DM168

DM168: DEEP DIVE

The battle for the ground Sol Kerzner used for Wild Coast Sun is still raging

The battle for the ground Sol Kerzner used for Wild Coast Sun is still raging
The entrance to Wild Coast Sun in Port Edward. (Photo: Mlungisi Mbele)

The land was returned to the Umgungundlovu community, which is now embroiled in a fight with the Umgungundlovu Communal Property Association and has accused the association of lining their pockets with money that should have been given to the claimants. The association denies this.

First published in the Daily Maverick 168 weekly newspaper.

There was a time when 117 families of abasuswa (the displaced) were looking forward to attaining the land on which the gigantic Wild Coast Resort and Casino is built.

But now their hopes are shattered. The land-claim recipients are split into two warring factions, many of them living in abject poverty, with allegations that the uMgungundlovu Communal Property Association (MCPA) committee – which was elected a few years ago to advocate for their rights – has gone rogue and is embezzling funds meant for the displaced families.

The MCPA denies the accusations, saying that some community members are being agitated by previous committee members.

A government investigation is trying to get to the bottom of these allegations and the Department of Agriculture, Land Reform and Rural Development (DALRRD) has applied to court to have the MCPA and all the funds it handles put under administration.

In October 2018, government officials, lawyers representing the displaced and executives of Sun International (which owns and runs the Wild Coast Sun Resort and Casino) announced a deal that would see the families being awarded 700ha of land facing the Indian Ocean and become part owners of the Wild Coast Sun Resort and Casino.

Nkosiphendule Malundana outside  his house at not far from Wild Coast Sun. (Photo: Mlungisi Mbele)

Over and above that, the deal meant that the 117 displaced families received R23-million in financial compensation – R98,000 each for the 117 families – and another R27-million to be invested to develop tourism ventures that would provide job and economic opportunities to the community.

This deal also stipulated that the land would be restored to the community as from November 2019 and Sun International would rent the land (on which the casino and resort is built) from the community at R4-million a year – at an escalating rate of 6% a year.The agreement stipulated that the uMgungundlovu land claimants would take a 28.4% shareholding in the casino and resort.

But soon after the funds started rolling in, the community was split into two, with some supporting the MCPA and others accusing it of embezzling funds and illegally paying MCPA members exorbitant salaries.

The families were forcibly displaced in the 1970s after a deal between the late casino mogul Sol Kerzner and the Matanzima brothers, who ruled in the Transkei homeland. They were dumped in the Mzamba communal area and told to fend for themselves. Kerzner fenced the pristine land and built a casino and resort with an 18-hole golf course.

Mtavuna River forms the border between KwaZulu-Natal and the Eastern Cape in South Africa. The river is about 162km long. (Photo: Mlungisi Mbele)

In 1986, Kerzner testified that he had paid a bribe of $1-million to George Matanzima to get the land to build the casino and resort.

Matanzima was arrested and charged with corruption, sentenced to nine years and later pardoned after serving only two years. Kerzner evaded charges and was later pardoned.

The uMgungundlovu community lodged its land claim in 1995. After years of verification and negotiations, a deal was struck in October 2018. President Cyril Ramaphosa was scheduled to make the formal handover in May 2020 but owing to the infighting and threats of violence, the plans were set aside.

Over the years, people were sent from pillar to post to fight for their land, but most have since died, leaving the younger generation to pick up the battle.

Sixty-five-year-old Solifina Vundla remembers when her family and neighbours were displaced. “I had just given birth to my first-born son, who is now 41 years old,” she said. “It was a very painful experience.”

DM168 found Vundla on a hillside a few kilometres from her modest home, which is located about 25km from the casino. She was cutting wood with a bush knife. She said she uses wood to cook for her three grandchildren she supports with her pensioner grant.

Vundla accuses the members of the MCPA committee of using the money meant for the displaced to enrich themselves.

“We have attended countless meetings and empty promises were made. But what hurt me the most is the committee members’ lavish life. Committee members are busy paying themselves thousands of rands every month and we, the people who appointed them, are poor,” she sighed.

“At my age I am supposed to be sitting at home and enjoying my retirement. But look at me, I’m forced to look for firewood because I can’t afford to buy electricity,” she said. “The MCPA members are living large, building big, beautiful houses with our money,” she claimed.

Sophilina Vundla carrying a cane knife inside the forest that’s not far from her house. Vundla says the wood helps them to cook in order to save electricity. (Photo: Mlungisi Mbele)

Vundla and others said the MCPA committee was supposed to pay each of the displaced families R8,000 every two months. This is money paid by Sun International as part of the deal. But families claim this is not happening consistently and that the money is deposited from the MCPA bank accounts into their accounts irregularly. “Whenever they deposit the money, I have to share it with my three unemployed sons,” she said.

Nkosiphendule Malindane, a 39-year-old unemployed man, said his parents died a few years ago without getting a cent in compensation. Whenever the R8,000 was deposited, he had to share it with his two unemployed sisters and brother.

“I was not born when they were forced to move away by the [erstwhile] Transkei Defence Force. But they often told me about the hardship they suffered. Now it is very painful to see people [MCPA members] enriching themselves with the money that was supposed to be given to our families.

“Various projects are held at the Casino and we, the displaced, should benefit but now only few well-connected people are benefiting from these projects,” he said. He said the MCPA’s term of office expired in November 2020, but they were using Covid-19 to dodge calls for meetings to elect new leadership.

“They know that their time has passed but they are ignoring our calls for a meeting to elect new leadership. Some people here are so angry that they are threatening to use violence because they are tired of seeing MCPA members eating our money,” he said.

Elias Ogle, a former member of the land claim committee and head of the Mbizana Development Trust, said there were many things that the MCPA did without consulting with the claimant community.

“There was no community resolution taken to pay the salaries of the MCPA members. There is a lot of funds that have been spent but are unaccounted for. There was no community resolution to make some of the deals with Wild Coast Sun Casino and Resorts. Sun International are our tenants but, due to the deal they signed with the MCPA, they are calling all the shots,” Ogle said, confirming that attempts to call for a meeting to account for the MCPA funds and oust MCPA members have been ignored and sidestepped.

Three women who work around the Wild Coast Sun. (Photo: Mlungisi Mbele)

Skhumbuzo Mchunu, chairperson of the MCPA, admits the committee’s term of office has expired but said Covid-19 restriction prevented the AGM from taking place and another meeting to elect new leadership. He dismissed embezzlement allegations. “The members of the committee are paid for the duties they are doing at the office. The community agreed that the committee must be paid,” he said, declining to reveal the amount committee members were being paid.

“These allegations are made by people who served in the land-claim committee. When they were outvoted they started getting some people in the community to agitate and make allegations that we are eating the money meant for the claimants.

“These people have approached the court several times but their applications have been dismissed with costs. Last year they took us to the High Court in Umtata and that case was also dismissed,” he said.

“The MCPA has not had access to any of the funds of the claimants. Of the R27-million that was awarded by the government, R20-million has been invested with the Investec bank and another R5-million has been invested with the Nedbank money market. We are working hard to get investors to come and invest in the community-owned tourism ventures.”

Mchunu added that they are waiting for the easing of lockdown restrictions so that the new committee could be elected.

Nomfundo Ntloko-Gobodo, chief land claims commissioner, said its mandate was completed after the historic land deal was reached. “Our role ends after a claim has been settled and a viable framework for implementation of a settlement model has been developed as part of a settlement agreement. The uMgungundlovu land claim is a settled matter to which the CRLR has no further mandate.

“At the time [in April 2020] of my last response, the Commission was planning a handover ceremony to officially hand over title deeds for the claimed land to the community. Due to security concerns the said event had to be postponed. Notwithstanding these issues the Commission has ensured that gogos and mkhulus receive their financial compensation payouts and that a copy of the title deed was given to the uMgungundlovu Communal Property Association as proof that the land belongs to its beneficiaries.

“We have thus far paid out more than 95% of the financial award to beneficiaries and continue to engage with other beneficiaries for documentation that will enable us to effect payments for them,” Ntloko-Gobodo added.

A woman comes from the river at Wild Coast Sun. (Photo: Mlungisi Mbele)

The DALRRD had been putting plans in place to resolve the feuds, and hired a legal team to mediate. Department spokesperson Reggie Ngcobo said: “The mediation endeavours employed to resolve a dispute between the members of the MCPA did not succeed due to the failure or refusal of the committee to participate and the department filed an application to Court to place the uMgungundlovu CPA under administration, as the next step towards the dispute resolution, in terms of the Communal Property Associations Act 28 of 1996.

“The application to Court to place the MCPA under administration is at an advanced stage. Placing the uMgungundlovu CPA under administration in order to investigate the complaints, find solutions to the allegations raised against the Committee. [This process will also] give proper guidance to the MCPA and assist with proper management and administration of the MCPA and get the members to fully participate in all the dispute resolution processes, as may be required, towards settlement of the dispute(s).”

Graham Wood, Sun International group COO for hospitality, said his company had honoured its part in the deal and was not involved in any of the disputes. “The land claim has been finalised and Transkei Sun International Proprietary Limited trading as Wild Coast Sun Resort and Casino is leasing the land, on which it operates, from the … MCPA.

“We can also confirm that Wild Coast Sun is indeed honouring agreements in place with the MCPA, but disbursement to the MCPA members is not managed by the Wild Coast Sun. It would be inappropriate for us to comment about alleged disputes relating to beneficiaries of the MCPA, but we can confirm that we are nevertheless complying with all contractual obligations,” he said. DM168

A rival claim for land is made by descendants of Smith family

The uMgungundlovu community in Mzamba is not the only group laying claim to the land where the Wild Coast Sun Resort and Casino is built.

Another claim – which has been rejected  – has been made by the coloured community, who live side by side with the uMgungundlovu community.

The Smiths are descendants of John Gordon Smith, who was born in Scotland but came to settle in SA in the 1800s. Smith later married the daughter of a Pondo chief, Faku Sigcawu. As part of the marriage deal, the Smiths claim, Chief Sigcawu gave the land to his daughter and son-in-law, who farmed the land and raised cattle in the land from the sea to about 16km inland.

The Smiths lay claim to the 750ha of natural bush between Umtamvuna and Mzamba with a view of the Indian Ocean. The current generation of Smiths showed DM168 documents confirming that Gordon Smith paid taxes for the land until he died in September 1910. His descendants continued to pay taxes until the 1950s.

Grace Smith-Smale (78) is the fourth generation of the Smith clan. She said theirs is the only legitimate claim because the members of the uMgungundlovu community only settled in the area after the 1960s.

“We have proof that this land is ours and we got plans and documentary proof that our forefathers paid taxes for this land,” she said.

Sharmane Underhill (67), also a descendant, said their community felt insulted that their claim remained unresolved.

Desiree Smith (54) is another descendant who is also on the steering committee handling the land claim. She said in 1998 the Smiths lodged a land claim with the Eastern Cape land claim commission before the 1998 land claim deadline, but had heard nothing further.

“We have given the land claim commission all the documentary proof that this land belonged to our great-grandmother and great-grandfather. We have been trying to get information – even our lawyer has tried – but they are giving us a runaround.”

Enerst Smale with his wife Grace Smith-Smale. Grace is one of the victims who is clamming the land back. (Photo: Mlungisi Mbele)

A map showing a plot of the land that belongs to some of the family members in the area. (Photo: Mlungisi Mbele)

The Commission on Restitution of Land Rights (CRLR) admits that the Smiths lodged their land claim in the 1990s, but said they did not provide additional information and therefore  their claim was dismissed.

Nomfundo Ntloko-Gobodo, chief land claim commissioner, said: “The Office of the Regional Land Claims Commissioner: Eastern Cape has written to the family on a few occasions, initially to request further information to support their claim and later to inform them that their claim was dismissed because it did not meet the requirements of Section 2(1) of the Restitution of Land Rights Act of 1994. To this end our investigation findings show that the Smith family dispossession occurred prior to 19 June 1913.

She said some Smith family members were part of the CPA and had received compensation via that community claim.

“In a case where a land claim is dismissed by the Commission on Restitution of Land Rights, a claimant may approach the Land Claims Court for a review of our decision. The uMgungundlovu Community land claim was referred to court and was settled as part of a court-ordered settlement. The Smith family was aware of this court case and could have at any time contested the settlement of the claim in the Land Claims Court,” Ntloko-Gobodo said.

Adrian Krige, the lawyer representing the Smith family, said the Land Claims Commission erred in rejecting and deregistering the claims without duly considering all the evidence available.

He added that the Smiths’ written representations to the Commission on Restitution of Land Rights detailed extensively the background of the land claim from the allocation of about 6,000 hectares of land to John Gordon Smith by Chief Faku of the amaPondo prior to the Chief’s death in 1867 to the Smith family’s dispossession and the submission of the land claim by Mr W Smith. “Our client shall be pursuing its claim in the appropriate forums including, inter alia, referring the matter to the Land Claims Court,” Krige said in a statement. DM168

Bantu Holomisa was expelled from ANC for speaking out about dodgy deals

The Wild Coast land issue is partly responsible for the firing of former Transkei military leader and now United Democratic Movement leader Bantu Holomisa from the ruling ANC and a possible shot at leading the country.

Holomisa was the major-general of the homeland Transkei Defence Force and came to power in 1987 when he toppled the then Transkei prime minister Stella Sigcau. He was to lead the homeland until April 1994 when South Africa held its first non-racial, multi-party elections.

In 1994 Holomisa was elected to the National Executive Committee (NEC) of the African National Congress. After the elections he was appointed deputy minister of environment and tourism in the Mandela administration.

But after going to testify before the Truth and Reconciliation Commission (TRC), Stella Sigcau, who was serving as the minister of state enterprise, detailed how she had received a R50,000 bribe from Sol Kerzner as part of the Wild Coast land and casino deal.

Before testifying, he had been warned by ANC leaders not to approach the TRC. He defied the order and testified. After that he was expelled from the ANC on 30 September 1996 and also lost his position as the deputy minister.

He went on to form the UDM with Roelf Meyer, who had been dismissed from the National Party for flouting its rules. Meyer later quit politics and Holomisa still leads the UDM in the opposition benches in the National Assembly.

Holomisa said his testimony was later vindicated by Sol Kerzner himself, who admitted to paying bribes to Transkei leaders, including the Matanzima brothers and Sigcau.

“In hindsight, I think I was naive to go to the TRC. But I was still new in the ANC and I didn’t understand their culture. When we came to power in the Transkei we were primed to fight corruption in the government; that is, in my years in charge of the Transkei not a single minister was fingered in corruption.

“If I was not fired perhaps I could be in the ANC. Maybe I would be part of one or the other of the factions. I don’t know how my career would have panned out,” he told DM168.

Holomisa added that the uMgungundlovu community is right to claim their land back. “The deal with Sol Kerzner was corrupt and rotten to the core. Many people were bribed and people lost their land,” he said. DM168

Timeline: A history of the land on which the Wild Coast Sun Resort and Casino is built

1971: The Transkei homeland was given independence by the South African apartheid government under Prime Minister Chief Kaiser Daliwonga Matanzima. This independent state was proclaimed in 1976.

1979: Chief Matanzima signed a land lease deal with Sun International founder and casino mogul Sol Kerzner – the deal allowed Kerzner to build the Wild Coast Sun Resort and Casino on the 430ha of land. This deal was followed by members of the Transkei Defence Force forcibly removing people to make way for the casino. The deal was later found to have been sweetened with a bribe to Matanzima and other members of the Transkei government, including Stella Sigcau.

1979: KD Matanzima appointed himself president of Transkei and elevated his brother, George Matanzima, to the position of prime minister of Transkei. George served as prime minister from 20 February 1979 to 24 September 1987 when he was ousted in a military coup.

1987: George served as prime minister until 1987 when he was ousted in the military coup. He was replaced by Stella Sigcau, who was again toppled by Major- General Holomisa, who accused her of corruption.

1987: After being ousted from power, George Matanzima was investigated and charged for allegedly accepting $500,000 in kickbacks from a Lebanese businessman who needed to secure a housing contract in the Transkei. Further claims were made that South African business tycoon Sol Kerzner paid Matanzima and some members of his cabinet R2-million in order to secure exclusive gambling rights in the Transkei.

1989: George Matanzima initially fled to South Africa and then Austria, but after the South African government gave him assurance that he would not be arrested, he returned to the country. After briefly avoiding prosecution, George Matanzima handed himself over to authorities. He was sentenced to nine years in prison for his role in this scandal. After serving three years of his sentence he was pardoned and released. Sol Kerzner, who admitted to the bribery claim, mysteriously avoided prosecution until he died of cancer in March 2020.

1994: South Africa held free and fair elections and a new, ANC-led government took over, and the homeland governments were scrapped.

1996: Bantu Holomisa, the former military leader of Transkei, went to testify before the Truth and Reconciliation Commission, saying that Stella Sigcau, who was serving as the minister of state enterprise, had received a R50,000 bribe from Sol Kerzner as part of the Wild Coast land and casino deal. After testifying Holomisa was expelled from the ANC on 30 September 1996 and also lost his position as the deputy minister.

1996: The uMgungundlovu community lodged the Wild Coast land claim for the 700ha land, which includes the 430ha on which the Wild Coast Sun Resort and Casino is built.

2000: George Matanzima died at Queenstown’s Frontier Hospital after a long battle with hypertension and renal failure.

2018: The uMgungundlovu community was awarded a 700ha land claim that includes the 430ha on which the Wild Coast Sun Resort and Casino are built. The deal also stipulated that Sun International will continue to lease the land from the community and the community will also be minority shareholders in the complex. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper which is available for R25 at Pick n Pay, Exclusive Books and airport bookstores. For your nearest stockist, please click here.

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Comments - Please in order to comment.

  • Vijay Pillay says:

    The Wild Coast Sun was built by Holiday Inn when Charles Fiddian-Green was chairman.
    It opened for business in December 1981. Holiday Inn was taken over by Southern Sun (a SAB subsidiary run by Kerzner) in 1985, with the latter being eventually swallowed up by Sun International.
    How is it possible for Kerzner to bribe someone for the site, when the casino was built and operated by a rival?

    • Lesley Young says:

      There is quite a bit more to this story. The bribe money did not come from Sol Kerzner pocket, but the controlling boards of the conglomerates involved who had to approve such payments. But ever since then Sol has been made the ‘fall guy’ by the media.

    • Rod H MacLeod says:

      Holiday Inn built a resort in 1981. Sun took over in 1985. In 1992 Sol Kerzner “bought” the exclusive Transkei gambling rights from Matanzima for R2 million cash in pocket, R2,500 a month rental, and the Matanzimas removed locals from the 600 – 700 hectare site that partially became the golf course.

      When a man confesses without duress to paying a bribe, how on earth does one figure one knows better?

      • Vijay Pillay says:

        The forced removal of the locals by Mantamzima was done in the early 1980’s prior to the building of the Holiday Inn casino. Sol Kerzner’s bribe came later in 1986 and was for exclusive gambling rights in the former Transkei.

  • Tony Reilly says:

    Never ending story throughout rural South Africa ……community infighting, numerous interest groups, accusations and mismanagement……..all resulting in zero progress and cancelled projects.

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