As organised crime syndicates increasingly entrench their dominance, South Africa’s telecommunications sector players are struggling to lay new infrastructure.
So said Thokozani Mvelase, CEO of Communication Risk Information Centre (COMRiC), highlighting that the telecoms sector is not immune to ‘extortionists’, as he described them.
COMRiC is the non-profit organisation (NPO) focused onleading crime and risk intelligence within the telecoms industry.It counts Cell C, Vodacom, MTN SA, Telkom and Liquid Intelligent Technologies as its founding members.
Last week, the NPO introduced its inaugural 2025 Telecommunications Sector Report, which examines the financial and societal implications of threats impacting SA’s telecoms space.
COMRiC estimates the cost of telecoms fraud, which includes fraud and network infrastructure vandalism, cyber crime, subscription fraud and SIM box crimes, at R5.3 billion annually in 2024.
From a telecoms infrastructure perspective, Mvelase said some of the key threats that take place on a daily basis include theft and vandalism, which are not spoken about enough. “We as a country have, one way or another, accepted the levels of crime that we see.
“The organised crime syndicates…we’re not the only ones [impacted] but we are mostly impacted by it. These days…we can’t lay new infrastructure in an area because of the organised syndicates who will want to extort something from you before you can do any work in those areas.
“When you consider it, we invest more in resuscitating old infrastructure than in laying new infrastructure because of some of these impediments that we encounter as a sector.”
Speaking to ITWeb, the CEO elaborated that in addition to battery theft and the like, the telecoms sector must now also contend with organised crime syndicates.
“I know it has been termed ‘construction mafia’…it’s extortion because we don’t know what ‘construction mafia’ means – it means different things to different people. This has been happening for a while; it is just that our sector has not vocalised it.
“For example, when the men in the vans want to lay new infrastructure, or it’s a case of even fixing the existing infrastructure (which may have been stolen), they will be intimated and told they can’t work in the area unless they work with locals, or something to that effect.
“In some instances, no matter how big or small the project is, we end up not being able to deploy the necessary infrastructure timeously because of the delays as a result of these extortions.
“We are impacted heavily because when we have to lay infrastructure, we’d be prevented from doing that and required to come another day or another week.”
According to Mvelase, the adverse effect is that someone within a community will be left without connectivity because a specific company can’t progress with the laying of infrastructure.
He added that the issue is not specific to just one COMRiC member, but all of those with the infrastructure. “For instance, Cell C might not have physical infrastructure, but they are dependent on the infrastructure of Vodacom and MTN. From the physical standpoint, Liquid, MTN, Telkom and Vodacom all have infrastructure.
“Without restricting this to just our founding members, the sector is affected. There are those that are not our members but are also impacted by this issue.”
Mvelase further pointed out that the financial implications of this threat are two-fold; namely, the impact on revenue from the telco’s side and that without infrastructure, a small business owner will not be able to trade.
“The financial implications are for prospective entrepreneurs and the essential services that we have as a country.”
He said COMRiC works extensively with law enforcement to arrest the situation but admits the country’s law enforcement is overly-stretched.
“Us being part of the NATJOINTS [National Joint Operational and Intelligence Structure], we can provide a voice that informs them of the problems from an essential infrastructure perspective and the impact such a problem will have if it persists.
“We also work with the private security industry to make sure infrastructure is protected.”
Held to ransom
Last year, data centre commentators warnedthat the ‘construction mafia’ was increasingly threatening the burgeoning market.
The commentators, which participated in a panel discussion, stated that the growing scourge of the ‘construction mafia’ continues to sabotage investment potential in the local market.
According to Inclusive Society, construction mafias, often labelled as ‘business forums’, are networks that employ violence and other illegal means of controlling access to public sector procurement opportunities. These groups typically invade construction sites, demanding money or a stake in development projects.
During the criminal act, the leader of the company awarded the development project is approached by the members of the ‘business forum’ to extort funds. If an agreement is not reached, this often escalates to kidnapping, violence, assault, threats or murder.
According to South African attorney journal De Rebus, the mafias often justify these criminal acts by using the Preferential Procurement Regulation, 2017 as a scapegoat.
The regulation stipulates that 30% of a construction development project has to benefit the community where it is allocated, by way of employment. The regulation aims to use public procurement as a lever to promote socio-economic transformation, empowerment of small enterprises, rural and township businesses.
In 2019, at least 183 infrastructure and construction projects worth more than R63 billion had been affected by the construction mafia in SA, according to the Organised Crime and Corruption Reporting Project, 2022. Since then, invasions have escalated at construction sites across SA, it says.
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