Free State corp to investigate VBS investment

Wednesday, October 17, 2018

The Free State Development Corporation (FDC) has announced it will launch an investigation into circumstances surrounding a R100 million investment into the troubled VBS Mutual Bank.  

In a statement released on Tuesday, the board of the FDC said it noted with concern being mentioned in ‘The Great Bank Heist’ report of the Prudential Authority of the SA Reserve Bank (SARB) as looter of the bank.  

In the report, which was released last week, the FDC is listed as one of the 53 individuals or entities that benefitted from suspicious payments from the bank, amounting to almost R1.8 billion in three years. 

Records of the FDC, said Grace Shaba, the FDC Divisional Executive of Core Operations, show that an amount of R100 million was invested with VBS Mutual Bank, which amounted to R104 417 749.75 with interest. The amount was repaid to FDC in four payments, subsequent to the maturity date of the investment, Shaba said. 

Of particular concern, said Shaba, is the fact that the FDC was not consulted before the report was released, which could have clarified the issue. 

The FDC said it has engaged with the SARB to obtain detailed information regarding what is alleged in the report. The body said it is committed to conducting a thorough investigation into the circumstances surrounding the investment that was made and the amount paid to FDC. 

Having allegedly received over R100 million, the FDC is the third highest beneficiary of the said payments. 

“[The FDC] is particularly concerned about the fact that [it] is mentioned as one of the parties, which may be involved in the looting of the VBS Mutual Bank, by receiving an amount of R104 130 932.00,” said Shaba. –