Hunt for VBS loot starts

Loan accounts remain valid and enforceabl­e

- By Isaac Mahlangu

Now that the embattled VBS Bank will be liquidated, the hunt for the bank’s looted billions will also kick in. The SA Reserve Bank (SARB) yesterday said it will make sure that “as much money as possible can be recovered on behalf of the depositors”. SARB spokespers­on Ziyanda Mtshali said: “The liquidator will now proceed with the winding up of VBS Mutual Bank. This process will include recovering assets and distributi­ng any proceeds from recovered assets in the interest of all creditors.” This followed yesterday’s ruling by the North Gauteng High Court in Pretoria to grant the central bank an order to liquidate the bank and bring to an end efforts to try and save it.

The court also granted the Mahikeng local municipali­ty in North West leave to intervene in the matter.

The municipali­ty illegally made four deposits with varying amounts of between R4m and R60.1m with the bank between August and December 2017.

VBS curator Anoosh Rooplal said the liquidatio­n of the bank did not, however, mean those who owe the bank were off the hook.

“Even though the high court has ordered that the VBS be liquidated, loan account holder contracts remain valid and enforceabl­e,” Rooplal said. He added: “Loan account holders are urged to continue to pay their monthly instalment­s in order to avoid recovery action being taken against default payers.” Rooplal has also been recommende­d SARB to become VBS’s liquidator.

VBS saw around R2bn belonging to poor depositors and municipali­ties looted allegedly by employees, shareholde­rs and politician­s. Experience­d curator and liquidator Christophe­r Roos

said what’s going to follow would be the appointmen­t of several other liquidator­s by the Master of the High Court, who will launch an investigat­ion into the VBS affairs.

“In my opinion, without

prejudice, I think this matter will take some years to finalise as there will be numerous court cases; to collect the outstandin­g debts, there may be criminal charges laid, depending on the findings of the investigat­ion,” Roos said. He said in some cases, the liquidator­s of VBS will bring a court applicatio­n for the liquidatio­n or sequestrat­ion of the debtors of VBS “if they do not or cannot repay the money, depending on how and why the funds was paid over to them”.

SARB convinced the court, without anyone opposing its applicatio­n, that there was no way VBS Bank could be saved as its liabilitie­s outweighed its assets by several hundreds of millions of rand.

SARB stated that the “amounts on call and at shortnotic­e” had been fraudulent­ly overstated by R700 000 in the 2017 annual financial statements.

“VBS is hopelessly insolvent, both factually and commercial­ly. Against the background of massive frauds and the theft of depositor funds it is of necessity and in the interests of the creditors of VBS and the public, that VBS is wound-up as a matter of urgency,” chief executive of the SARB’s Prudential Authority, Kuben Naidoo, stated in court papers.

 ?? / ANTONIO MUCHAVE ?? Clients of VBS Mutual Bank in Thohoyando­u. The high court in Pretoria has granted an order for trhe bank to be liquidated.
/ ANTONIO MUCHAVE Clients of VBS Mutual Bank in Thohoyando­u. The high court in Pretoria has granted an order for trhe bank to be liquidated.

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