The use of so-called consultants to assist co-operative members to register the details of their business with the Companies and Intellectual Property Commission (CIPC) is a growing problem in the Eastern Cape.
This has emerged after Director-General of Trade and Industry, Lionel October, recently warned about the practice.
Nomaci Qabaka, who owns the successful Xhobani Projects co-operative at Mdantsane outside East London, and also oversees 150 ventures in Buffalo City as chairperson of the local co-operative union, confirmed that these fly-by-night “consultants” were preying on the “vulnerable”.
“Our people are very enthusiastic about getting their businesses up and running, and so pay off anybody who says that they can register them quickly.
They very often do not realise that it is cheaper to register through the CIPC. These consultants know this, saying that the normal process will take ages,” she said.
“These consultants are very charming. They are very clever. They present themselves in a way that people don’t even ask for documents or proof that they are qualified as consultants. Members just believe that they are who they say they are, like someone saying he is a lawyer might do.”
In his warning, October said that in some instances, consultants would ask as much as R3 000 when registration through the correct channels cost as little as R170. This was confirmed by Qabaka.
“One of the problems we have here in Buffalo City is that Trade and Industry is not as visible as it is in bigger centers like Pretoria or Port Elizabeth, and so it is very difficult to tell everyone about the dangers of paying off consultants.
“I often have to use my own car and petrol to get to the outlying areas to warn people myself. The lack of money for this purpose remains a problem. We have to be foot-soldiers spreading the word, and we can’t be everywhere all the time, which is why a lot of people are not warned.”
That said, October revealed that even the CIPC offices in Sunnyside, Pretoria, were overrun by “consultants” who solicited and canvassed people entering the premises.
“It is a big problem, but we are always trying to help. We cannot allow vulnerable people to fall victim to these ‘consultants’,” Qabaka said.
Managed by qualified fashion designer Zanele Nongabe, Xhobani Projects specialises in the manufacturing of recycled glass beads, as well as a wide range of beadwork and related products, including jewellery, corporate gifting and décor items.
Xhobani Projects employs 16 people and is recognised as a best practice example of sustainable community development in the region. In addition to manufacturing, it also offers two specialised training courses.
- Visit www.xhobaniprojects.co.za. To contact the CIPC call 086 100 2472.