Fraud charges against 15 municipalities after banking with VBS

The offices of Vele Investments, majority shareholder of VBS Bank on Grayston Drive, Sandton. Reserve Bank on Monday conducted a mid-morning search and seizure operation as part of its ongoing probe into the bank which was placed under curatorship in March.
The offices of Vele Investments, majority shareholder of VBS Bank on Grayston Drive, Sandton. Reserve Bank on Monday conducted a mid-morning search and seizure operation as part of its ongoing probe into the bank which was placed under curatorship in March.
Image: Kyle Cowan

The Democratic Alliance has laid charges of fraud against officials of the West Rand district municipality and other municipalities in terms of the Municipal Financial Management Act‚ for allegedly illegal deposits made with VBS Mutual Bank.

VBS Mutual Bank is now under curatorship.

The West Rand district municipality is one of 15 municipalities which made deposits with VBS‚ despite an instruction by National Treasury against this practice.

The DA will also be laying charges against officials at the other 14 municipalities who were complicit in these illegal deposits. They include Vhembe district municipality:

- Fetakgomo Greater Tubatse municipality‚

- Lepelle-Nkumpi municipality‚

- Limpopo 345 municipality‚

- Dr Ruth Segomotso Mompati district municipality;

- Mafikeng municipality; Ephraim Mogale municipality‚

- Makhado municipality‚

- Madibeng municipality‚

- Merefong municipality‚

- Elias Motsoaledi municipality‚ and

- Dr JS Moroka municipality.

"Some of the implicated municipalities are among the worst-run and most financially unstable municipalities in the country‚ and with the liquidity crisis at VBS‚ the municipalities are now at risk of losing their combined R1.5-billion in deposits‚" said DA spokesperson on cooperative governance and traditional affairs Kevin Mileham.

"It is unacceptable that municipal officials‚ who have a clear mandate to deliver service to the people‚ abuse their powerful positions and unduly access money which should be used for service delivery."

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