The Economic Freedom Fighters (EFF) has welcomed the arrests of suspects linked to alleged looting of funds at the collapsed VBS Mutual Bank – but insisted that its leaders have not committed “wrongdoing or criminal activity.”
In a statement on Wednesday, the party said the arrests provide an opportunity for “hard facts and evidence” to be presented in court, “thereby removing the media campaign and slander that has been ongoing since the release of the SA Reserve Bank report on improprieties at the bank.”
It added, “We further welcome the commitment by the DPCI that no stone will be left unturned in conducting these investigations and that everyone involved in the wrong will be held accountable.
“The leadership of the EFF reaffirms its statements and articulations that despite the many factional and politically influenced allegations against its leadership, there is no wrongdoing or criminal activity committed by its leaders.”
‘Innocent until proven guilty’
The EFF said it will “closely monitor” the developments and expressed its belief that the process will be “free and fair so that justice prevails.” It also hoped that the legal principle of ‘innocent until proven guilty’ would be applied.
The statement came hours after the Directorate of Priority Crime Investigation (DPCI) head, Lieutenant-General Godfrey Lebeya, and National Director of Public Prosecutions, Advocate Shamila Batohi, announced the arrests.
They said the DPCI had conducted simultaneous search and seizure operations in 10 premises in Gauteng and Limpopo. It arrested seven suspects on various charges, including racketeering, theft, fraud, corruption and money laundering. An eighth suspect is in quarantine and will be arrested later.
Among those arrested were the Bank’s former chairperson Tshifhiwa Matodzi, chief executive Andile Ramavhunga, treasurer Phophi Mukhodobwane and chief financial officer Philip Truter.
The charges relate to “a general deficiency in the monies received by VBS amounting to R2.29 billion,” Batohi said.
She added, “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.
“The investigation has revealed that individuals and/or companies of the suspects unduly directly or indirectly benefitted at least R122,287,863.”
20 municipalities had deposited R3.7 billion at the Bank, of which R2.2 billion was recovered. The suspects are set to appear at the Palm Ridge magistrate’s court in Johannesburg on Thursday.
EFF and VBS
The EFF and its leaders, Julius Malema and Floyd Shivambu, have been dogged by allegations that they benefitted from funds allegedly looted at VBS.
Earlier in June, Daily Maverick‘s investigative journalism unit Scorpio published alleged WhatsApp messages showing Matodzi allegedly directing payments of VBS funds into the bank account of Sgameka Projects.
Sgameka’s director was Brian Shivambu, the brother of Floyd Shivambu. According to Scorpio, Floyd and Malema were the actual beneficiaries of those funds.
Scorpio has previously claimed that more funds from VBS, totalling around R5.3 million, allegedly went to Mahuna Investments, a company associated with Malema’s cousin Matsobane Phaleng.
Both Malema and Shivambu have consistently denied wrongdoing.