MBOWENI SLAMS KPMG

FINANCE Minister Tito Mboweni yesterday condemned auditing firm KPMG for signing off on the financial statements of failed VBS Mutual Bank even though, according to a SA Reserve Bank report, it was clear that it had a shortfall of about R1 billion. “When you have a big auditing firm failing us in the manner that one has, that is a serious concern,” Mboweni told Parliament’s standing committee on finance. “I think we were failed by both the internal auditors and the external auditors. It seemed to have been part of the heist.” According to the report authored by advocate Terry Motau, former KPMG partner Sipho Malaba was rewarded R28 million by those who plundered VBS coffers. Mboweni, who served as Reserve Bank governor for 10 years, suggested that the central bank look at extending its onsite inspections to prevent a repeat of abuses such as those detailed at VBS. “The central bank had a capacity for onsite inspection, at some of the big banks we had onsite inspectors. Looking overall at the experience … the central bank has to be very mindful of what it can do in terms of inspections,” he said. Mboweni said he hoped that, in line with the call by Motau, there would be criminal proceedings against those who caused the failure of VBS through a brazen scheme of paying bribes to solicit deposits. Mboweni urged political parties to act against their members found to have benefited from the fraud scandal. Motau listed the brother of EFF chief whip Floyd Shivambu, Brian, among the individuals who gratuitously received millions of rand from VBS.