Extortion in Cape Town

Cape Town-based organised crime groups have extended the reach of their extortion activities from nightclubs to coffee shops, restaurants, hotels and property owners. Darren Davids writes that due to high levels of corruption and collusion between police and criminal groups, authorities will be unable to curb the high levels of extortion in the Cape Town area.

Extortion in Cape Town

Cape Town-based organised crime groups’ protection rackets have in the past mainly concentrated on nightclubs in Cape Town’s Central Business District (CBD). Crime groups targeted nightclubs as they were able to traffic and sell drugs through these clubs, whilst also laundering money through their “security companies”. By some counts, approximately 200-300 businesses in the CBD were required to pay a monthly retainer for protection services before a countrywide lockdown was implemented on 27 March. Under the lockdown which suspended all commercial and social activity, barring essential services, crime groups were unable to continue their extortion activities. However, as restrictions gradually eased and businesses slowly reopened in June – whilst nightclubs remained closed – organised crime groups shifted their attention to coffee shops, restaurants, hotels and property owners. In some cases, members of organised crime groups have targeted foreign property developers, some of whom have fled South Africa and ceased future developments over fears for their safety.

These crime groups, who had previously forced nightclubs to make use of their “security services” – such as providing bouncers – through their private security companies approached other business owners and similarly demanded these businesses make use of their security services.

Threat environment

Anecdotal accounts indicate that extortion syndicates have been active in Cape Town for more than 10 years. The extortionists would approach club owners (particularly in Long Street, a popular street hosting dozens of clubs, restaurants and eateries in the CBD) at the end of the month to collect payment. Failure to pay resulted in damage to property and in some cases physical assault. The extortion fees for clubs and restaurants, which had traditionally been targeted before the Covid-19 pandemic, varied from ZAR 1,200 (USD 76) for a small bar to ZAR 90,000 (USD 5,730) for larger businesses.

Recently businesses outside the CBD, particularly those located in informal settlements, have also reported a significant surge in extortion and racketeering attempts. Criminal groups who control territory on the Cape Flats, an area situated to the southeast of the CBD, have targeted a variety of operations including construction sites, early childhood development centres, and retail stores.

Law enforcement agencies will struggle to make significant inroads in investigations into organised crime groups as long as links between police and the criminal underworld remain intact.

Police response

City authorities have asked for additional resources and specialist teams to investigate the extortion rackets as the South African Police Service (SAPS) has been unable to effectively clamp down on the extortion rackets. Police lack the resources to effectively investigate extortion rackets and are further hampered by widespread corruption – members of SAPS’s Anti-Gang Unit, a special unit responsible for investigating organised crime, are alleged to be working alongside crime bosses. A recent high-profile assassination of a police officer who was investigating the extortion rackets and members of the anti-gang unit may act as a warning to further disincentivise police from conducting meaningful investigations. Business owners understand the gravity and credibility of the threat, so very few extortion cases are reported to police.

Where to from here?

Law enforcement agencies will struggle to make significant inroads in investigations into organised crime groups as long as links between police and the criminal underworld remain intact. Extortion rackets have persisted throughout Cape Town for several years, largely due to the interconnected nature of nightclubs, drug trafficking, and the need for crime groups to launder money through these “security businesses”. While some extortionist rings have been uncovered and disbanded, other groups have simply filled the void left by the previous group. Anti-corruption drives within local and national law enforcement are underway but it remains to be seen how effective these will be. With corruption deeply entrenched within SAPS, and despite additional resources and the introduction of specialist investigative teams, the threat of extortion for businesses operating in Cape Town remains.