75% of VBS assets may have been stolen by its management – report
However, according to reports, it is difficult to determine the amount stolen from the bank in relation to its assets.
A closed VBS Mutual Bank branch, 9 July 2018. Picture: Facebook
VBS Mutual Bank’s executives and directors may have stolen 75% of the bank’s assets. This was suggested by the South African Reserve Bank (Sarb) on Monday, the Business Day reports.
The Reserve Bank held a media briefing on Monday where Sarb governor Lesetja Kganyago announced steps to be taken by clients to gain access to their funds, beginning on Friday.
The Business Day quoted Kganyago as saying VBS’s management had put many depositors at risk because of its failures.
R1.5 billion was recovered on Friday by curator Anoosh Rooplal from VBS’s largest shareholder, Vele Investments, and from the bank’s executives and directors as a way of preventing a further “dissipation of assets”, according to the report.
However, because VBS had deliberately misled the regulator and because of issues with the quality of its audit, it is difficult to determine the amount stolen from the bank relative to its assets, it is further reported.
According to the Business Day, damages could still be sought from VBS’s external auditor, KPMG, and its internal auditor, PricewaterhouseCoopers, once the forensic report has been concluded.
Meanwhile, VBS’s retail depositor learned with relief on Monday that they would gain access to their funds.
It is estimated that about 97% of the 22 700 VBS retail depositors will receive all of their money, according to the Sarb.
Kganyago said the process followed discussions with National Treasury, leading to government providing a guarantee to Sarb to facilitate the repayment of all retail deposits up to R100 000 a retail depositor, excluding municipal or corporate deposits.
Depositors are defined as individuals, burial societies, stokvels and saving clubs that made deposits in VBS.
Kganyago said: “We have decided to use Nedbank to facilitate the repayment of retail depositors. The criteria for selecting a repayment medium included proximity to depositors, cost, speed of execution, having multiple mediums and advice by the VBS curator.”
VBS branches would not be able to provide cash withdrawal services from tomorrow onwards. This was to facilitate a smooth transfer of personal and account data from VBS to Nedbank.
“Some retail depositors have larger amounts deposited in VBS. Together with the curator, the Sarb and Prudential Authority will continue to work towards recovering as much money owed to VBS as possible.”
Kganyago said the forensic investigation into VBS led by advocate Terry Motau into fraud and malfeasance was still in progress.
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