Ben Ngubane faces criminal charges

The criminal complaint includes charges of fraud, forgery, uttering and contravention of provisions of the Companies Act, and arises from Ngubane and his wife borrowing R50 million from a state-owned company and failing to repay it.

The Organisation Undoing Tax Abuse (OUTA) has investigated Ngubane on a variety of matters arising from his tenure on the boards of  Eskom and the SABC, and also followed up on a recent Carte Blanche investigation which exposed irregular activities within the mining sector. “We have obtained evidence to substantiate our claims and are confident of the strength of our case against Ngubane,” says Ted Blom, portfolio director for energy at OUTA.

In essence, Ngubane and his wife, Sheila Ngubane, are the sole shareholders and directors of Huntrex 305 (Pty) Ltd, which in turn owns the companies Zululand Quarries (Pty) Ltd, Natal Sands (Pty) Ltd and Hanis Investments (Pty) Ltd. Zululand Quarries and Natal Sands had certain mining rights. In order to finance the purchase of these companies, Huntrex obtained a loan of R50 million from Ithala Development Finance Corporation Ltd, a KwaZulu-Natal state-owned company which sole purpose is to finance the development of previously disadvantaged communities.

Huntrex defaulted on the loan repayments and was liquidated following an application by Ithala, its biggest creditor. In an attempt to obtain capital to pay some of the creditors, the liquidators brokered a deal to sell all three companies Huntrex owned to Sandton Plant Hire for R15 million. The mining rights owned by Zululand Quarries and Natal Sands formed the cornerstone of this agreement with Sandton Plant Hire.

However, Ngubane produced share certificates indicating that he and his wife were the only shareholders in Zululand Quarries, Natal Sands and Hanis Investments and thus ultimately the owners of all mining rights those businesses owned. This meant that the liquidators could not sell the companies so the sale was cancelled.

“Based on the investigation and evidence obtained by OUTA, it is clear that the share certificates produced by Dr Ngubane were fraudulent as there are several blatant mistakes made on them,” says Blom.

“We are confident in the evidence laid by OUTA before the authorities and we will keep a close eye on the investigation and prosecution process. We trust that the police and the NPA will take up this matter with the urgency and sincerity it deserves.”

The affidavit outlining the case is here.