Cape Town — Former chairperson of the Venda Building Society (VBS) Mutual Bank, Tshifhiwa Matodzi, has alleged that Economic Freedom Fighters (EFF) leaders, Julius Malema and Floyd Shivambu pocketed R16.1 million from the bank.
Matodzi was sentenced to 495 years in prison for orchestrating the looting of the collapsed bank. After pleading guilty to charges of racketeering, theft, fraud, and money laundering, he received a 15-year sentence, EWN reported.
Matodzi explained in an elaborate affidavit how his relationship with the EFF began after the party publicly criticised VBS for granting a loan to Jacob Zuma for his Nkandla residence.
He recounted meeting Malema and Shivambu at a penthouse in Sandton, where they agreed that the bank would transfer R5 million to the EFF through Sgameka, a company owned by Shivambu’s brother, Brian.
Matodzi stated that he, Malema, and Shivambu understood the donations as gratifications, which would later be formalized through a bogus contract for work in petroleum and storage facilities.
Malema has denied ever meeting with Matodzi or having any dealings with the bank.
JUST IN:
Explosive evidence by Tshifhiwa Matodzi in an affidavit he signed directly implicates the EFF’s Floyd Shivambu and Julius Malema in the VBS corruption scandal. This is the first time direct evidence has surfaced about the scandal. pic.twitter.com/blOZzR4ZTA— Ismail Abramjee (@IsmailAbramjee) July 11, 2024
As part of a 263-page witness statement, Matodzi implicated Malema and Shivambu were paid to not use the EFF’s political power against VBS Bank, The Citizen reported.
Matodzi said Malema and Shivambu both knew that the funds received from VBS were unlawful because they created Sgameka as a front. He also said there was no legitimate business reason for the payment, with Malema and Sivambu saying they needed the money for their restaurant in Soweto.
“To my knowledge, Sgameka is a company owned by Brian Shivambu, a brother to Floyd Shivambu who is the deputy president of EFF. The company was provided to me by Floyd to make payments that I promised to EFF,” he said.
Matodzi said, as chairman of VBS, he decided that Malema and EFF should be approached by VBS to explain its position and how the loan was granted.
“I further informed them that VBS was willing to offer a donation to the EFF. I then proposed that VBS can donate R5-million immediately once a bank account has been opened at VBS and R1-million per month to the EFF. I also made it clear that the amount could only be deposited into a VBS account, and that EFF should therefore open a bank account with VBS,” Matodzi said.
Matodzi alleged that he gave Malema and Shivambu the name of David Nthlokwe, a general manager at VBS, who would oversee a “loan”.
“This loan application was made through Sgameka and was approved. Although I do not know the amount,” he said.
So Floyd Shivambu and Julius Malema were bribed by Tshifhiwa Matodzi so the EFF stops talking about the VBS loan for Jacob Zuma in the media? And these easily bought individuals is who you think will bring you economic liberation? Shame. Them boys are in it for their pockets. pic.twitter.com/xlSkWi8yFU
— Big Mo (@MogomotsiLebot2) July 11, 2024
TimesLIVE reported that Matodzi had falsified records, misled the board, issued instructions without authority, and promoted unlawful activities, to collapse VBS.
“After becoming chair of the VBS board, I would regularly make requests for loans and/or overdraft increases for use by my companies or those associated with me,” he said.
Matodzi was involved in a rogue deposit-suspense accounts creation scheme with a few other colleagues in the bank. He said these accounts were the main cause of VBS’ collapse through availing non-existent cash to Vele and its entities.
The scheme meant creating fake deposits into suspense accounts which were later credited to companies owned by him, his associates, and family members. The deposits were immediately available for use even though no cash was deposited.
He used this money to acquire big companies and fund an expensive lifestyle at the expense of real depositors, but it became out of control because of its easy nature that it lost the ability to control cash management and liquidity control.
“There were uncontrolled withdrawals of money by us that never existed. The greed by myself involved prioritising my payment plans over those of legitimate needs of VBS to lend money to qualifying clients or to invest excess money in liquid money markets.”
Through the creation of the fake deposits, he obtained majority control of the bank through the acquisition of VBS shares.
When Matodzi was involved in falsifying financial records and misleading the board, he participated in the preparation of the financial records for the annual financial statements, the Public Investment Corporation, and auditors, misleading them while knowing the true state of affairs.
His meddling in the executive functions compromised, misled and weakened the board to a point at which it couldn’t perform its duties.
Former VBS boss Tshifhiwa Matodzi spilling everything on his explosive witness statement. Let it be known that your so called black revolutionaries didn’t think twice when they were collapsing a Bank meant to cater for poor black people. Their supporters called Pauli a mad woman.… pic.twitter.com/hF8LPwIRAc
— SITHALE✍🏿 (@SithaleKgaogelo) July 12, 2024
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Compiled by Matthew Petersen
