An investigative report published by the Daily Maverick reveals the alleged involvement at the very top of the EFF in benefiting from some of the looting to the tune of nearly R2 billion from VBS Mutual Bank.
It was already reported yesterday that EFF deputy president Floyd Shivambu’s brother Brian received R16 million from the bank. The Daily Maverick’s investigative unit has now revealed that as much as R10 million of this money may have been given to Shivambu by his younger brother, while R1.3 million went into the party’s bank account.
The money to Shivambu was allegedly funnelled to him through a company called Sgameka Projects.
Brian Shivambu received R16,148,569 in “gratuitous payments” from VBS, according to a Reserve Bank investigation.
Shivambu has tried to suppress investigations into the VBS fallout for months and famously took on Treasury’s Ismail Momoniat in a racist rant in parliament, ostensibly because he is Indian and “non-African”. Momoniat, however, was also described by Daily Maverick as the “driving force behind what was happening behind the opaque veil at VBS”.
The EFF released a statement on Wednesday about the Reserve Bank’s explosive report on the VBS affair in which it recommends criminal charges should be laid against more than 50 individuals who improperly received funds from the bank.
In the release, spokesperson Mbuyiseni Ndlozi said the party stood by its call for all those responsible for the VBS bank fraud and who benefited illegally to be “prosecuted illegally”.
However, the normally vocal party and its leaders have been uncharacteristically quiet since the news broke and attempts to reach any of them directly since yesterday have proven futile.
The Daily Maverick further reports that it’s possible the EFF received more money “through other fronts” from VBS.
Advocate Terry Motau was appointed by the SA Reserve Bank to probe the collapse of the mutual bank that was placed under curatorship.
Motau, assisted by Werksman Attorneys, found that there was “wide-scale looting and pillaging of the monies placed on deposit at VBS”. The monies were clients’ life savings and deposits, including millions of rands deposited by municipalities.
The report, titled “The Great Bank Heist” showed that at least 50 people “gratuitously” received R1.894 billion from the bank over a three-year period starting in March 2015.
They included top management at the bank’s major shareholder Vele Investments, its associates who cashed in more than R936 million. Others also included bank executives and Limpopo politicians.
VBS chairman Tshifhiwa Matodzi got R325m, CEO Andile Ramavhunga got R28 million, the Free State Development Corporation (R104mln) former ANCYL Limpopo leader Kabelo Matsepe (R35mln), former KPMG partner Sipho Malaba (R33mln) Venda king Mphephu Ramabulana (R17mln) and Shivambu (R16mln).
The elaborate scheme involved VBS directors creating large fictitious deposits in favour of Vele, which was put forward as the bank’s biggest shareholder, and its associates. They then went on what Motau terms “a massive spending spree at the expense of VBS’s depositors”.
Motau said that this could have been detected much earlier if not for the fraudulent misrepresentations in monthly regulatory returns that VBS submitted to the Registrar of Banks, and in its audited financial statements for the 2016/17 financial year.
Motau called for the prosecution of the illegal beneficiaries and that urgent steps must be taken to wind up the failed bank.
“It seems clear to me that there is no prospect of saving VBS. It is corrupt and rotten to the core. Indeed, there is hardly a person in its employ in any position of authority who is not in some way or other complicit.”
(Additional reporting ANA. Compiled by Charles Cilliers)