Zim Chief Justice Luke Malaba’s nephew nabbed in R2 billion fraud
Chief Justice Luke Malaba’s nephew, Sipho Malaba, is being investigated over his alleged involvement in a R2-billion theft of VBS Mutual Bank funds.
According to News24 that anti-corruption officers from the Directorate for Priority Crime Investigation, or the Hawks, together with a team of National Prosecuting Service prosecutors from the National Prosecuting Authority (NPA) conducted a massive operation on Wednesday.
The paper said one of the people being investigated is former VBS and Vele Investments chairperson Tshifhiwa Matodzi who is alleged to be the kingpin of the theft of depositor’s funds from the bank.
Sipho Malaba was a chartered accountant who was the engagement partner on the 2017 VBS audit for KPMG.
Reports further said Malaba gave an unqualified audit opinion in circumstances where he knew the financial statements were misstated. He also gave a regulatory audit opinion which he knew to be false.
For his role in the alleged grand theft, Malaba is said to have been paid R33.9 million.
In 2018, KPMG suspended Sipho Malaba after VBS was placed under curatorship by the South Africa Reserve Bank.
The bank was placed under curatorship after it took large municipal deposits and lent them on a long-term basis and could not meet clients’ withdrawals when the money was required.
Economic Freedom Fighters’ officials Julius Sello Malema and Floyd Shivambu are accused of being beneficiaries of the grand loot.
Eight VBS suspects are due to appear in the Palm Ridge Regional Court on Thursday on 47 counts of fraud, racketeering, corruption, theft and money laundering.
The eight men accrued R122-million to themselves unduly, directly and indirectly, over several months, Hawks head Lieutenant General Godfrey Lebeya said during a media briefing on Wednesday.
Lebeya and national director of public prosecutions, advocate Shamila Batohi provided an update on an early-morning operation in Gauteng and Limpopo to nab the men, who they have not officially named.
News24 understands that among those arrested are former VBS chairperson Tshifhiwa Matodzi, who was described as the “kingpin” of the VBS looting scheme that resulted in more than R2-billion being stolen from the bank’s coffers.
Lebeya gave a detailed breakdown of the charges and confirmed that the arrests were accompanied by search and seizure operations. While he would not be drawn into detail, he did confirm the investigation was ongoing.
Of the eight men, four have been taken into custody, three are set to hand themselves over later on Wednesday and one man remains in quarantine due to Covid-19.
The men will face a cumulative of 47 counts, broken down as follows:
5 counts of a “pattern of racketeering activities” in contravention of the Prevention of Corrupt Activities Act
12 counts of common law theft
7 counts of fraud
15 counts of corruption in terms of contravening the Prevention and Combatting of Corrupt Activities act and;
7 counts of money laundering
This amounts to 46 counts in total, and it is unclear if Lebeya erred or omitted a count.
“The scam was hatched on the 4 July 2017 when the board of directors for VBS approved financial statements for the year ending 31 March 2017 making VBS to look richer while it was in fact insolvent. The financial statements were shockingly inflated,” Lebeya said.
News24 reported on Wednesday that in addition to Matodzi, the other men who will appear in court on Thursday include former VBS CEO Andile Ramavhunga and former Vele Investments and VBS chief operating officer Robert Madzonga.
Additionally former VBS treasury Phophi Mukhodobwane, former VBS chief financial officer Philip Truter and former non-executive VBS board members Ernest Nesane and Paul Magula are also set to be charged.
Nesane and Magula were employees of the Public Investment Corporation (PIC) who were seconded to the board to look after the PIC’s investment in VBS, as well as Phalaphala Ramikosi – former SAPS chief financial officer and a non-executive director of VBS. –ZimEye