About R730 million of the billions looted from VBS Mutual Bank has been recovered so far, as efforts to trace and return the stolen funds continue. Image: EWN
(The Post News)- It’s been nearly seven years since the collapse of VBS Mutual Bank shocked the country. Now, the South African Reserve Bank’s Prudential Authority says about R730 million has been clawed back from the wreckage, a sliver of hope in what was once a R2.3 billion scandal.
According to the PA’s latest annual report, collection efforts have made “significant progress,” with funds already being distributed to some of the bank’s proven creditors. The figure recovered so far accounts for roughly a third of what was looted before the bank was liquidated in November 2018. Liquidator Anoosh Rooplal confirmed the numbers. “The significant dividends have already been paid,” he said, referencing two payouts to creditors, R159 million in 2022 and R458 million in December 2024. In total, that’s R617 million already disbursed. The process, Rooplal said, is ongoing.
VBS Mutual Bank’s downfall grabbed national attention in 2018 when Advocate Terry Motau released a forensic report called ‘The Great Bank Heist”. The investigation exposed a complex scheme of fraud and theft involving bank officials, politically linked figures, and state institutions. Among the biggest casualties were municipalities and pensioners who had entrusted their money to the bank. So far, 29 criminal cases have stemmed from the bank’s collapse. Nine of those are currently before the courts, and five have resulted in convictions.
The Prudential Authority says it remains focused on recovering the rest of the looted funds and holding those responsible to account.
But while the VBS clean-up continues, another troubled institution is now under scrutiny. The PA is also trying to place Ithala SOC Limited, better known as Ithala Bank, into liquidation, alleging it was illegally taking deposits. That move has sparked backlash from KwaZulu-Natal’s provincial government, which is opposing the application in court. Francois Rodgers, the DA’s MEC for Finance in the province, told Business Times the Reserve Bank’s actions have left depositors locked out of their own funds. “Some people have hundreds of thousands they can’t access, that’s wrong,” he said.
To protect customers, Finance Minister Enoch Godongwana approved a R2 billion guarantee earlier this year to cover deposits belonging to over 220,000 Ithala clients. The idea is to transfer those funds to licensed banks, but the process has been slow.Meanwhile, Reserve Bank Deputy Governor Fundi Tshazibana says South Africa’s banks may see some breathing room as inflation stabilises. Still, she warned that global instability and deregulation trends continue to pose risks.
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