By Moepeng Talane The community of a Boksburg, Ekurhuleni, township is engulfed in a hopeless situation of uninhabitable houses falling apart around them, after allegedly being duped by banks and developers into buying property built on land not suitable for such. Residents of Delmore East Ext 2 say they are gearing up for a civil lawsuit against some of the country’s largest banks as well as the construction sector regulator for what they believe was an injustice that has caused them emotional distress, some for decades. For Elias Matovheke, the nightmare started when he sought a home loan with Nedbank in 2013. He told Corruption Watch (CW) that he visited a branch in the metro’s Kempton Park area with high hopes that he would be able to provide a home for his family. Matovheke earned a salary of R10 000 at the time, working for a logistics company as a driver. When his loan application was declined, he retreated and went back to the drawing board to consider other options for his desperate situation. But not long after his hopes were dashed, a call came from a consultant at the Nedbank branch. She made Matovheke an offer he could not refuse – a new home loan. The only catch was that it was in a pre-determined area – Delmore East – which meant that he could not choose where he and his family would stay. His home would be built from the ground up by the bank’s preferred developer. Writing on the wall was ignored Years prior to this, however, Delmore East Ext2 was already seen to be heading for a crisis. “The year 2001 we had a flooding and it was not raining. Underground water was flooding our area,” another resident, Herbert Remley, said to CW. “Basil Read Construction Company who was[sic] the owners of the property at the time came with their engineers, municipality engineers etc. to try and stop the water coming out of the sinkholes. It took them days to stop it. The place was declared unsafe by their engineers and there was only hearsay that we will be moved to other houses. I was present at the time that mining officials said that the place should not have been developed for housing.” Matovheke’s deal involved a loan of R430 000 from Nedbank, with the house being built from scratch by a developer of its choice. This was more than enough for the father of two, as he would be able to move into his new abode just months after he signed the contract. “I felt proud that I would be able to provide a home for my family. I was very proud,” he said. Once the house was built, Matovheke collected the keys as expected, he told CW. His family moved in and all was well until they realised that something was wrong with the building structure. Several of Matovheke’s neighbours had also started noticing – and complaining about – the state of their own houses. Many of the houses were beginning to crack, and had damp walls. When the home owners put their heads together, they realised what their common problem was: not only were their homes built on what appeared to be a large sinkhole, but the area was also a wetland, common for this area of Gauteng. And so started their investigation into how this could have happened. The Ekurhuleni Metropolitan Municipality’s town planning department came into the picture to investigate how their inspectors, and the various developers in the area, could have missed this disaster. Ekurhuleni first issued a report declaring the area fit for building, but would later backtrack to issue a subsequent finding that indeed Ext 2 was not fit for building. Common denominator has faced no consequences So how did this happen? In Matovheke’s case, and in the case of another home owner in the area who was also financed by Nedbank, the common denominator was the consultant who called after the initial loan application had been declined. Her name is Jeanette Rapalalane. Rapalalane is no longer employed by the Nedbank, but not because she was dismissed for her part in what her clients claim was a clear case of fraud, but because she resigned ahead of a disciplinary process instituted in relation to the matter. In its response to questions from CW regarding Rapalalane’s role, Nedbank could only say she resigned prior to the conclusion of the disciplinary inquiry, nothing more. “Nedbank can confirm that it investigated allegations of misconduct against a former employee in 2019,” is the official position of the bank. Rapalalane’s gain from the alleged scheme was that Wanga Construction, a company belonging to her husband, would build the units for which she dished out loans. Wanga built Matovheke’s home, as it did many others in the area. This modus operandi too did not raise red flags for the bank. “Our investigation found that the former employee did not disclose her interest in Wanga Construction (a property developer) to Nedbank and this non-disclosure was in breach of her employment agreement with Nedbank. Although the former employee represented Wanga Construction as a preferred developer, the choice of the consumer as to which property the consumer wishes to purchase is not restricted by this in any way and the decision is ultimately up to the consumer,” said Nedbank. But it is no secret that many would-be homeowners are confused by the fine print and unaware of their rights, so was this choice clearly communicated to Matovheke, CW asked. “All I was told by Jeanette was that this is the company that will be building.” Abusing a position of authority for personal gain Matovheke’s belief is that the former consultant had only one intention: to source clients for her husband’s company, and her strategic position at Nedbank meant that she could manipulate circumstances and offer this new “alternative” to unsuspecting, but desperate clients. Corruption Watch asked Nedbank if Rapalalane could have carried out this scheme on her own, without the assistance or oversight of her colleagues in the home loans division. “Nedbank has investigated the allegations made by Mr E. Matovheke against Jeanette Rapalalane. As Mr Elias Matovheke had not provided a name of any person other than Jeanette Rapalalane, Nedbank was unable to verify the veracity of the claim of additional staff involvement,” was the evasive response. Rapalalane herself denies the fraud claims. She told CW that her part in processing a home loan for property that would later be developed by Wanga was complete oversight on her part, and not intentional. “I resigned [from Wanga, before joining Nedbank]. Even today, I’m not a member of that system. And I think where there was an oversight … I got involved in a transaction that the company was going to be a builder. That was my oversight.” She added that she was a victim of a biased disciplinary process, and Nedbank never sought to hear her side of the story. They sided instead with Matovheke. “My previous employer … they were very biased. And I’m saying they were very biased because obviously they need to protect themselves in how they handled the whole issue. “I wasn’t offered the opportunity to state the things the way they were. Yes, there’s a code of conduct that I didn’t uphold. When we join the bank, there’s code of conduct that we are expected to uphold. And one of them [sic] is to disclose any outside interests that you might have. So obvious[ly] in my case, I didn’t disclose when the company started trading.” No consolation for struggling homeowners For Matovheke and his neighbours, the plight for justice is far from over, but Nedbank and all the other banks that approved loans in the area are not the only culprits in the matter. “Banks should never have been granted home loans for properties build on this land as it is not suitable for houses to be built on. Banks never conducted inspections and valuations of the properties,’ Remley said. A new housing development does not happen until those wanting to build on it have jumped through several hoops to verify the suitability of the land. Their verification is done by the municipal authority in question, and the building process itself if regulated by the National Home Builders Regulation Council (NHBRC), the oversight body that is charged with this task. This means that all the companies that built homes in Delmore East, including Wanga, would have had to have the statuses of the properties verified by the NHBRC. Rapalalane also denied Matovheke’s claims that his house was not built to standard, saying he was being devious in this regard. Wanga, she said, had been called to the site on several occasions over the years since the house was built, to verify that the correct steps were followed in laying its foundation. This followed Matovheke’s complaints to the NHBRC that the foundation wasn’t holding. It must also be noted, she added, that Matovheke did not comply with the requirements of the council to report structural issues within a stipulated time frame. “With the NHBRC, the client can complain with them about the builder, if the builder didn’t build the house properly … within three months of occupation.” CW has seen correspondence between the NHBRC and a representative of concerned residents, in which the council details an investigation that it has conducted in respect of the condition of the area.