Johannesburg - Public Protector Thuli Madonsela will probe the development of a R2 billion town in President Jacob Zuma's home village of Nkandla, her office said on Thursday.
A preliminary investigation by Madonsela had been completed, her spokeswoman Kgalalelo Masibi said.
“(This) simply determines if there is a case to be answered.”
Lobby group AfriForum lodged a complaint with the Public Protector in August 2012, asking her to probe the Umlalazi-Nkandla Smart Growth Centre project, dubbed “Zumaville”.
The planned new town would be constructed 3km from Zuma's private home in Nkandla, KwaZulu-Natal.
The project was the brainchild of Masibambisane, a rural development organisation which Zuma chaired.
Government would reportedly direct more than R1bn of taxpayers' money into the development, while a further R1bn would be raised from the private sector.
AfriForum has claimed that the circumstances amounted to an abuse of power by Zuma because he would personally benefit from the project.
Earlier this year, Madonsela completed her investigation into security upgrades to Zuma's Nkandla home.
She found Zuma and his family unduly benefited from the R246 million upgrades.
Sapa