Cape Town business owners threatened with death unless they pay extortion money

Business owners in Cape Town’s informal economy are threatened with violence and even death as part of extortion rackets.

There have been a series of violent incidents, including the murder of a 58-year-old woman in Delft, which have brought the issue to the fore.

Extortion rackets are not new in Cape Town. They have existed for years, with criminal syndicates demanding protection money through the threat of violence.

In 2024, the Institute for Security Studies said the past decade had seen a rapid rise in such practices, affecting a wider range of sectors of the economy.

The Global Initiative against Transnational Organised Crime (GI-TOC) said four distinct extortion economies have emerged in Cape Town.

These extortion rackets in the Mother City operate in the nightlife, transport, construction, and township enterprise sectors.

As with many international rackets, extortion in South Africa has been fuelled by initial successes, which led to expansion and copycatting.

Such practices in the township enterprise economies of Khayelitsha and Atlantis provide a clear example of this.

Gangs and criminal syndicates initially targeted foreign-owned businesses and, emboldened by their successes, expanded to other locally owned businesses.

The Western Cape’s Deputy Director of Public Prosecutions, Advocate Mervyn Menigo, explained that extortion is a low-risk, high-reward crime.

“You threaten somebody and get money. Kill one person, and you’ve got the whole community in your pocket,” he said.

In some places in the Western Cape, criminals involved in cash-in-transit heists and hijackings have turned their sights on extortion.

“They come with the same tactics they would with cash-in-transit heists, only the victim is unarmed, and they can’t shoot back at you,” said Menigo.

Protection fees and extortion rackets spreading in Cape Town

Numerous business owners in the informal economy in Cape Town’s townships are targeted by criminal syndicates running extortion rackets.

Extortion has already led to multiple deaths, with extortion gangs sending messages that, unless you adhere to their demands, violence will follow.

Newzroom Africa reported that many businesses are at risk of shutting down due to this criminal activity, which threatens the owners’ lives.

Many businesses in the Atlantis and Delft townships have received threatening letters demanding protection fees.

Thokozile Qalanto, the Secretary General of the Khayelitsha Business Forum, said the government mostly ignored the crime.

“Khayelitsha is the extortion capital of the Western Cape as the criminal syndicates have been operating there for years,” she said.

“There are two gangs operating in each ward in Khayelitsha. The extortion gangs have grown, and many businesses have closed their doors.”

She said this criminal activity has also stopped many young people from opening their own businesses, especially in the spaza shop sector.

The extortionists live in the same communities as the business owners, which means that business owners and even community leaders are terrified of speaking out.

Qalanto said that although the anti-extortion units made some arrests, it did not impact the criminal gangs or stop the problem.

“People in prison continue running the rackets, controlling tenders, and even demanding payments from outside,” she said.

She called on the City of Cape Town, the national government, the Presidency, and even the Defence Force to act.

She urged politicians to treat extortion as the top issue. “They must fight it properly and invest in safety and security instead of other projects,” she said.