South Africa

SCORPIO

Royal Security — founded by State Capture ‘kingpin’ Roy Moodley — bags R282m contract in DA-led Western Cape

Royal Security — founded by State Capture ‘kingpin’ Roy Moodley — bags R282m contract in DA-led Western Cape
Illustrative image | Former president Jacob Zuma. (Photo: Gallo Images) | Roy Moodley during a Sanco rally at the Curries Fountain Stadium on 13 April 2014 in Durban, South Africa. (Photo: Gallo Images / Sowetan / Thuli Dlamini) | Gallo Images / Die Burger / Jaco Marais | Western Cape Government logo. (Image: Supplied)

Durban businessman Roy Moodley is associated with some of South Africa’s most egregious State Capture scandals. This hasn’t stopped the DA-led Western Cape provincial government from awarding a R282m contract to the controversial security firm Moodley founded.

A security company founded by controversial ANC-linked businessman Chockalingam “Roy” Moodley has won a R282-million security contract from the Western Cape Department of Infrastructure.

The contract awarded to Royal Security is for security services over a period of two years at immovable assets owned by the Western Cape provincial government. 

A letter sent by the Department of Infrastructure to losing bidders, dated 1 June 2023, confirms Royal Security’s recent appointment.

According to a list of bids received by the department, no less than six rival bidders had submitted a lower bid price than Royal Security’s offer of R282-million.

The department told Daily Maverick that 10 of the 14 bids were disqualified because they did not meet the minimum score for functionality. 

Among the four remaining bidders, Royal Security came out on top in terms of price and preference points, explained the department.

“The department follows a strict and thorough procurement process to ensure fairness and transparency when procuring goods and services,” the department stated.

The bid, according to tender records, was opened to prospective contractors on 21 April and had a closing date of 9 May.

Some of the losing bidders have expressed their shock and dismay over Royal Security’s appointment.

Businessman Roy Moodley and former president Jacob Zuma at the Durban July in 2010. (Photo: Goldcircle)

Speaking to Daily Maverick on condition of anonymity, one such bidder said he was surprised when he heard that “Zuma’s guy” had clinched such a lucrative contract in the Western Cape.

Another unsuccessful bidder said his firm was shocked when they learnt that “one of State Capture’s kingpins” had won the deal.

Western Cape Premier Alan Winde said he was “outraged at the possibility that the provincial government could be in a position of doing business with alleged profiteers of crime.”

“This is unacceptable and I will do everything in my power to end this practice,” vowed Winde.

According to the premier, the provincial government currently cannot bar entities like Royal Security from doing business with the province unless they’d been blacklisted by the National Treasury.

The politically connected Moodley founded Royal Security in the late 1980s. He resigned as a member of the closed corporation in 2015.  Moodley’s son Magesh is listed as the entity’s sole member.

“I am the current owner of the company, and the questions arising from your email are inappropriate, misrepresentation of facts and can best be described as bizarre and most unbecoming of a journalist and author,” Magesh Moodley wrote in an email. 

“It would appear that you are simply angling for a scoop to profiteer from the past allegations which are irrelevant to the current running of the company.”  

Royal Security was a “lawful tenderer and [was] successfully awarded the contract based on our bid,” added Moodley. 

“Should you persist with slandering my company any further, I will have no option but to engage my legal team personally against you and your newspaper that employs you and sue for any damages should any losses be incurred whatsoever due to your reckless statements.” 

Moodley Snr could not be reached for comment. He did not respond to queries sent on WhatsApp. 

Royal deals

Roy Moodley and some of the entities linked to him, including Royal Security, have been implicated in some of the foremost alleged State Capture schemes during the tenure of former president Jacob Zuma.

A tweet the DA posted in November 2017. 

A simple desktop search would have pointed the Western Cape infrastructure department’s officials to a multitude of examples of such alleged grand corruption. 

  • This reporter in 2016 first revealed that Royal Security and another of Moodley’s businesses, Hail Way Trading, had pocketed a staggering R550-million in payments from Siyangena Technologies. This was after Siyangena had clinched contracts worth more than R4-billion from the Passenger Rail Agency of SA (Prasa). Moodley, allegedly one of Prasa’s principal captors in the era of disgraced former Prasa boss Lucky Montana, supposedly pocketed such payments in his role as the alleged gatekeeper of the SOE’s coffers.
  • Another Prasa contractor, Prodigy Business Services, made questionable payments to Moodley’s Hail Way Trading after the former had won Prasa contracts worth more than R80-million.
  • Moodley’s sway over Prasa allegedly stemmed from his relationship with Zuma, much as the Guptas’ influence over other SOEs resulted from that family’s ties to the former president. EFF leader Julius Malema, in 2014, first alleged that Zuma had once pocketed a secret salary from Moodley. The Zondo Commission later heard that Zuma had indeed banked a monthly “salary” of R64,000 from Royal Security. Some of these monthly payments were made after Zuma became president.
  • In addition to the alleged kickbacks or rents from the likes of Siyangena Technology and Prodigy, the Moodley family clinched lucrative deals directly from Prasa. Shortly after Zuma became president, Royal Security bagged its first Prasa security contract and ended up earning more than R470-million from the state-owned rail operator, the commission was told. Strawberry Worx, founded by Moodley’s other son, Selvan, won lucrative billboard deals from Prasa.

‘Unpalatable’

Royal Security’s appointment in a DA-led province will no doubt be viewed with some irony. The party has been at the forefront of criticising the Zuma administration’s corruption scandals. This includes Moodley’s and Royal Security’s alleged transgressions. 

In 2017, the then DA leader Mmusi Maimane accused Zuma of having breached the Executive Ethics Code by failing to declare his “salary” from Royal Security.

And in 2018, the then KwaZulu-Natal DA leader Zwakele Mncwango met with the Hawks to discuss concerns about contracts Royal Security had allegedly won from the eThekwini metro.  

We asked the department whether it had considered the allegations levelled against Royal Security and Moodley, including those that were presented alongside documented evidence at the Zondo Commission. 

We also wanted to know whether the company’s appointment didn’t make hypocrites of the Western Cape provincial government and the DA. 

The department responded as follows: “Unfortunately, as unpalatable as it may be, the supply chain management processes do not allow a government institution to exclude an individual or organisation against whom only allegations of wrongdoing have been made, from bidding for government work, when those allegations have not been tested and confirmed through judicial processes. This flows from the most basic tenet of being ‘innocent until proven guilty’.”

It is not clear why the department does not view Zondo’s Judicial Commission of Inquiry into Allegations of State Capture as a judicial process.

“As part of the tender process, various checks are conducted to ensure that a company is able to deliver the requested goods or services,” said the department. 

“This includes checking the entity’s compliance and registration information, including tax compliance, BEE status and Private Security Industry Regulatory Authority registration. In this instance, Royal Security passed through the various stages of the procurement process and offered the most competitive bidding price when compared to other bidders.  

“Royal Security was also not found to be blacklisted or on any defaulters list, nor convicted of any unlawful activity.” 

Winde, meanwhile, promised further action.

“We will be writing to the implicated company to raise our concerns about the allegations made regarding their practices and looking at other remedies available for us to deal with this glaring gap in the tender processes.” DM

Gallery

Comments - Please in order to comment.

  • Pet Bug says:

    Oh dear.
    But then, doing any work for the DoI is the most cruel, disheartening, disrespectful and often willfully underhand and probably illegal experience any professional should suffer.
    That lot is horrific.
    Could be karma, and drive the “winning team” insane.

  • Fanie Rajesh Ngabiso says:

    I’m pleased DM has raised this red flag but the article doesn’t as far as I can see claim or identify specific wrong doing by the department or am I misunderstanding?

    Now that the concern has been identified, the measure for me is how the DA deals with it – my guess is openly, fairly and decisively, within the ambit of the law, like a decent party should.

    But let’s see.

    • Glyn Morgan says:

      I agree with you. I am sure all eyes will be on the new boy, Magesh. If he puts a foot out of place he will get nailed.

    • Timothy Van Blerck says:

      So why not invite the Guptas over for tea and tenders? This is the typical ANC try of innocent until guilty – while ignoring piles of circumstantial evidence. The ultimate irony is the same party threating to arrest Putin when he also “innocent until proven guilty”.

      Do better DA

    • Bradley Welcome says:

      Wholeheartedly agree. How this is managed going forward will be the indicator of whether the DA truly walls it’s talk. The bid winner have a questionable past, but have they mended their ways? Time (and I am fervently hoping Winde) will tell.

    • Cheryl Siewierski says:

      Agreed. It might be unpalatable that the company started by the allegedly dodgy Roy Moodly is still doing business, but it appears that his son has been the owner of it since 2015, so surely the focus should be on Magesh – he cannot be held responsible for the ‘crimes’ of his father, surely? Unsavoury, but yes, I agree with the DA here – innocent until proven guilty is important, and Magesh has not been implicated in anything as far as I can tell?

  • jcdville stormers says:

    Well you’ve lost my vote DA

  • Dennis Bailey says:

    A clear indication that for all its rhetoric and vitriol, the DA is as bad as any other party. I’m sure John will have an opinion!! Viva, political crookery, Viva.

  • Marcela Reynoso says:

    Guilty until proven Inocent
    We had been watching over yeeears to many people escaping justice with the same slogan “Inocent until proven guilty”
    Isn’t time to change it?
    Our constitution is supposed to be the most progressive in the world
    Isn’t it protecting corruption?
    How can be possible that court cases go on for yeeears?
    Zuma, the Public Protector…
    Was this constitution created to protect criminals instead of descent citizens?
    I know, I have only questions without answers but what I am sure is that the constitution gives too many rights a few responsibilities

  • Carsten Rasch says:

    For the DA, history clearly does not count as much as due process. In a country where the worst gets away with the most, judicially speaking, ‘innocent until proven guilty’ sounds a lot like ‘can’t comment, it’s sub-judice’ – in other words, kicking for touch.

    • Paul Hjul says:

      This smells like covering over extortion. The contract from the Department is for security which is needed to prevent looters and rioters from replicating in the Western Cape the damage done in KZN. It’s to prevent the sort of damage to infrastructure which Eskom experiences. Well bag handlers of the Zuma cartel are perfectly placed to take a multimillion rand payment to keep the thugs at bay. An official in the Department is therefore making a choice to negotiate with terrorists.

      If Winde actually is committed to proper governance he’d legitimately do what the national government enjoys doing badly. He would appoint an inquiry (a provincial enquiry) to determine the extent to which local and provincial government resources in the Western Cape are hijacked by entities linked to organized crime as a result of intimidation and threats.

  • Pieter Badenhorst says:

    I am concerned about the change in tone from the DM reporters. This article seems like a “shock and horror” piece, with little substance to support the allegations. As far as I can see, everything that is reported is based on allegations and assumptions. Unless, and until, the recommendations of the Zondo commission are acted on, the findings cannot be used to unilaterally exclude people from doing business with the state, be it National or Provincial.
    DM may do well to do a bit of introspection about putting form over substance and spreading the management too thin to maintain the very high levels of reporting I have become accustomed to.

    • Glyn Morgan says:

      Right. No allegations of wrongdoing. With all the eyes on this Moodley he is going to be squeaky clean!

    • David McCormick says:

      Agree Pieter.
      The Supply Chain Committee will have been well aware of Royal Security’s past dealings however without being found guilty by any authority, the Province could be sued by Royal Security if they were not awarded the contract as the lowest elegible tender.

      • André Pelser says:

        One would think that the WCG has a Red list of service providers and suppliers that are ruled out of contention for tenders due to poor record of service or dodgy reputation.
        There are a number of non-political, first class security companies with unimpeachable records that can provide this service.
        There is also nothing wrong with Scorpio making this contract award public, it is strange that a DA run province would award such a huge contract to a company owned by/linked to a major state capture individual.

    • Timothy Van Blerck says:

      This comment illustrates the deep seated tribalism in SA politics – its not corruption if its my friends feeding at the trough

    • Cheryl Siewierski says:

      Agreed. Listing the crimes of his father doesn’t do anything to tell us about why the son’s company should be excluded. All this kind of story does is muddy the waters of what, even from this story, should actually be crystal clear in terms of process.

  • Alley Cat says:

    “Unfortunately, as unpalatable as it may be, the supply chain management processes do not allow a government institution to exclude an individual or organisation against whom only allegations of wrongdoing have been made”
    And therein lies the problem? WHY have they not been prosecuted and WHY has treasury not blacklisted them? NO CONSEQUENCES AS USUAL!!!
    Your move DA.

    • Karl Sittlinger says:

      You mean: your move ANC. The treasury is not under DA control. That being said, I am sure they could have found another way to disqualify them. However, merely being mentioned in the Zondo report is not equal to being guilty, as the ANC so often likes to point out. Lets wait for some facts before pouncing upon the DA.

  • Peter Dexter says:

    I have two issues with the Royal Security protestations:
    1. Roy Moodley is no longer a member of the CC. The CC is a juristic person and is still responsible for the harm caused to South Africa, irrespective of its ownership – especially when that transfer is from father to son. (I wonder whether Junior paid fair value for his member’s interest, or whether a deemed donation occurred.)
    2. Everyone in government departments cries “Innocent until proven guilty” when questioned about dealing with questionable companies or individuals. The state requires the private sector to comply with “Ethical Standards.” Why should the state not apply ethics? An action may be legal but still unethical because it is morally wrong. Ethics is doing what is right even if no one is looking, or there is little chance of being caught. The concept of ethical behaviour is rare in the public sector, and I imagine unknown by most “cadres.”
    It appears that the DA still has a few ANC deployees within its ranks?

  • Hilary Morris says:

    Ooooops!

  • Jeremy Stephenson says:

    Actually although Roy Moodley’s name crops up quite often in the Zondo Commission’s report, it did not make any recommendations in respect of Royal Security, and its only recommendation against Moodley was in connection with a kickback related to the appointment of Regiments to Transnet.

  • djmarais says:

    Please show me where the law was not applied correctly, or shut up. People wanting to blacklist this company based on untested evidence are exactly the same as the Zuma lot – we don’t like you, so you get no business from us.
    The fact that the company has not been prosecuted or blacklisted by national Treasury, is not the fault of the DA in the Western Cape, so the commenters trying to lay the blame with the Da should stop with the blame-shifting.

    • Iam Fedup says:

      This is no longer about the law DJ, but about the fact that if you sleep with dogs you get fleas. Many, many criminals throughout history have operated freely within the law.

      • Abel Mngadi says:

        Agree. How many people and companies are walking around after stealing taxpayers’ hard earned money due to the useless police and justice system of this country. Must we now do business with them because they probably manipulated the system and have not accounted for their actions? Why do business with someone whose integrity is questionable? Corruption will never end as we have people justifying it because these people have not been brought before the courts? We know they are protected from facing justice because of their connections. If it was you and I we would be long in jail

    • Libby De Villiers says:

      Where there is smoke there is, more often than not, fire!
      With politicians of any kind and party, one cannot take your eye off the ball. They are universally known to disappoint.

  • Hennie at Work says:

    I am all for exposing the wrong doing of people, but this has a bit of a “hatchet job” character to it. Pieter Louis – I see you managed to get 1 sentence from Alan Winde. Did you bother speaking to anyone else at the DA? I only see one side – the journalist’s – to this story. Did you actually bother investigating or did you find 1 thread that you decided to pull on and because it unravelled into what may be a story you didn’t bother further? This isn’t good journalism in my opinion. Do better.

    • Ritey roo roo says:

      I agree.

    • William Stucke says:

      Quite. This more DA bashing from DM.

      How about some real journalism? How about doing some actual investigation? How about some unbiased reporting?

      And why does the article not say, clearly and unambiguously, that the WC DoI has *not* done anything untoward, given the current legal structure. What it could have done, though, is to look into the issue of provincial government setting higher standards than national.

  • Brian Doyle says:

    DA should have done their homework or they will also fall under the cloud of suspicion regarding corrupt activity in awarding a contract. They should immediately suspend the contract and go out to tender again

  • Ernest Esterhuizen says:

    This is incredible and appalling. A R282 million tender and the name Royal Security raised no alarm bells during the process? What did the infrastructure officials smoke during the sitting of the Zondo commission and while scrutinising all the tenders? Unbelievable! How fair is this? I thought this was the DA, the opposition party at work here, but they come with the exact ANC-crap of “proven until guilty”. This decision has certainly jeopardised DA votes for 2024. Investigate the person who gave the final stamp of approval for this tender. I cannot yet again see how my tax is yet again ending up in the hands of crooks!

    • virginia crawford says:

      Absolutely agree. Amazing that any company involved in State Capture is allowed to put in tenders for government contracts. Shocking- all that money and effort spent on the Zondo Commission has come to nothing. Aloota continua.

  • Mariella Norman says:

    Looks like some DA officials might need to have their bank balances checked and a lifestyle audit put in place going forward! Can the DM please find out what the track record is for this company in terms of being able to keep infrastructure protected from criminality. Where else are they employed, who else has employed them and have they been effective.

  • Rae Earl says:

    Roy Moodley is a big benefactor of Jacob Zuma. That tells us all we need to know about both of them regarding the corruption game.
    The Zondo commission cost us tax payers a colossal amount of money Mr. President. Why are you so hell bent on keeping them under wraps? Are there too many of your ANC colleagues and their connections in the business world recorded in the files? Are you hiding them until after the 2024 elections so you and your ANC comrades can get another bite at the cherry and another 5-year looting spree until SA is reduced to Zimbabwe status?

  • SAM VAN WYK says:

    WHAT IS THE DA DOING SUPPORTING ANC CROOKS?

  • Peter Oosthuizen says:

    This is not unbiased journalism but sensationalism worthy of the Daily Mirror.
    If the tender process was followed and the lowest succesful tender got the job that’s all one can ask of the Province.
    Having said that if Winde does appoint a commission it would be interesting to see the comparisons made public.

  • David Walker says:

    Well done to DM for exposing this. I am sure that Premier Winde and the DA are grateful. Now we need to watch how DA politicians respond compared to the thousand times we have read a story like this from ANC governments with no response whatsoever (except for commission after commission).

  • Iam Fedup says:

    Many of the commentators in this article have taken the stance of “where is the evidence?” and “innocent until proven guilty.” Those are the rules of a fair game, but the problem is that the gloves are off now. If you want to negotiate with scoundrels, then just like in the days leading up to the Second World War, you have to understand that the scoundrels will use every tactic in the book, legal or illegal, moral or immoral, to get their own way. And so it was that eventually Britain decided that the only person to lead them in this crisis was the English bulldog Winston Churchill. The current DA leadership, starting with John Steenhuizen and continuing through Alan winde, are like helpless sheep, trying to appease the political elite. This is a time for decisive leadership, not helpless bleating, and they will certainly not be getting my vote next time. I want someone with teeth, who will be prepared to take immediate action and suspend the self-created crisis that we find ourselves in right now.

  • Lisbeth Scalabrini says:

    The DA has just lost a big slice of its reputation.

  • Rod H MacLeod says:

    If you live in the Western Cape, join the Capexit initiative now. This saga is typical rubbish – provincial administrations are allowed to set bid criteria HIGHER than National, and HIGHER than National Treasury blacklists – just not below. Why don’t they?

    So, if Winde had no idea that a quarter billion security contract was being awarded to these shady providers, he is a BS artist of note. Time for Capexit and to be done with incompetent and shady KZN/Gauteng/Mpumalanga/Limpopo/North West/Northern Cape/Eastern Cape/Free State operators and administrators.

  • rmrobinson says:

    Why must the tax payer foot such a bill for private security? Why can the local police not do the job? And, if it must be private, why this lot? How did they get it?

  • Jacques Wessels says:

    Viva viva Free Press & DM as without you they All would be drinking Johnny Walker Blue without a worry at least with you around they at have to read articles like this & then laugh at our legal system…

  • Paul Savage says:

    Of course, if the NPA was remotely competent then Zuma would be in jail, as would the Moodleys, and the WCG could be confident that it could contract with the best service providers required for the services they required. Why can’t Batohi do her job. Useless!

  • jcdville stormers says:

    Suddenly, now that the shoe is on the other foot,DA loyalists “doth protest to much”Dont forget the Glomix tender with Ralph Stanfields wife

  • Coen Gous says:

    Well, the DA has really been caught with their pants down to their ankles this time

  • Change is good sa says:

    The DA need to do everything possible to stop this contract. Roy Moodley, in his support of Zuma and his pursuit of excessive amounts of money, has destroyed Ethekwini and KZN. The building extortionists (lets not call them business forums) have stopped work all over the city, destroying jobs and BEE companies. If he gets his hands on infrastructure security in the WC, his corrupt tentacles will have far reaching consequences for many years to come. The fact that the ‘robust’ due diligence in the tender process did not stop Royal Security getting the tender, already shows that corruption or intimidation are in place already.

  • Maite Rabyanyana says:

    Where was DA looking, letting this happen? What is Steenhuisen saying about this now? I really do not understand how this contract happened right under their noses, when they are so anti-corruption conscious! So there’s really no political party to be trusted, or to rely on. Yoh!

  • Roger Sheppard says:

    There is no hypocrite tainting here.
    If this article is truthful, the DA DoI in Western Cape pursued the legal line, not a party line, or a persuader’s or blesser’s line.
    The DA will investigate both the present tender or procurement system which allowed this to happen, as well as MAKE IT PUBLIC. Not like when all serious stuff investigated is wrapped in black, green and yelo coffin cloth!

  • Peter Wanliss says:

    Most disappointing, Daily Maverick, and those commentators jumping on the anti-DA bandwagon. The question is: Did the Western Cape follow the regulations to the letter? If ‘Yes’, then what is the point of this article? Supplementary question: The DA (and others) frequently has recourse to the courts and the law in order to combat state capture and its numerous off-shoots. Should the DA now abandon the law?
    Those who haven’t read it, get a copy of ‘A man for all seasons’ by Adrian Bolt from the second-hand store, or better, watch the movie, in which Thomas More presents the following arguement to his prospective son-in-law Roper: ‘And when the last law was down, and the Devil turned round on you—where would you hide, Roper, the laws all being flat? This country’s planted thick with laws from coast to coast—man’s laws, not God’s—and if you cut them down—and you’re just the man to do it—d’you really think you could stand upright in the winds that would blow then?’
    Also note how Rich, having succumbed to the first bribe, finds it easier to accept the next.
    Full marks to the Western Cape for sticking to rules, as they claim and hopefully did, even if it means that a possibly unsavoury yet legally qualified business gets the contract. Anything else puts us on the slippery slope to lawlessness.
    A final thought: Say the WC did not award the contract to this bid, and a court found that there were no legal reasons for disqualifying the bid – how would that make the DA look?

  • jcdville stormers says:

    Question is, does the DA make mistakes?Yes or no?

Please peer review 3 community comments before your comment can be posted