South African businesses under siege by criminals
Businesses and companies in South Africa’s construction industry continue to be held to ransom by criminal mafias.
What began as isolated incidents of extortion on construction projects have now morphed into a nationwide threat.
Massive delays and even the complete prevention of construction projects are estimated to cost the economy around R68 billion, jeopardising vital infrastructure development.
With this being the not-so-new normal in South Africa, “it is important to understand how the construction mafias operate in order to understand what kind of solutions would be best for ensuring that these syndicates are dealt with,” explained Cliffe Dekker Hofmeyr’s Sentebale Makara and Thobeka Dhlamini.
This was echoed by national project manager of Business Against Crime South Africa (BACSA), Roelof Viljoen who said that ‘construction mafias/extortion groups’ have seemingly become engrained in South Africa, and construction firms need to “plan for the worst.”
Construction mafias are groups who see vital projects, and demand their piece of the pie without using the proper channels.
The State Investigating Unit (SIU) defines them as “extortion groups that typically seek to forcefully extract protection fees from local construction companies and contractors, extort a portion of the cost of an infrastructure project or that specific individuals affiliated with the mafia are recruited to work on the site.”
Makara and Dhlamini said that these mafias target construction sites by coercing site managers or senior staff to meet their demands.
They employ residents, often non-residents posing as locals, to stage protests and disrupt construction, forcing companies to seek legal intervention through the High Court to stop these disruptions.
This strategy conceals the identities of the true perpetrators, complicating efforts to enforce legal remedies.
“Their use of the socio-economic ill of unemployment in the affected communities results in the unemployed being the convenient tool used in disrupting projects,” said Makara and Dhlamini.
The South African government has been attempting to get a grip on this thriving syndicate through the introduction of certain policies and legislation.
This includes the Critical Infrastructure Protection Act 8 of 2019, the National Infrastructure Plan, the Critical Infrastructure Programme and the Infrastructure Built Anti-Corruption Forum.
The new Police and Public Works and Infrastructure ministers, Senzo Mchunu and Dean Macpherson, declared “a war” on the construction mafia.
However, this is easier said than done.
Recent research from the Inclusive Society Institute outlines that “the construction mafia has progressively established political connections, aligning with specific factions within the governing party.”
“This association provides protection and facilitates access to state procurement opportunities,” added the ISI.
“The solution to the construction mafia lies in a multi-pronged approach that addresses the root causes and fosters collaboration,” amongst the community, government and more, said Makara and Dhlamini.
“Construction companies and employers need to prioritise the inclusion of the community in all stages of the project,” they said.
They suggest appointing a respected community leader as a paid Community Liaison Officer (CLO) at the start of a construction project promotes mutual understanding between the community and the construction company.
This can “gain the trust and confidence of the community, and the community will be motivated to protect their interests in the project,” said Makara and Dhlamini.
They said that during the project, construction firms must engage communities by consulting with the CLO, subcontracting work to local businesses, and offering jobs to skilled community members to help prevent disruptions and build community trust.
After the project’s completion, it is important to note that “communities tend to protect what they believe belongs to the community [thus it] is important that construction companies and employers ensure that they incorporate their corporate social investment initiatives in the project’s budget,” said the legal experts.
They suggest that construction companies play a key role in community development by: training locals in construction skills for legitimate employment opportunities; adopting local procurement policies to ensure community benefits; and contributing to community upliftment through school building and feeding programs.
“In the unfortunate case where construction companies, employers and communities are faced with a threat of disruption caused by the construction mafia, affected parties must continue to seek legal recourse through proper channels,” said the legal experts.
In order to get the best outcome, Makara and Dhlamini suggest collating the following when legal recourse is sought:
- Project details: Location, nature, timelines, and contractors involved.
- Information on perpetrators: Details of disturbances and extortion attempts.
- Evidence of threats: Dates, times, and locations.
- Expert reports: Quantity surveyor assessments on project delays or increased costs.
- Incident records: Statements, security logs detailing disturbances.
- Police involvement: Reports filed with SAPS, case numbers, and witness statements.
- Authorized representatives: Channel for handling disturbance incidents and demands.
- Stakeholder engagement records: Communications with local authorities and community leaders.
Report illegal activities impacting construction sites to:
- Local SAPS station.
- National Anti-Corruption Hotline: 0800 701 70.
- Presidential Hotline: 17737 or [email protected].
- Special Investigations Unit.
Read: Construction mafia here to stay in South Africa – be prepared
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