Land Bank covered up huge theft

2008-08-13 00:00

Land Bank bosses tried to cover up the theft of promissory notes and bills of exchange worth millions that were stolen from the bank’s treasury last year. They also allegedly failed to report the robbery to police.

A Beeld investigation has discovered that promissory notes and bills with an estimated value of R28 million disappeared in October or November last year from the bank’s treasury, which could not be locked because the security door was malfunctioning.

The bank discovered the theft of the 25 promissory notes and three bills — printed in denominations of R1 million each — only when it was contacted by First National Bank on November 20, 2007, after one of the bills was tendered for payment at an FNB branch in Standerton.

An FNB spokesman, Steve Higgins, yesterday confirmed the incident.

That same day the Land Bank’s then head of treasury, Makgale Gwangwa, sent a memo detailing the situation to senior management, and urging immediate action. The memo noted that the problem with the door was reported, but took several weeks to be fixed. “During that period anyone had free access to the treasury.”

He pointed out that the stolen items were taken from a locked safe, and urged senior Land Bank officials, including the then acting CEO, Dr Phil Mohlahlane, acting head of internal auditing Betty Dhlamini and chief financial officer Xolile Ncame to “report this theft to the SAPS without delay”.

He called for a stringent check “to determine who had access to the treasury room”.

“Please regard this investigation with the utmost urgency.”

Gwangwa did not want to comment yesterday, but according to Beeld’s sources nothing ever happened.

Beeld has confirmed that the National Treasury — which took over management of the Land Bank from the Land Affairs and Agriculture Department last month — was told of the robbery only this week.

The Land Bank has been rocked by corruption scandals and allegations of financial mismanagement. In the 2006/2007 financial year, the bank reported a loss of R100 million.

Thoraya Pandy, National Treasury spokeswoman, said yesterday that after the theft, the Land Bank “took steps and … put in place an effective monitoring system”. She said the Scorpions are investigating.

But Scorpions spokesman Tlali Tlali said yesterday: “No such case has been reported to the Scorpions.”

Later Pandy contacted Beeld to correct her earlier comment. “There will now be an investigation,” she said. Beeld understands that following the newspaper’s queries, Land Bank officials contacted the Scorpions to find out how they could formally register a case.

Pandy said she was advised that “the bank didn’t suffer any financial loss and dealt with the matter almost immediately, telling clearing banks not to honour any of the instruments”.

But according to one of Beeld’s sources, “that means nothing”.

“The public were never notified. These things are legal tender, so if someone bought cows from a farmer and gave him one of these promissory notes, the guy would only find out it had been stopped when he went to the bank. By then it is too late. The cows are gone. Somebody will suffer losses.”

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