The liquidators of the collapsed SME Bank Namibia managed to freeze millions of rands sitting in South African bank accounts last week as part of an investigation into a lesser known scandal in which VBS Mutual Bank allegedly played a key part.
SME Bank was liquidated last year when it turned out that R155 million it supposedly deposited in VBS in South Africa did not exist. Instead, there was R459 000 in its VBS account.
The impairment on SME’s books caused by this missing cash immediately rendered the small Namibian lender insolvent.
It is not certain how much of SME Bank’s money was in VBS because SME’s former CEO Tawanda Mumvuma and VBS have provided wildly different, and contradictory, versions.
Last week, the liquidators of SME got a court order in Johannesburg to freeze four accounts at FNB that allegedly contained about R50 million of the money that was supposed to have been in VBS.
These accounts belong to two East Rand, Johannesburg, companies called AMFS Solutions and Moody Blue Trade & Invest 14.
When contacted by City Press, the director of AMFS, Carlo Stickling, said it was all a big mistake and referred City Press to his lawyer, Saleem Ebrahim.
Ebrahim was unable to comment, citing meetings.
The fate of SME’s money remains a mystery.
Back in 2015, SME struck a deal with a South African company called Mamepe Capital.
Mamepe in turn signed an agreement with VBS whereby VBS would provide banking facilities to be used in Mamepe’s management of SME’s money.
According to testimony given to forensic investigators in the unrelated probe into VBS, Mamepe’s owner Mauwane Kotane and VBS CEO Andile Ramavhunga are childhood friends and business associates.
In an affidavit before Namibian courts, SME CEO Mumvuma had sworn that SME had R155 million spread across a number of fixed-term deposits at VBS.
However, Ramavhunga said in his own affidavit that SME accounts at VBS had only received R70 million, of which R37 million was paid to SME and the rest legitimately withdrawn by Mamepe under its deal with SME.
The Bank of Namibia, the country’s central bank, took over SME and found that, in fact, there was no investment at VBS, but that millions were paid to various accounts at other South African banks.
An affidavit from Kotane said that R175 million had been used to buy fertiliser for “trading purposes”.
An ongoing forensic investigation commissioned by the liquidators of SME kicked off in South Africa last week, with FNB and Standard Bank subpoenaed to provide details of accounts where SME money had evidently actually gone.
Immediately afterwards, the application to freeze four accounts was made in the Johannesburg High Court.
Kotane will provide evidence to the SME investigators next month.* SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.