Fin24.com | Ramaphosa: We are ashamed of what happened at VBS Mutual Bank

What has happened at VBS Mutual Bank is shameful, and those responsible must be dealt with in terms of the law, said President Cyril Ramaphosa.

He was speaking to eNCA's Jane Dutton about the mutual bank in a wide-ranging interview on Monday night. The president recently concluded a three-legged visit to oil-producing countries Nigeria, Saudi Arabia and the United Arab Emirates.

The South African Reserve Bank (SARB) placed VBS Mutual Bank under curatorship in March as it faced a liquidity crisis after municipalities withdrew their deposits. Subsequent to the curatorship, the bank has been caught up in an ongoing fraud saga. It is alleged that R1.5bn was looted by executives, Fin24 previously reported.

“What happened at VBS is really a shame not only to the people of Venda or Limpopo but the people of South Africa as a whole – and ordinary women who save their money for burial societies. We are really ashamed about what happened,” Ramaphosa said.

He admitted that there have been criticisms of current regulatory processes for mutual banks, which is less stringent than those for commercial banks. “Some have suggested that the rules and regulations are too lax,” he said. There was “obviously a lapse” in terms of the power given to the Reserve Bank to guide the mutual bank.

But Ramaphosa was hopeful in the steps taken to ensure depositors recover their money. “We would like to save VBS, it has a good brand name. It has served the people of Limpopo very well and it got lost along the way because there were people who had ill intent,” he said.

‘Thieves, robbers and scoundrels’

Those responsible for what has happened at VBS Bank must be dealt with in terms of the law, said Ramaphosa. They had raided money from the bank, taking from the poorest of the poor and from municipalities which were meant to use the money for projects, he pointed out.

“There has to be follow-up and accountability there because it is money stolen from our people.

“Maybe we should stop using euphemisms and we must call these people thieves because that is precisely what they are – they are thieves, robbers and scoundrels,” said Ramaphosa.

“People who take money from ordinary grandmothers who put money there for their life savings as well as for their burials, have to be called exactly what they are – thieves.”

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