The arrest has again threatened the former economic development and tourism MEC’s political future.
He appeared on Wednesday at the Durban Commercial Crimes Court facing fraud, money laundering and corruption charges relating to the festival that never took place - despite R28 million being paid for the event in 2012.
The investigation started in 2013, after a whistle-blower had alerted the authorities.
Francois Rodgers, DA leader at the provincial legislature, said the party was pleased that action was finally being taken.
“For some time now we have been highlighting that millions went into an event that never took place. Justice must play its role.
“If Mabuyakhulu is guilty, then he must face the consequences,” Rodgers said.
The matter had been debated for years at the provincial legislature in Pietermaritzburg, with politicians from all political parties, including the ANC, calling for action.
IFP MPL Blessed Gwala said since 2013 he had been raising the matter, but no action had been taken.
“I was threatened with legal action for calling for accountability. We hope that justice will be served. All those implicated in this matter have to account and repay the money they benefited from illegally,” Gwala said.
The event did not take place, but instead of returning the R28m the money was allegedly shared among a long list of accused, including Mabuyakhulu and former EconomicAffairs HOD Desmond Khalid Golding.
The other accused are directors of companies.
Prosecutor advocate Mlungisi Magwenyana said after the festival had been cancelled, instead of recovering the money, which Golding had deposited to Soft Skills Communications 100 cc, the money had disappeared.
“The R28m was distributed to different companies. All people who got the money have been charged, although others may also be charged.
“The MEC and HOD also got the money, although they did not deserve it, because they worked for the department,” said Magwenyana.
Mabuyakhulu recently made a comeback in the ANC leadership after the party’s national executive committee (NEC) appointed him as convener of the provincial task team (PTT).
The team replaced the provincial executive committee (PEC) which was suspended following its nullification by the Pietermaritzburg High Court.
He had been earmarked to contest against ANC provincial chairperson Sihle Zikalala during the rerun of the provincial conference to take place at the end of April.
When Zikalala took over as ANC provincial chairperson in 2015, he replaced Mabuyakhulu, who was fired as the economic development MEC.
Mabuyakhulu was one of the aggrieved ANC members who rejected the outcome of the provincial conference.
Mabuyakhulu, who is listed as accused 16, together with 15 other co-accused, including companies, appeared before magistrate Christobel Mazibuko.
He, Golding and accused number two, Caesar Walter Mkhize, were released on bail of R50000 each, while Zandile Nonjabulo Mbongwa, Nonhlanhla Brenda Ninela, her husband, Mzwandile Basil Ninela, and Ntokozo Ndlovu were each granted bail of R30 000.
Prominent businessman Mabheleni Leewas Ntuli was granted bail of R30000, although he was not in court.
The case was postponed until April 6.
Mabuyakhulu and former education MEC Peggy Nkonyeni were acquitted of corruption charges in the “Amigos” trial in 2012.
On Wednesday, he smiled as journalists took pictures of him, using their cellphones.
Contacted for comment on Wednesday, Edna Molewa, the ANC member deployed by the NEC to oversee the PTT, said Mabuyakhulu had sent a text message informing her about the news.
She said she was still to establish if this would have an impact on the preparations for the provincial conference.
“I don’t know if we say recuse yourself (Mabuyakhulu), looking at the gravity of the case, but the ANC works on the principle that everyone charged with a criminal offence shall be presumed innocent until proven guilty,” Molewa said.