Calls for action on VBS-linked officials

Political bosses to be summoned to shed light on ‘The Great Bank Heist’ reports on municipalities’ investments

NORTH West Premier Job Mokgoro has instructed four provincial municipalities – that invested more than R300 million in VBS Mutual Bank – to take action against its senior officials who undermined their political bosses and invested with the bank.

Mokgoro’s latest move comes as various political parties in the affected municipalities in the North West, Gauteng and Limpopo have embarked on protest action to demand swift action against those implicated.

In Gauteng yesterday, the DA’s motion of a vote of no confidence against Merafong Local Municipality’s Mayor Maphefo Mogale-Letsie was rejected during a full council meeting.

While the DA was pushing for the motion inside the chambers, Sanco protested outside the municipal buildings urging the provincial ANC under Premier David Makhura to act against all those implicated in the VBS scandal in Gauteng.

In Limpopo, the ANC has referred its deputy provincial chairperson Florence Radzilani and provincial treasurer Danny Msiza to the party’s national integrity commission for action to be taken against them. Some officials implicated in the corruption in the various Limpopo municipalities have also been barred from municipal buildings.

In the North West, four municipalities, Mahikeng Local Municipality; Moretele; Madibeng and Dr Ruth Segomotsi Mompati made a combined investment of R314 million of taxpayers’ money to VBS.

This prompted the provincial government to commission a forensic investigation which was conducted by Sekeka Xabanisa CA Inc.

The forensic investigation revealed that Dr Ruth Segomotsi Mompati District Municipality, of the four municipalities, invested R150m in February this year. The investment was apparently authorised by the newly appointed municipal manager Jerry Mononela and former chief financial officer Segomotso Phatudi.

The forensic investigation found that Dr Ruth Mompati municipality used R100m from its regional infrastructure grant; R25m from its equitable share – free basic services and another R25m from the building fund to invest in VBS.

The Madibeng Local Municipality invested R31m from its conditional grants; Mahikeng Local Municipality invested R83m – R23m from its Municipal Infrastructure Grants and R60m from its municipal equitable share – an overpayment from the National Department of Co-operative Governance and Traditional Affairs and Moretele Local Municipality invested R50m from its water service infrastructure grant.

In all these municipalities, the forensic report found that their respective municipal managers and chief financial officers played a central role in investing municipal funds without informing their respective mayors.

The report, however, did not reveal whether the implicated officials received any bribe for their investments. But according to the report “The Great Bank Heist” compiled by advocate Terry Motau – various VBS officials appointed middlemen to approach municipal officials and allegedly paid them bribes after VBS received the investment.

Now, Mokgoro, due to the outcome of the forensic investigation, has urged the different mayors to take disciplinary action against the implicated officials.

Mokgoro also endorsed the forensic outcome recommendation that the municipalities should follow appropriate procedures to seek condonation of “irregular investment and/or irregular expenditure from the National Treasury.”

Further recommendations included that the municipalities institute formal legal action within applicable confines against VBS Mutual Bank, now under curatorship, to try to recover amounts lost whether partially or wholly as may be determined by the administrators and/or the Reserve Bank.

The premier’s spokesperson Vuyisile Ngesi said Mokgoro is due to summon all political bosses of the affected municipalities “for further engage on the findings of this forensic investigation”.