Special Investigating Unit Freezes Millions in Fraud Case
What Happened?
The Special Investigating Unit (SIU) secured a court order that freezes assets worth more than £16 million belonging to Nhlakanipho Mngomezulu, the director of Lubelo Hlomuka Holdings, which trades as SA Scrum Assembly. The order follows an investigation that found the company illegally collected Temporary Employer/Employee Relief Scheme (TERS) funds meant to help workers during the COVID‑19 pandemic.
How the Fraud Worked
According to the SIU, SA Scrum Assembly received about R16,362,525 from the Unemployment Insurance Fund (UIF) between 2020 and 2022. Investigators say the money was claimed through a “sophisticated fraudulent scheme” that involved:
- Creating fake employee records to justify the TERS payouts.
- Diverting the funds into other bank accounts instead of paying real workers.
- Using the money for personal purchases, such as vehicles and property.
An analysis of bank records showed 45 separate payments from the UIF, with no evidence that any salaries were actually paid to staff.
Assets That Have Been Frozen
The court’s safeguarding order covers several properties and vehicles linked to Mngomezulu and his company, including:
- Houses in Glyndale, Pietermaritzburg and eThekwini.
- Vehicles such as a Volkswagen Caravelle, a Toyota Avanza, a Ford Ranger and a Kia K2700.
- Bank accounts held by both Mngomezulu and SA Scrum Assembly.
The SIU alleges that shortly after receiving the TERS money, Mngomezulu spent large sums on cash purchases of cars and real estate, mostly in KwaZulu‑Natal.
Personal Benefit
Investigators estimate that Mngomezulu personally pocketed more than R5 million from the misappropriated funds. The rest of the money was allegedly moved through a network of accounts to hide its origin, a pattern that looks like money laundering.
Court Action
In November 2025 the SIU asked the Special Court to preserve the assets while it pursues forfeiture. Justice Margaret Victor, president of the Special Court, granted an interim injunction that stops Mngomezulu from selling, transferring, leasing or otherwise dealing with the listed assets until the case is resolved.
Wider Investigation
This case is part of a broader probe authorized by President Cyril Ramaphosa under Proclamation R.8 of 2021, which targets irregular UIF‑TERS payments across the country. The SIU’s mandate is to hold people accountable for stealing public money and to recover funds that were meant to support workers during the pandemic.
What Happens Next?
Any evidence of criminal activity uncovered by the SIU will be referred to the national police for possible prosecution. At the same time, civil proceedings will be launched to recover the losses suffered by the state. The SIU says it will continue to pursue those who abuse pandemic relief programs and ensure the money goes back to those who truly need it.
Conclusion
The freezing of over £16 million in assets shows how seriously the government is taking fraud related to COVID‑19 relief funds. By stopping the suspect from moving his property and money, the SIU aims to preserve what can be returned to the public purse. The case also serves as a warning: attempts to exploit emergency aid will be investigated, and those responsible will face both criminal and civil consequences.
