R24 million – that’s what Sibusiso “Deebo” Mzobe, the embattled cousin of President Jacob Zuma, was paid by Mkhondo Municipality, in Mpumalanga, for his role in a low-cost housing project.
Mzobe is now being sued for R7m in his personal capacity by the frustrated subcontractor that did the work, Rubro Building.
Rubro, which says it has been struggling to get the money out of Mzobe’s company, Deebo Holdings, successfully liquidated the firm last week.
The Sunday Tribune has established that the subsidised housing contract was awarded to Deebo Holdings, which simply subcontracted the work and garnered a substantial fee for doing “nothing”.
Mzobe is tipped to turn Zuma’s sleepy home town of Nkandla into a R2 billion “smart village”.
Following the liquidation of Deebo Holdings on Tuesday, Charmaine Schwenn, attorney for Rubro, said that her clients were now suing Mzobe in his personal capacity.
“Our papers are at the Pietermaritzburg High Court for the sum owed to my client.”
The exact nature of the action cannot be disclosed until the court papers are served on Mzobe.
While Mzobe is being pursued for R7m and denies any involvement in payment procedures, Mpumalanga housing spokesman Freddy Ngobe said on Friday that Deebo Holdings had been paid R24.4m for the project.
“We paid the service provider for the project. Let’s not go into the technical questions. We paid Deebo Construction,” Ngobe said.
After winning the contract in 2011, Mzobe’s Deebo Holdings CC subcontracted Durban-based Rubro Building to build 400 low-cost houses in the strife-torn Mkhondo Local Municipality in Mpumalanga.
But, according to papers lodged at the Durban High Court by Rubro managing director Charl Roux, Deebo Holdings never paid in full, despite several letters of demand.
Ngobe said 319 units had been built in the Mangosuthu informal settlement, while 81 were yet to be constructed.
Earlier this month, residents of Ethandakukhanya township in Piet Retief, under Mkhondo, set fire to a local clinic and a truck, as well as barricaded roads leading to the township. Among their complaints was the lack of service delivery.
Mzobe is the deputy chairman of the Masibambisane Rural Development Trust and is listed as an active director of 24 companies in construction and consulting. The trust, chaired by Zuma, is spearheading the establishment of “Zumaville” – the R2bn Nkandla/Mlalazi smart town near Nkandla. The project was “on track”, with construction due to begin later this year, Mzobe said.
Despite Zuma taking centre stage at Mzobe’s wedding in Mbongolwane, Eshowe, three weeks ago, and enthralling guests with his Zulu dancing, Mzobe denies the tender was awarded though his patronage – or that he pocketed the money.
Mzobe described himself as “only a distant relative” of the president, and not his cousin, as was often reported.
“In terms of the family tree, my father would be considered Nxamalala’s (Zuma’s) cousin.”
Mzobe said: “I don’t know why the media must always mention my name with the president’s… I don’t know why you must drag Nxamalala’s name into my affairs. I do what I do for myself. If I make mistakes, they are made by me, no one else.”
Rubbishing claims he had pocketed the money meant to be paid to Rubro, he pointed an accusatory finger at Stedone Civils, which his company is aligned to.
Mzobe said: “The money was put into a big pot that involves other projects. (Deebo Holdings) is a subsidiary of Stedone. We’re talking about a group here which has many managers. I can’t say what happened in the project… I just heard there was a court process. I haven’t received a call from the owner to say he has a problem and to see how we can fix it.
“There’s a finance department. As a result, I’ve never even seen documents to say I subconstructed it. I never signed any documents for this project. Since I’ve never signed a contract, there’s no way I’d know who’s owed money. I was not involved. I’ve never seen these people. They’ve never spoken to me.”
Asked to explain his role in the deal, Mzobe said: “The project was awarded to a company that belongs to me.”
And what role did he play beyond that? Mzobe responded: “Nothing.”
Asked why Rubro was seeking to recover only R7m when R24.4 had been paid to him, Mzobe said: “You’ll have to find out from them.”
In his affidavit, Roux said that, owing to frustration at not receiving payment, he had met three directors of Stedone – Brian Bell, Bryant van der Merwe and Fritz Ackermann – in September.
Roux said he was told the money had been paid by the municipality, where a payment plan was discussed, although its terms were never finalised and accepted by the parties.
Roux said: “The only response thus far is a telephone call from Gordon de Beer, an attorney at GH de Beer Attorneys, wherein he informed the applicants’ attorneys that he acts for Stedone and the respondent, the respondent is in financial difficulty, and a payment plan was proposed.”
Asked about a way forward, Mzobe said: “It’s hard to see what will happen. But we have to respect the process that has unfolded. I will also be doing an investigation to find out exactly what happened.”
Describing himself as a self-taught businessman who once sold sandwiches at school, later setting up spaza shops in Umlazi, before venturing into construction after 1994,
Mzobe said he was angered by constant reports he had piggybacked on Zuma.
“It is the media’s creation that what I have is because of him. And I don’t have much… I’ve never had money. I survive like everyone else.
“I don’t know what I have. Since I was born, I’ve been in business. I’ve never been employed. There are lots of things I’ve done – some successful, others not. I don’t see what business I can trade that links me to Nxamalala (Zuma).
“The Masibambisane programme – I was running it by the time Nxamalala came. There’s no way I can benefit personally from it.
“Masibambisane formed to encourage people to use land to sustain themselves. The president and I are from the same area. We talk to him a lot. In my family, we’ve always believed in agriculture. I bought two tractors, and Zuma said: ‘This is good. Can we not help others benefit from it?’ He put two other tractors, and I said: ‘I’ll put another three.’
We even paid a woman from our own pockets to administrate.
“We like giving you support… Let us work with you. The partnership came about that way.”
In an application against Zuma’s son, Edward, involving the R1.5m he owed to his wedding planner, documents were put forward purportedly showing that Deebo Holdings owed Edward R28.8m.
Asked to comment, Mzobe said: “There’s no such thing. It’s never been the case.”
Stedone Civils’ operations manager, Ackermann, declined to comment yesterday, other than to say he would hold meetings with Mzobe to iron out the matter internally.
“One of our directors had made contact with Deebo and was requested not to comment… We want to address the issue first,” he said.
Public Service Accountability Monitor spokesman Paul Hoffman said that, in terms of the constitution, the awarding of all state contracts needed to be cost-effective.
“If this individual secured the state tender by misrepresenting his company’s capabilities during the tender process, and then simply gave the work to someone else for a fee, that amounts to fraud,” he said.
He called for Mzobe’s business dealings to be probed by the Hawks and the public protector.
“Where the Hawks fail to bring politically connected people to book, the public protector can be relied upon.”
What Deebo owns
According to publicly available documents, Sibusiso Lucas Mzobe, a relative of President Jacob Zuma, holds directorships in 24 active companies. They include:
The Sunday Tribune