Gungubele ignores Postbank directors' resignations, fires them anyway

Communications minister Mondli Gungubele was on Thursday unshaken by the resignations of Postbank's directors,  saying he would have fired them anyway.

This comes in the wake of delayed social grant payments that left 600,000 people waiting for days.

On Tuesday, Postbank chair Thabile Wonci, Leigh Hefer-Hendrikse and Vuyelwa Matsiliza resigned from their board positions. Three other members were said to have followed suit and by Thursday morning only one board member had not resigned. Gungubele said he fired that person. 

This leaves the entity without any oversight board, which had  also included Ashley Latchu, Martin Mahosi, Gcobani Mancotywa and Letlhogonolo Noge-Tungamirai.   

The entity is left with CEO Nikki Mbengashe and company secretary Nobuhle Sibeko at the helm, whom Gungubele said  have been employed at the bank a mere two months.    

Among problems Gungubele said were the cause of a fallout between him and the board was the continuation of a “R140m illegal contract”. The contract is in relation to a company that renders a grant payment system to Postbank.

“The allegations were that Postbank has continued to use service providers that have not been lawfully contracted. These service providers are being paid millions without valid contracts and proper procurement processes being followed. [Advisory firm] KPMG recommended that the shareholder take action against the directors,” said Gungubele in an AGM on Thursday. 

Gungubele said the Postbank, under the board leadership, received bad reports from the auditor-general for three consecutive years.

He said resignations pre-empted his decision to remove them on Thursday. The minister mainly pinned the dissolution of the board on poor governance in the entity.     

“KPMG was appointed to conduct two forensic investigations into allegations of theft from Postbank through cash-out incidents. The amount that is reported to have been stolen from Postbank to date is about R120m.  

“This theft has been committed using existing accounts of Sassa beneficiaries, withdrawing cash at ATMs, thereafter, cleaning up the transaction history on that specific account so that the money transferred and withdrawn does not reflect. The report shows that the banking system of Postbank was intercepted, and employees of the bank have also been implicated in the process,” he said.

Gungubele said the department was in the process of appointing a new board. He appointed a special adviser to his office, Khayalethu Ngema, as the administrator of Postbank pending the appointments.

In a letter, the board members, including chair Wonci, said challenges experienced by the board were shared with Gungubele. The board had answered, on time, allegations levelled against it, the directors said.

“We believe that if the minister had a genuine interest in assisting the board to solve these legal issues for the benefit of Postbank, [he] would have provided an opportunity for proper engagement with the board and for the minister to provide a solution, if he had one, for the diametric consequences of either cancelling the contract with its financial and social impact on the hand and continuing with the current arrangement until alternative regular solution could be secured,” the letter reads.