Former Johannesburg mayor and MMC for community development, Kabelo Gwamanda, has been placed on special leave with immediate effect amid his arrest for insurance fraud charges.
Story Summary:
- Kabelo Gwamanda has been placed on special leave by the City of Johannesburg due to his arrest over a fraudulent funeral insurance scheme.
- The leave ensures that Gwamanda continues to receive his full salary and benefits, while an acting MMC will be appointed to cover his duties.
- Gwamanda is accused of defrauding Soweto residents through his company Ithemba Lama Afrika, a case that has been under investigation since 2023.
ANC gifts Kabelo Gwamanda full salary package while on special leave
City of Johannesburg mayor Dada Morero made this decision after meeting with Gwamanda on Tuesday morning, in light of the serious allegations surrounding his involvement in a fraudulent funeral insurance scheme.
While on special leave, Gwamanda will continue receiving his salary and benefits, which, as an MMC, can range between R1.3 million and R1.6 million annually, according to Politicsweb.
This compensation includes allowances for transport, housing, medical aid, and pension contributions.
This type of leave is typically used for employees dealing with legal matters or personal investigations.
For Gwamanda, this period ensures that the legal proceedings can unfold without impacting his official duties, particularly in a high-profile role such as an MMC in the ANC-led City of Johannesburg.
City officials indicated that Morero will appoint an acting MMC to ensure the continuity of service delivery in Gwamanda’s absence.
Kabelo Gwamanda’s legal troubles stem from an alleged fraudulent funeral policy scam that dates back to 2011.
Through his company, Ithemba Lama Afrika, Gwamanda reportedly sold funeral policies to residents in Soweto.
However, policyholders discovered that when it came time to claim their benefits, the company had vanished. Some were even falsely informed that the directors of the company had committed suicide.
One victim of the scam later recognised Gwamanda when he became Johannesburg’s mayor in 2023.
This led to a formal investigation by the Financial Sector Conduct Authority (FSCA), which revealed that Gwamanda had been running the business illegally.
Despite Gwamanda dismissing these allegations as a “character assassination,” the evidence prompted his arrest in connection with multiple counts of fraud.
After evading capture for months, a warrant was issued for Gwamanda’s arrest in May 2024, but he only turned himself in on Friday, 18 October 2024.
He was subsequently released on bail and is expected to make further court appearances in the coming weeks.