The Ingonyama Trust Board (ITB) spent millions of rands irregularly on luxury vehicles, legal fees and tax bills for the late Zulu king Goodwill Zwelithini kaBhekuzulu, funding his lifestyle from levies collected on land under its control.
Although the monarch was entitled to use 5% of the revenue raised on activities related to his work as the board’s sole trustee, its former chairperson, Jerome Ngwenya, paid for weddings, accommodation and transport for members of the royal family, which the Ingonyama Trust was not entitled to fund.
Not only was a R1.55 million South African Revenue Service (Sars) bill— including penalties — incurred by the late king paid from trust funds in 2019, but a second payment was made to the tax authority for R459 000 on his behalf the following year.
The ITB also paid Zwelithini’s tax bill of R833 512.90 in February 2021 as part of a payment plan arranged with the revenue authority by Ngwenya.
The ITB took care of his vehicular needs too, splashing out R2.9 million on a BMW M760 LiXDrive for him in 2019.
This is despite the monarch being funded at the time to the tune of more than R60 million by the KwaZulu-Natal government, which also provided him with official vehicles and security.
The BMW replaced an earlier model purchased for the king in 2015 at a cost of just over R2 million.
The first record of the ITB buying the king’s vehicles is in April 2010, when it bought him a R1.03 million Lexus LX570.
Ngwenya also committed the trust to paying more than R9 million in legal fees run up by the current king, MisuZulu kaZwelithini, in his succession battle before his recognition by the government in March 2022.
The ITB has no budget for this.
The startling evidence of “maladministration” on the part of Ngwenya — and an array of supporting receipts and internal memorandums — is contained in papers submitted to the Pietermaritzburg high court by the current ITB chief executive, Vela Mngwengwe.
Mngwengwe’s revelations are the first time the finances of the trust, set up to administer traditionally controlled land on the king’s behalf, have been made public.
Under his tenure, Ngwenya had refused to submit its financial statements to the Auditor General of South Africa or to parliament, instead accounting only for the R20 million a year the ITB gets from the department of agriculture, land reform and rural development.
The trust collects about R90 million a year from commercial, agricultural and mining leases it raises from land under its control, but the detail of its expenditure has thus far not been made public.
The ITB has been under fire from the auditor general and parliament over Ngwenya’s stance, which had effectively blocked oversight on the funds it raised and spent.
The new board is defending an application by Prince Mbonisi Zulu, the uncle of MisuZulu, who has asked the court to set aside the removal of Ngwenya by the king and the appointment of a permanent board in May this year by Agriculture Minister Thoko Didiza.
Mbonisi wants Ngwenya and the old board reinstated and has asked the court to stop the ITB from making any payments on behalf of MisuZulu — including his legal fees in the succession battle against Prince Simakade and other would-be ascendants to the throne.
According to Mbonisi, the court needs to prevent the ITB from making payments of any kind until after the court has ruled on the succession matter, which was heard recently in the North Gauteng high court and in which judgment was reserved.
In his responding affidavit, Mngwengwe denied any impropriety by the new board and instead listed violations of its spending criteria by Ngwenya and the previous board.
Ngwenya was fired by the king earlier this year after an exposé by the Mail & Guardian of a dubious R41 million investment he made using trust money through an investment company he set up in 2019.
The money has not been recovered.
Mngwengwe told the court that the funding formula contained in the regulations governing the trust stipulated that 75% of revenue went to traditional authorities; 10% to the sitting inkosi; 10% for the running of the trust and board and 5% to the king, to be used in the furtherance of his duties as the trustee.
None of the disbursements were meant to be for personal use, but rather on expenses incurred while doing the work of the trust. Spending was also limited to activities outlined in terms of the trust regulations.
But the king could also make use of funds for items such as medical aid cover, funeral cover or “any other benefit deemed necessary”, provided that this was not already covered by another government department.
Mngwengwe said the current board was “confronted with a number of challenges which were inherited from its predecessors” and which were a result of “maladministration” by the old board.
Mngwengwe said the board’s induction in June had to be “converted into an emergency initial meeting of the board” because of outstanding legal fees owed to Strauss Daly Attorneys, who had represented Misuzulu in defending his succession.
The king had decided to change lawyers and the company had been refusing to release his file until he had paid his outstanding balance of more than R6 million.
After investigating, the board discovered that Ngwenya had signed an undertaking, on its behalf, to “raise and collect funds” to cover any bill for the king’s legal fees presented to the trust by the company.
“It was unclear at the time how the former board or chairperson could bind the trust for debts of the ingonyama [king] that did not relate to any of the expenses permitted in terms of the disbursement policy of the trust,” Mngwengwe said.
“However, the board was placed in a precarious position because its predecessors had made an undertaking on the strength of which the attorneys relied on for pursuing the payment of their fees from the trust.”
Mngwengwe said they had been forced to reach a settlement agreement with Strauss Daly for the legal fees and had paid R1 million as a lump sum, and had committed to 26 monthly payments of R205 246.10 to cover the outstanding amount.
According to correspondence and invoices submitted to the court, the ITB also paid R3.09 million to Strauss Daly in August 2022, in addition to the settlement, which totalled R6 282 000.
Mangwengwe said money would be taken from the 5% of revenue allocated for projects undertaken by the king, who had been informed that there would be no other payments made on his behalf during the 26-month period.
There would be no further payment of legal fees.
Mngwengwe said the new board was bound by agreements made prior to their appointment, “one of the unfortunate challenges inherited by this board” from the earlier board.
The new board had become aware of the “concerning” manner in which Ngwenya’s board had operated, particularly with regard to payments and disbursements.
It had discovered “many instances” in which payments had been made for services not covered by ITB policies.
These, including transport and accommodation for meetings of the royal family, payments for amabutho (age sets or regiments) and the purchase of two luxury cars.
“Further and of greater concern, there were a number of payments made for accommodation at hotels for members of the royal family, including the ingonyama,” said Mngwengwe.
Other members of the royal family had “benefitted from the funds for the trust”, including Mbonisi, whose accommodation had been paid for by the ITB when he travelled to Pretoria to deliver a letter to the president.
“This trip was not a trust related activity, nor was it a permissible expense,” Mngwenge said.
He said the previous board had been guilty of the kind of conduct Mbonisi was alleging against the current one, which had taken serious steps to address the maladministration it had uncovered.
Although there had been a history of Ngwenya authorising payments of a personal nature for the royal family, the new board was not doing so and had “undertaken a clean-up process” on the way the ITB and trust were being run.
“It has been established by the current board that there is a long history dating back to the days when the late king still lived, where the former chairperson would authorise payments and disbursements of a personal nature to the benefit of the ingonyama, present and former, and the royal family,” he said.
“The [board] deny that the current board are perpetuating this conduct, however [they] are bound to adhere to contractual obligations and undertakings made by their predecessors until the appropriate legal steps can be taken,” Mngwengwe concluded
He did not say what these legal steps will be.
Turning the demand by Mbonisi that the ITB be stopped from making payments, Mngwengwe said the relief sought by Mbonisi “strongly leans towards usurping the legislated powers of the iTB and stand to interdict the exercise of their legislated functions”.
Any such order would prevent the ITB from making payments on behalf of communities and traditional authorities and would have the “unintended consequence of prohibiting the board from making the necessary disbursements as permitted in law”.
Mngwengwe said that due process had been followed by Didiza when she appointed the current board as she had consulted the premier, the house of traditional leaders and MisuZulu.
Mngwengwe said that the new king had initially assumed the role of trustee when he had relieved Ngwenya of his duties as his nominee, but had subsequently “changed his stance” and had nominated the current chairperson, Inkosi Thanduyise Mzimela.
Legally, the king can either take on the role himself, or nominate somebody else to do so.
The new board was determined to bring operations in line with the law, and had taken “robust steps in correcting past irregularities, particularly on the issue of disbursements”.
“The present board has taken serious steps to ensure that it brings the trust back to a place of compliance with legislation and its policies,” Mngwengwe said.
Mbonisi has subsequently withdrawn the application.