Three more people arrested for VBS scandal, total arrests now at 23

A total of 23 people have been arrested in connection with R2 billion lost due to alleged fraud and corruption where municipal monies was invested and then paid out to selected people.

VBS Mutual Bank in Thohoyandou. Picture: Sethembiso Zulu/EWN

JOHANNESBURG - Three more people were on Tuesday morning arrested in connection with investing municipal funds with VBS Mutal Bank.

The three suspects, who have not appeared in court yet and therefore cannot be named, are a 57-year-old former municipal manager of the Fetakgomo-Greater Tubatse Municipality, a 39-year-old former chief financial officer and a 41-year-old business owner. They were arrested this morning at their residences around Pretoria.

An in-depth investigation into the plundering of VBS funds was jaw-dropping. The South African Reserve Bank released Advocate Terry Motau's report, which implicated 53 people and companies in fraud and corruption worth nearly R2 billion. The money was wasted due to funds allegedly given to Vhavenda King Toni Mphephu Ramabulana and other executives, as well as politicians in the Economic Freedom Fighters (EFF) - such as Julius Malema and Floyd Shivambu - and African National Congress (ANC) parties.

- From bank heist to arrests, a timeline of the VBS scandal
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- Brian Shivambu to pay back R4.5m received from looting of VBS - report

More than 20,000 retail customers who had deposits of less than R100,000 had their claims honoured by the Reserve Bank.

The South African Police Service released a statement on Tuesday saying that the allegations against the trio, if proven true, contravened the Municipal Finance Management Act for investing municipal funds with VBS Mutual Bank. The investigation revealed that Fetakgomo-Greater Tubatse Local Municipality invested an amount of R230 million, which was paid in five tranches from 15 November 2016 to 19 February 2018. The whole amount invested was never paid back to the municipality.

Brigadier Nomthandazo Mbambo confirmed that the total number of arrests to date now stood at 23.

The three will appear at the Pretoria Specialised Commercial Crimes Court on Wednesday for contravening the Act, corruption and money laundering.