21 July 2024 | 12:50 AM

How Malema amassed his millions

Key Takeaways

Julius Malema’s Achilles heel — the focus of investigations by the South African Revenue Service and others — is his wide-ranging business interests built on his early success in helping to clinch lucrative government tenders.

The ousted ANC Youth League leader’s success in business and tenderpreneurial activity can be traced back to Segwalo Consulting Engineers CC, which was founded by Lesiba Gwangwa in Polokwane a decade ago.

Malema’s involvement with the firm began in 2004 when he was introduced to Gwangwa as a potential facilitator of government contracts, allegedly in return for a 10% commission on the value of each tender.

Malema, 24 at the time and the newly elected secretary of the youth league in Limpopo, has denied getting kickbacks for contracts.

Over the next few years Segwalo, which traded as SGL Consulting Engineers, turned over hundreds of millions of rand in municipal contract work, allegedly owing largely to Malema’s skills.

The tender flow increased with the change of government in 2009, by which time Malema had acquired a 70% stake in SGL.

Blue Nightingale

By then he had been linked to a number of companies operating in Limpopo. In 2005, through a shelf company called Blue Nightingale Trading 61, he was allegedly cut into a R200-million waste-management deal with the provincial government. He allegedly received payouts for the following five years on the shelf company’s 3% share. Malema has refused to confirm this.

Ever Roaring Investments, of which he became a director in 2005, was part of a consortium that supplied medicines and equipment to state health facilities in Limpopo. In 2006 he was appointed a director of Ngape Mining Investments, about which little is known.

The following year he started a company called 101 JunJus — “that’s what Pule [Mabe] used to call me”, he once said — though little is known about its dealings either.

Later in 2007, on the eve of the ANC conference in Polokwane, he started setting up the Ratanang family trust, which was registered in May 2008. Named after his only child, it was to become the most controversial of his investment vehicles.

By then Malema had begun to dabble in property. In 2006 he bought a residential site, released by the Polokwane municipality, for R222 000 — and sold it six months later for R680 000.

A year later he bought his first house in the city’s modest suburb of Flora Park for R1-million with a bank bond that has since been cleared.

Moved to Jo’burg

In 2008, when Malema became president of the youth league, he moved to Johannesburg and in April 2009 signed a lease on a house in upmarket Sandown for R18 000 a month. He paid a year’s rent upfront and bought the house four months later for R3.6-million.

Only R1.5-million of this amount was bonded and Malema has acknowledged that “donors” helped to pay the balance.

In September 2009 Gwangwa was appointed director of On-Point Engineers, through which he filed a winning bid days later for a contract with the Limpopo roads and transport department to administer the bulk of its R4.6-billion budget over the next three years.

The Mail & Guardian would later expose how On-Point doled out multi-million-rand contracts allegedly to political allies, friends and family and allegedly demanded that recipients be cut into the contracts — kickbacks, in effect.

On-Point denied at the time that it had dished out “any tenders”. And although Malema admitted in an interview with the M&G that he partly owned On-Point through the Ratanang family trust, he insisted he was not involved in its operations.

Awaiting dividends

“I just queue when the dividends are due,” he said. At the peak of the company’s activities, dividends running into tens of thousands of rands and more were paid to him every month.

The roads department is now under investigation by auditors PricewaterhouseCoopers on behalf of the treasury and On-Point is being probed by the public protector, the Hawks and the special investigating unit.

City Press last year blew the lid on how Malema allegedly used the Ratanang trust as a “slush fund” on the back of evidence from a businessman who claimed he had paid R200 000 into one of its accounts in return for a contract. Malema claimed the donations were for “charitable” purposes, not kickbacks.

In 2010 alone, more than R3-million was reportedly channelled through the trust, R2-million of which was in cash — a factor frustrating the efforts of investigators in their attempts to trace the sources.

Millionaire David Mabilu, who flew Malema and his friends to Mauritius in October for his wedding bash, has also been named as a benefactor, as has Tokyo Sexwale, through his company Mvelephanda Holdings.

The M&G has reported rumours that Sexwale bailed Malema out for millions in tax owed to the receiver of revenue, although Malema and Sexwale have denied this.


Malema has also been linked to a set of controversial contracts worth R314-million awarded last year by the Limpopo health department that involved a cousin, Tshepo Malema, and several associates.

The contract was later frozen amid indications of fraud, although the M&G later showed how Malema pressured health department staff to pay out regardless. It is not clear whether Malema, who denied intervening, stood to benefit from the deal.

The savvy tenderpreneur’s Polokwane property portfolio expanded between late 2009 and mid-2011 when he purchased two farms, a luxury double-storey house and a modest bungalow at a combined price tag of more than R9-million.

Some of the properties were bought through Gwama Properties, a company he partly owns through the Ratanang trust.

The scrutiny of Malema’s affairs increased last year after he had his Sandown home demolished and began to build a three-storey mansion in its place. According to Malema’s architect, it would cost about R8.5-million. He has also carried out extensive work on his grandmother’s home in Seshego.

Coffers dry

The construction on his Sandown mansion came to a halt earlier this year when his coffers allegedly ran dry and the net of various investigations into his affairs began to tighten.

The revenue service has subsequently subpoenaed a number of Limpopo businesspeople to an inquiry into 19 companies to which they believe Malema is linked.

They are likely to include Gwangwa of SGL and On-Point, his cousin Tshepo, businessman Steve Bosch, who reportedly contributed R1.2-million to Malema’s Sandown mansion renovation (although both denied it), property developer Matome Hlabioa, who provided Malema with luxury cars, property developer and wedding host Mabilu, tycoon Mohamed Dada, in whose jet Malema has flown, and Malema’s friend Nthabiseng Ntshangase, who had a share in the R314-million Limpopo health contracts.

The public protector is due to release her draft findings in the coming weeks and although she is expected to nail On-Point, it is not certain what she may find on Malema. Although the Hawks investigation has apparently slowed down, the PricewaterhouseCoopers probe is gaining ground, but it is not known when its work will conclude.

Fiona Forde is the author of “An Inconvenient Youth: Julius Malema and the ‘New’ ANC”

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The M&G Centre for Investigative Journalism, supported by M&G Media and the Open Society Foundation for South Africa, produced this story. All views are the centre’s. www.amabhungane.co.za.

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