Hawks, NPA team up to investigate VBS Mutual Bank looting

The Hawks says it has assembled a strong, well-resourced team to investigate the looting of funds from the Venda-based VBS Mutual Bank.  The team will be guided by the National Prosecuting Authority (NPA). This follows the release of a report commissioned by the Reserve Bank into the troubled VBS bank. The report,”VBS Mutual Bank — The Great Bank Heist” found that around 53 people and entities unjustifiably and illegally received around R2 billion between 2015 and 2018.

One of those who benefited was the majority shareholder in VBS, Vele Investments.

Hawks spokesperson, Hangwani Mulaudzi, says the priority crime unit will not rush its investigations. Mulaudzi says the Reserve Bank report into the bank confirms some of the things they already know. “We have been punted but we have our own criminal investigations that we are dealing with. I won’t be able to give names because there are people that we are eyeing.”

The looting of VBS nearly cost thousands of depositors their savings. The bank was established to address the high number of unbanked citizens in the rural area of Venda in Limpopo.

VBS is widely used for collective saving schemes. The majority of the customers are mainly the poor and elderly.

WATCH:Talking VBS Mutal Bank Scandal 

The bank’s failure to meet its daily cash withdrawals prompted National Treasury to issue about a R300 million guarantee from the fiscus. The move aimed to protect the poor and vulnerable. The man tasked with leading the forensic investigation into VBS, Advocate Terry Motau, says funds were leaving the bank as soon as they were being deposited.

“The report looks at various entities and individuals who received monies without just cause because of time, as investigations cannot go on forever, hence there is effort to dissipate assets.”

Vele Investments feature among a long list of individuals and companies that have benefited from cash stolen from VBS.

The Curators of VBS appointed by the Reserve Bank to rescue the mutual bank are in the process of liquidating some of the assets that belong to Vele.

Former Chief Executive Officer Robert Madzonga is named in the report as being among the recipients of millions of rands. Madzonga could not deny receiving money, but has maintained that personally he did not break the law. He received a monthly salary of R500 000 including a once-off bonus.

“When I started as COO of Vele in 2016, I was paid R300 000 a month, it was increased to R500 000 later. “

Madzonga accused his critics of misrepresenting the forensic report. He says some individuals want him taken down. “It is the jealousy of (my) success, some feel Madzonga has lots of assets but they don’t check my background and work experience.”

Meanwhile, the Reserve Bank has been accused of sleeping on the job while money was being looted from VBS Mutual Bank. The Congress of South African Trade Unions and the South African Communist Party say the looting would not have taken place over such a long time if the Reserve Bank had been doing its job. The organisations are calling for action to be taken on the structural failure of the prudential system managed by the Reserve Bank.

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