Former VBS Bank chairperson Tshifhiwa Matodzi's leaked affidavit alleged the involvement of a number of people in the looting of the bank, including EFF leader Julius Malema and deputy president Floyd Shivambu. (Photo by Per-Anders Pettersson/Getty Images)
Victims of the VBS Mutual Bank (VBS) scandal who lost their life savings say it is ironic that Economic Freedom Fighters (EFF) members are demanding the return of “stolen” land while failing to pay back the money they allegedly received unlawfully from the bank.
Aubrey Mulaudzi, who lost R2.5 million through the collapse of VBS, said he and other victims were not worried about whether those involved went to jail; they simply wanted them to pay back the money.
“The EFF says they want the land which was taken but they have taken our money and they do not want to bring it back,” Mulaudzi told the Mail & Guardian last week.
“They have got double standards. On the other hand they want the land back, on this side we want our money which they took and they don’t bring it back.”
On 11 July, former VBS Bank chairperson Tshifhiwa Matodzi agreed to a plea deal with the National Prosecuting Authority, resulting in a 15-year sentence.
His leaked affidavit alleged the involvement of a number of people in the looting of the bank, including EFF leader Julius Malema and deputy president Floyd Shivambu.
It detailed how both were aware of the illicit nature of payments made to them through Sgameka Projects, registered under the name of Floyd’s brother, Brian Shivambu.
Matodzi — in an affidavit before the Johannesburg specialised commercial crimes court sitting in Palm Ridge — stated that he paid the EFF R16 million after meeting Malema, Shivambu and secretary general Marshall Dlamini in April or May 2017, allegedly to stop the party’s criticism of the bank on public platforms.
The criticism followed VBS granting then president Jacob Zuma a R7.5 million loan for his Nkandla residence in KwaZulu-Natal, and Matodzi said the EFF’s “negative commentary” related to the loan was “damaging [VBS’s] reputation”. He added that he was asked to make a “donation” to the EFF so that its public lashings of the bank would stop.
“Myself, Julius and Floyd understood the concept of donation to mean gratification, hence Floyd and Julius did not provide me with the EFF’s own banking details for these ‘donations’,” Matodzi stated.
The money believed to have been looted from VBS amounts to R2.5 billion.
ANC Limpopo deputy chairperson Florence Radzilani — now MEC for social development — is accused of having R300 000 illegally channelled to her for investing in VBS during her tenure as the Vhembe district municipality mayor.
Victims of the VBS Mutual Bank (VBS) scandal who lost their life savings say it is ironic that Economic Freedom Fighters (EFF) members are demanding the return of “stolen” land while failing to pay back the money they allegedly received unlawfully from the bank.
In his affidavit, Matodzi said Radzilani demanded a further payment of R1.5 million for “Christmas money” in December 2017 because the R300 000 was not enough.
Mulaudzi said life had not been the same since his investment was stolen, saying it was “not easy” to accept that some people stole the VBS victims’ life investments but were “still walking around like nothing happened”.
He said having people like Radzilani in the provincial cabinet was “like spitting in the face” of those who lost their life savings, adding that she must step aside until she was cleared.
“I lost R2.5 million, which I worked for all my life. Life changed from 2017 and you don’t know whether you are going forward or backwards,” he said.
“The politicians are the same, it’s just that they were different types of overalls. How can they put a person that is said to have been part of the theft and looting of VBS but you still put them in front? It means you are the same as that person.”
Mulaudzi also called for the state to sell all of Matodzi’s assets to recover the money.
“He might have hid it for his parents, children or cousins. They must follow it up and let the money come back so that the poor people and us must get our money. [Philip] Truter is out; they never took or sold everything that he has. He is enjoying and he is out.”
Truter is the former chief financial officer of VBS, who received R5 million of the R2.5 billion allegedly looted from the mutual bank. He pleaded guilty in October 2020 to fraud, corruption, racketeering, theft and money laundering and also agreed to assist the state with evidence on how the funds from the defunct bank were plundered.
He was sentenced to 10 years, three of which were suspended. In April this year, Truter was released on parole after serving just three and a half years.
Matodzi was sentenced to 15 years on each count, or a total of 495 years. But the sentences will run concurrently and he will serve only 15 years after he pleaded guilty to 33 counts of fraud, theft, money laundering and racketeering.
“Matodzi will be out soon and all these other ones will plead guilty. If you plead guilty it means you have taken the money and you must bring it back or they must be followed until they die,” Mulaudzi said.
Another victim, Marothi Rannditsheni, told the M&G that the bank went bankrupt with R1.8 million of his money. He said this was his life savings and he had banked with VBS his entire life.
“I only used VBS bank for 30 years when I was working. I didn’t use any bank at that time because I was a shareholder of VBS bank. It would not make sense to bank elsewhere as I was a shareholder and I showed confidence in the bank,” he said.
“I trusted that bank wholeheartedly and they used to give us two dividends in a year, being March and September.”
Rannditsheni said after the demise of the bank, he had to start all over again, leading to a deterioration in his health.
“My blood pressure went up, it affected my eyes, I couldn’t see, I went to consult a doctor and he confirmed that my left eye doesn’t work. If there’s fog I can’t drive, I have to call someone from home to come and pick me up because I can’t see,” he lamented.
Since the bank was declared bankrupt, Rannditsheni said he has been paid only R282 000.
“In 2018-2019 I was given 100 000 from Nedbank but I didn’t get all the money because it was a cheque and I had to open a new account at FNB,” he said.
“I was told they would take R200 to open the account which I remained with R99 800. In 2022 I was given R100 000 then again R82 000. So far I was given R282 000.”
Rannditsheni said people who lost money, rather than municipalities, should be given priority to be paid back when law enforcement recovers the money. He added that should the bank be resuscitated, he could reconsider rejoining it.
“Matodzi misled us. That bank was managed by black and white people. I remember when Vho Tshifhiwa Maṭodzi once held a meeting at a hotel and he said all the white people are misleading us and they need to go,” he said.
The majority of the white executives, with the exception of Truter, left.
Rannditsheni said he believed the ANC was “afraid” to act against Radzilani because Matodzi had also said in his affidavit that she was part of the scheme to rob VBS.
“He is confirming that Florence Radzilani is also involved, meaning that she should step aside. I believe she must step down so that she can feel the pain we are feeling,” he said.
Robert Livhoyi, the secretary of the VBS Stakeholders Forum was established to ensure that the people who lost their money got it back. He said the intention was also to resuscitate the bank, which he had been banking with since 1987.
Despite the problems VBS has faced, people would still be willing to rejoin the bank because they knew its history, Livhoyi said.
“From 1987 to 2016, there was no problem. From 2016 leading to the disaster, there was a new board, so to us it tells us where everything went wrong,” he said.
“That’s why we are not even doubtful that the bank will come back to normality and people will trust and invest in the bank.”
Livhoyi said he still believed that those who lost their money in VBS would get it back.
“It’s heartbreaking and everytime I will say sorry, even though I’m among those who lost money. That’s why we are making sure that we go down to ensure that their investments come back,” he said.
“I believe that whatever went wrong, there’s a lesson that we as people should learn that people who come with a lot of promises, most of the time are not the right people.”
Livhoyi said he believed that sending people to jail would not bring the money back. Instead, he argued, law enforcement should follow the paper trail to recoup the funds.
“We want the money back. Anyone can go to jail but what we want is the money.”
Limpopo Premier Phophi Ramathuba said she “feels the pain” the VBS depositors are going through, adding that some people had developed depression and other illnesses after the institution went bankrupt.
She said the law enforcement agencies should be “allowed space” to do their work.
Ramathuba added that the ANC has policies — such as the step-aside rule — which can be invoked if any member of the party is charged over the VBS matter.
“So far we have not been given a directive that there could be anyone that is charged by the court of law who should step aside,” she added.