How disgraced Tshifhiwa Matodzi funnelled VBS funds via family

Former board chairperson of the now defunct VBS Mutual Bank Tshifhiwa Matodzi has confessed to using his family — even his elderly mother — and associates' entities to channel funds and receive irregular benefits for self-enrichment.

His affidavit, filed as part of a plea deal with the prosecution which saw him receive an effective 15-year jail term in the Pretoria high court, details how he plundered the bank.

Matodzi implicated his mother, his brother and two sisters but cleared his ex-wife whom he said wasn't aware of the corrupt activities.

Once he became a shareholder in the bank, his mother Stephinah Alidzulwi Matodzi, 74, opened personal and business accounts at VBS. When VBS shares became available, he gave her money to purchase them.

Matodzi, who was also executive chairperson of Vele Investments, tasked Phillip Tshililo, then a branch manager at VBS Thohoyandou, to transfer money into her VBS accounts whenever she requested it.

“At times I would arrange for her to collect cash from Tshililo. This money would have been debited from one of my personal or Vele accounts in VBS,” he said. 

His mother was listed as the director or the trustee of three companies: Africasana, Shimba la Ndou Trust and Masindi Resort. She did not control the first two. Africasana received an overdraft of R4.5m from VBS while the Shimba trust received about R14m — R7m as a mortgage bond and R7m as an overdraft. He said she controlled Masindi Resort but this company received no money from VBS.

In 2016, a continuing coverage mortgage bond was registered regarding a Thohoyandou property owned by his mother.

“The covering bond was registered for R5m. This was done in case my mother applied for an overdraft to finance her bakery business in Africasana in future and the property would stand as surety for the loan.

“All bank processes were followed in the registration of this covering bond and the property was independently valued at R3.5m. She, however, never applied for any loan.

“Africasana was later used by myself through Vele and an overdraft of R5m was loaded without her knowledge. I used the facility in Africasana to make various payments, mostly for Vele-related issues. There were payments processed from Africasana VBS bank account for purchases of items for her house. These payments totalled about R1.2m.”

Siblings

Aluwani Matodzi, his sister, was granted motor vehicle finance and a home loan between 2016 and 2018. Matodzi assisted his sister with her bond application documents. He employed her to consult Vele regarding starting a fleet management company, as she had expertise in the area.

“I offered her a monthly fee of R30,000. At the time of her bond application with VBS, I requested a company called Proforum Accountants to draft a proof of income letter for income of R107,000 on her behalf.

“The basis for the letter was the R30,000 income she received from Vele and a contract her company Winisource had with a client called MK Exotics. MK Exotics was paying Winisource a monthly rental fee of about R44,000.”  

Matodzi said the balance of Aluwani's income was from ad hoc invoices with her clients which he did not verify.

After April 2018 and post-curatorship, Aluwani continued to pay instalments from her funds/employment and the account has since been fully settled and closed.

Matodzi would occasionally gratuitously assist his other sister, Shonisani Difotso, with money whenever she was in need. Mostly this involved assisting her with personal expenses, debts and her child's university tuition fees.

“My estimated total financial assistance from 2016 to 2018 is about R360,000. Shonisani did not have any credit or loan facilities with VBS.”

He employed his brother Takalani Matodzi in Venmont Build Environment, a subsidiary of Vele, in 2015. Takalani's duties were to source land, mainly for residential developments. 

Takalani presented land sourced to Matodzi for approval as Matodzi was responsible for organising finance.

“At Venmont Takalani was not involved in the day-to-day administration, which would have included the payments from bank accounts or organising overdrafts and loan facilities. Overdrafts in this company's accounts were arranged through Vele by myself without Takalani's knowledge,” said Matodzi. 

Companies controlled by him through Vele, in which Takalani held directorships, were Venmont Holdings and Robvet.

In 2017 Venmont's overdraft of R15.7m was cleared.

“Takalani was not aware of the Venmont overdraft or the subsequent clearing.

“The financing was sourced from VBS through my interventions and mortgage bonds were registered against these properties. During the early stages when I was not yet the chair of VBS, I personally provided security against the first land purchase using my property in Eagle Canyon as additional security.”

Robvet was incorporated on April 22 2016 with Takalani as sole director but he resigned from this company on May 13 2016.

“I only became aware of Robvet sometime in 2016, when I was having discussions regarding commission payments with Solly [Solomon Maposa, GM of credit at VBS]. Solly mentioned he uses a company called Robvet to pay commissions. I enquired from Solly who the director of the company was and Solly said it was his cousin Rabelani Ramuntshi. I left it at that and I also started using the company as a slush fund for payment of agent commissions and at times my own personal expenses.”

Matodzi appointed his ex-wife Thabelo Grace Matodzi in 2017 as CEO of a new Vele subsidiary, Venmont Foods.

“All facilities and overdraft of Venmont Foods were arranged directly by myself. Thabelo was not aware of the corrupt activities at VBS and Vele,” he said.

Their divorce was finalised in 2018, with Matodzi paying her a spousal allowance of about R100,000 a month. His affidavit states, “this was as compensation for her being a housewife and no longer working as a chartered accountant”.

VBS was formed as Venda Building Society in 1982 and became a mutual bank in 1992. By 2016, the bank reportedly had about 30,000 depositors and deposits totalled R800m.

In 2018, VBS was declared insolvent and bankrupt, with citizens and taxpayers defrauded of about R2bn, and placed under curatorship.

A Reserve Bank report compiled on its behalf by advocate Terry Motau found the bank conducted business in a fraudulent and reckless manner, resulting in widespread impoverishment of its depositors for the benefit of its senior managers, politicians and some board members.

In 2020, former VBS Mutual Bank CFO Phillip Truter was jailed for seven years. He admitted misstating the bank’s financial statements and receiving gratification of R5m from Matodzi to facilitate the widespread impoverishment of VBS’s depositors for the benefit of the then chairperson and his associates.

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