Former VBS boss only heard of ‘looting’ after it happened, advocate argues

An application to have the estate of Robert Madzonga, VBS’s previous chief operations officer and the group executive officer of Vele Investments, provisionally sequestrated is current before the court. (Photo: Caryn Dolley, News24)
An application to have the estate of Robert Madzonga, VBS’s previous chief operations officer and the group executive officer of Vele Investments, provisionally sequestrated is current before the court. (Photo: Caryn Dolley, News24)

A former VBS Mutual Bank boss only found out about alleged plundering of R1.5bn from the institution just before it was placed under curatorship, an advocate has told the South Gauteng High Court.

Intense arguments were heard on Wednesday around whether or not Robert Madzonga, VBS’s previous chief operations officer and group executive officer of Vele Investments, should be provisionally sequestrated.

During proceedings on Wednesday, Jonathan Blou SC, Madzonga’s advocate, said his client only became aware of the looting on March 11 this year.

This coincided with when VBS was placed under curatorship. SizweNtsalubaGobodo Advisory Services (Proprietary) Limited, represented by Anoosh Rooplal, was appointed to deal with this.

In an affidavit, Rooplal had named Madzonga as being among the “controlling minds” behind the alleged fraud saga.

Blou on Wednesday argued that Rooplal had based his own affidavit on one by  Phophi Mukhodobwane, the bank's general head of treasury and capital management, and that this was hearsay.

Other VBS executives have also become the focus of court action.

Andile Ramavhunga, VBS’s chief executive officer, may also be placed under provisional sequestration - this was argued in court on Tuesday and a judgment is yet to be delivered.

On Tuesday provisional sequestration orders were granted against Tshifiwa Matodzi, the former chair of VBS’s board of directors and also director and chairperson of Vele Investments, as well as  Phillip Truter, the bank's chief financial officer; and Mukhodobwane.

Vele Investments, VBS’s main shareholder which allegedly also benefited from alleged fraud carried out by bank executives, was also liquidated.

It emerged in court on Wednesday that Mukhodobwane wants to appeal the provisional sequestration.

Blou on Wednesday argued that Madzonga became the group execute of Vele in September 2017 when alleged fraudulent activities had apparently started in March that year already.

He had earlier argued that a payment of R4.5m was the only thing linking Madzonga to the alleged R1.5bn plundered from VBS and that the main witness in the matter, Mukhodobwane, had not linked his client to fraud.

Madzonga, according to Blou, had said the R4.5m was received as he had been promoted.

Michael Antonie SC, who is legally representing the curator, had earlier argued that in February 2018 Madzonga had seen that a total of R18m was paid to VBS.

Antonie had said the R18m payments to VBS were unusual in that Mukhodobwane, as a senior VBS staffer, had contacted Madzonga, in his personal capacity and at the same time head of the bank's biggest shareholder, asking him “to solve the liquidity crisis at the bank”.

The payments, Antonie alleged, were to try and conceal the fact that VBS could not pay its creditors.

The matter is expected to resume on Friday.

* SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
ZAR/USD
16.37
(-0.40)
ZAR/GBP
21.52
(-0.33)
ZAR/EUR
19.41
(-0.26)
ZAR/AUD
11.62
(-0.11)
ZAR/JPY
0.16
(-0.33)
Gold
1913.63
(-0.40)
Silver
24.77
(-0.66)
Platinum
885.00
(+0.20)
Brent Crude
42.06
(-3.35)
Palladium
2398.00
(+1.07)
All Share
55345.49
(+0.13)
Top 40
50905.12
(+0.11)
Financial 15
10138.60
(+1.83)
Industrial 25
74577.70
(-1.31)
Resource 10
54447.94
(+1.23)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
Yes, and I've gotten it.
27% - 41 votes
No, I did not.
48% - 74 votes
My landlord refused
25% - 39 votes
Vote