Lawyer accused of swindling RAF claimants suspended

Joburg lawyer Arnold Mkhabela has been slapped with suspension after being accused of stealing money from scores of clients he helped to successfully claim from the Road Accident Fund (RAF). 

The Legal Practice Council (LPC) has described Mkhabela's case as one of the worst because of the high number of complaints they received from his clients and the huge sums of RAF money he is accused of misappropriating. The Pretoria high court granted the LPC an order to temporary suspend Mkhabela's licence to practice as a legal practitioner.

The council has also issued a warning to potential clients not to use his services. Mkhabela is barred from practicing until October 15 pending the finalisation of LPC's application for his permanent removal from practice. 

“Mkhabela's is one of the worst cases we have handled hence it was important for the LPC to move on and ensure that he can be suspended and possibly struck off. The number of complaints against him and also, to some degree, the amount of funds he is alleged to have misappropriated, were uncommon for any lawyer,” said LPC spokesperson Kabelo Letebele.

The LPC is a national statutory body established in terms of section 4 of the Legal Practice Act and is mandated to regulate all legal practitioners and all candidate legal practitioners. Mkhabela was among 9,922 legal practitioners that were taken to the LPC for various transgressions last year.

The process to have him struck off started in August last year; at the time the LPC had been looking into 51 complaints lodged by his clients, 21 of which were for misappropriation of funds totalling R8m. Letebele said 23 new complaints were lodged since February this year bring a total number of complaints to 74..

“The suspension is part of the overall application for his striking off. The suspension is an interim measure by the court, largely to protect the public, while his overall case is being considered by the court.

“The suspension means he cannot practice as a legal practitioner and members of the public are urged not to make use of his services or services of any legal practitioner that is suspended or struck off,” Letebele said. 

Mkhabela's attorney Frans Mashele said: “The LPC made all sorts of allegations against my client which led to his suspension. We will exchange pleading documents with the LPC to respond to all the allegations.”

In one of the recent cases Zanele Songo, 37, a mother of three from Daveyton in Ekurhuleni, lodged a complaint in July after Mkhabela allegedly failed to disclose that he had received her R500,000 payout from RAF.

Songo was involved in a taxi accident in 2012 and she had not been aware that her claim was finalised until she inquired with RAF in April last year.

“They said R500,000 was paid to Mkhabela in 2021. When I raised this with him he said he was going to inform me about the outcome. He said he didn't have the money with him but he'd offer an allowance. I refused ... I told him I don't need a “girlfriend allowance” and I needed my full funds. I then went to lodge a complaint with the LPC in July,” Songo told Sowetan last week. 

She works as a cleaner at Charlotte Maxeke Johannesburg Academic Hospital, earning R3,700 a month. “My contract is coming to an end next month. I need my money to care for my children and mother,” said Songo.

Mkhabela told Sowetan that he needed more time to go through Songo’s file.

As part of the suspension, the LPC has also taken over Mkhabela's trust account which RAF normally deposit funds into after he successfully claimed for his clients. Letebele said this was to ensure that Mkhabela doesn't withdraw from the account while he is still under suspension. 

His suspension bars him from accepting new clients and cannot appear in court or do any activity that can be conducted by a duly admitted legal practitioner, said the LPC.

While Mkhabela was staring at his suspension, in October last year the Johannesburg high court granted Standard Bank the right to repossess his lavish BMW M850i Convertible and a Land Rover Sport 5, on which he has defaulted on payments. His legal battles over unpaid business loan and credit card debt is still before the court, where he is pleading poverty “worsened by Covid-19 lockdown”.

Court records reveal that during that period, Mkhabela lived a life of luxury which included buying of expensive bottles of wines online. 

Sowetan started receiving complaints about Mkhabela in December last year, and our investigation led us to his offices on the 5th floor at north state Building in Marshalltown, Joburg, where a lot of people queued up for his services, oblivious that the LPC was investigating him.

Some of his clients were there to inquire about their claims, which they said were dragging. Sifiso Mazibuko  had travelled from KZN.  Mazibuko's leg had to be amputated after an accident in 2017.

Landelani Madela, also from KZN, found out from the RAF that R350,000 had been paid out to Mkhabela in September 2022 but Mkhabela failed to disclosed this information to him.

Mkhabela's clients whose matter are pending with the RAF or the Fidelity Fund are urged to contact the LPC so that this is noted during the curatorship process and they can be guided accordingly.

“The curator will take control of the practice, including the files of all clients, until the matter is finalised and the court makes a ruling.  Clients may [also] approach the LPC to collect their files in order to instruct a new attorney,” said Letebele. 

The LPC can be contacted on +27 (0) 10 001 8500 or info@lpc.org.za