and resold properties.

The residents have since opened criminal cases and laid complaints with the SIU and the office of the eThekwini Mayor.

Thasmeena Moola, 46, said the dream of owning a home turned into a “nightmare”.

She said in 2018 she paid a R300 000 deposit for a home in Longcroft. 

Moola said the balance was due on completion.

However,  she said the house “took years to build”, and the family later discovered that the building plans were not approved.

“We asked for our money back in 2022 because the developer did not keep to the agreement.  We later found out that the house was eventually completed and then sold to someone else, who has been living there for over a year.”

Moola said she sought the help of an attorney and approached the Durban Magistrate’s Court. 

“Following the court action the developer signed an agreement to reimburse the full amount with interest, but has not paid a cent to date. I repeatedly call the developer’s office but no one answers. I send emails almost daily begging and pleading for my money. But there is no response.” 

Moola said she has since opened multiple cases, including contempt of court and fraud. 

“I am often sick and suffer with headaches due to stress. My entire life is at a standstill because of this thief.”

Moola, who has two children aged 22 and 19 added that she and her family are now confined to a two-bedroom flat. 

“This house was our dream. My children have been robbed of having their own bedrooms. I have also been crippled financially, because all of my savings are gone.”

Ashena Malek, 44, said in 2018 she paid R553 329.90 toward a house in Foresthaven after being promised occupation within six months. 

She said her father, 69, who was employed by the eThekwini Municipality, used his pension fund money to assist her in purchasing the house. 

“When I looked at the building plans, it was everything I dreamt of. However, soon after the building started it just stopped. It was just the foundation and walls that were done. .

“The developer then repeatedly demanded extra payments. They needed R150 000 more for the roof, R15 500 for electricity connection and additional funds to repair vandalism. What choice did I have? I wanted a home so I paid. But it became years of empty promises and no progress,” she said. 

Malek said she confronted the developer in October 2023. 

“The developer admitted the plans were never approved, and would never be approved. At that moment I knew I had been scammed. I immediately cancelled the agreement and demanded a refund. I was told to send an email and would be paid within two weeks, but it is now more than two years later. My calls are ignored daily.” 

Malek, who has a daughter, aged 11, said she was now forced to rent.  

“It was my mom’s dying wish that I own my own home. I just want what’s rightfully mine. I want my house or my dad’s hard-earned money to be returned.” 

Richard Govender, 58, said he paid R550 000 to purchase a home for his daughter in 2017. 

He said following the payment he expected the home to be transferred but it never happened. 

“The house was built but it was never transferred. Suddenly, we received an eviction letter.”

Govender said in addition, water was supplied through bulk meters and residents were billed exorbitantly. 

“I found out that the development was never passed by inspectors and water meters installed underhandedly this year. I am now demanding that the property be transferred and that interest removed from the municipal bills because this is not my fault.” 

Padi Alaraju, 67, said she and four relatives collectively paid more than R2 million for plots of land in 2018.

“We wanted retirement homes. Together, my husband Paul and I, wanted to purchase a stepless house for our old age. My sisters and nephew also bought plots. We paid R500 000 each. The developer told us construction would begin immediately, but nothing has happened in the past seven years.”

Alaraju said after years of silence, unanswered calls, and legal fees, she discovered there were scores of victims.

“I was shocked by how many people had fallen into this developer’s trap. We have all opened fraud cases and hope that the developer is finally charged.”

Claude Chinniah, 48, said he had approached the developer in 2015 and has signed four different sales agreements over the years.

“However, every time the house was nearly completed, it was sold to a cash buyer. I eventually paid a R150 000 deposit for a unit in Fiddlewood, only to have that sold off as well.”

Chinniah said he only received R80 000 back, despite repeated efforts by three attorneys and debt collectors.

“My attorney eventually told me that that developer has influential connections and pursuing the matter further would be financially impossible.”

Raj Balraj, 63, said he paid R500 000 for a home in Clearhaven in 2016. 

He said he thereafter paid an additional R100 000 for roofing. 

“However, the land had issues and the plans were not passed. Due to the construction being stopped, the windows and copper pipes were stolen.”

Balraj said his dream to have his own home was halted. 

“I just wanted my son and his family to live with us, but now we only have stress and no money. I have suffered two heart attacks due to the stress. ”

Balraj said daily calls to the developer went unanswered. 

“It is devastating as more than 20 people have lost their hard-earned money. This is a moral, financial, emotional, and physical injustice. We are exhausted, emotionally broken and financially ruined. But we refuse to be silent, we will expose everything.”

The Special Investigation Unit (SIU) released a report into their investigation on the maladministration in the affairs of the eThekwini Municipality in August this year.  

The report revealed several irregularities in relation to the sale and purchase of various municipal-owned land including community parks and sport grounds in Phoenix. 

According to the 41-page report, around the year 2000, the municipality took a policy decision to utilise various vacant sites called “infill sites” for the purposes of facilitating housing development for the  affordable market population within the eThekwini operational area. 

The infill sites were previously vacant and comprised municipal-land dispersed in various parts of Phoenix. 

According to its findings, the SIU revealed that it found that the disposal of or alienation by the municipality did not comply with the provisions of the Constitution of the Republic of South Africa, Act 108 of 1996, the Municipal Finance Management Act 58 of 2003, and the municipality's Supply Chain Management (SCM) Policy. 

In addition, the SIU found that the appointment of developers, Lady Brick Block Property Developments trading as Woodglaze Trading (Pty) Ltd, Madupha Business Enterprise CC and Ready Homes CC was made in contravention of the SCM legislation and prescripts. 

The investigation further revealed that the allocation of sites to developers was contrary to the intended purpose of the IHP, thereby constituting irregular and unlawful conduct by the officials who failed to follow the municipality's SCM processes. 

“A corrupt relationship between the developers and the officials who received undue gratification in the form of financial benefit for their unlawful conduct,” it read. 

The SIU in its report, said it had finalised its internal processes to refer the matter for civil litigation in the Special Tribunal. 

“The SIU will seek to recover losses suffered by the municipality by instituting civil litigation.” 

POST