'Paying' Jacob Zuma gets reprieve from VBS

Accountants go after many others who owe bank millions

28 April 2019 - 00:05 By MPUMZI ZUZILE


Monthly repayments are continuing on former president Jacob Zuma's R7.8m loan from VBS Mutual Bank, meaning he will avoid legal action by the bank's liquidators.
But others are not so lucky.
The liquidators from accounting firm SizweNtsalubaGobodo (SNG) Grant Thornton said this week that anyone who had borrowed money from the bank and had not begun paying it back, or defaulted on payments, would be in their firing line.
SNG Grant Thornton executive Anoosh Rooplal told the Sunday Times the liquidators were not pursuing Zuma as "he is servicing his housing loan".
Last year the Sunday Times reported that Zuma started repaying the VBS loan, which he took out to pay for his Nkandla homestead, only 18 months later when VBS was put under curatorship in March last year.
Around the same time that Zuma was given the loan, he elevated Toni Ramabulana, who owned a 20% stake in VBS, to the Venda throne.
A rival claimant challenged the decision and last week the Supreme Court of Appeal in Bloemfontein ruled that Ramabulana's appointment as king was invalid. It referred the case back to the high court for further argument.
Rooplal is pursuing all debtors and beneficiaries of the VBS collapse, "but we are not in a position to reveal who yet", he said.
"Where clients are in default on their loan repayments and loan obligations, we are following due process to collect all nonperforming loans."
Those already facing legal action include VBS treasurer Phophi Mukhodobwane, who borrowed R30.5m; Vele Investments CEO Robert Madzonga, who borrowed R30.3m; VBS CEO Andile Ramavhunga, who borrowed R28.9m; VBS CFO Philip Truter, who borrowed R5m; and Brian Shivambu and his company Sgameka, which owes the liquidated bank R4.2m. Shivambu is the brother of Floyd Shivambu of the EFF.
At least part of VBS's largesse was made possible by illegal deposits made by municipalities to the tune of R1.5bn.
A 148-page forensic report released last year by advocate Terry Motau, who was mandated to investigate by the Reserve Bank, found that 53 people and companies had over the course of about three years received a total of R1.9bn from VBS.
VBS co-liquidator Richard Pollock said he had liquidated Madzonga, Mukhodobwane and Ramavhunga in their personal capacities. "We are in a process of attaching all their properties," he said.
But the bank's biggest debtor is Leratadima Marketing Solutions, which owes R154m. The loan was to finance a contract with the Universal Services & Access Agency of SA (Usaasa) for 500,000 digital terrestrial television (DTT) set-top boxes.
The agency had received R2.3bn from the department of communications to provide 1.5-million set-top boxes, 1-million antennas and 500,000 satellite dishes. However, the project was a flop, with then communications minister Nomvula Mokonyane announcing in October last year that the government would no longer be procuring set-top boxes for its broadcasting digital migration project. However, Usaasa said it would continue to roll out remaining stocks of DTT set-top boxes.
Leratadima has so far been paid R239m by Usaasa for delivering 346,828 set-top boxes. However, Pollock said the company had not repaid the VBS loan and he had sought its liquidation.
This was finalised on December 11 2018.
Pollock said liquidators had held a meeting last month with Leratadima's 21 creditors. "Claims 1 to 17 were rejected by the Master of the High Court and only four were approved. However, most of these rejected claims are from employees. They are challenging the rejection through their lawyers."
He said liquidators were still investigating a number of issues regarding Leratadima, including its assets and bank accounts.
"They still owe Usaasa more than 100,000 DTT set-top boxes that they haven't delivered. We have held meetings with Usaasa and two of the other set-top box manufacturers. These 100,000 are still in the manufacturing stage and will only be distributed in some three months' time.
"Money from those will be paid into the liquidator's accounts and will be distributed among approved creditors," Pollock said.
"We are in contact with manufacturers and they are fully aware of the liquidation."
Usaasa CEO Lumko Mtimde confirmed that Leratadima had been contracted by the state entity.
"Usaasa was not cited as a party in the liquidation of Leratadima. Therefore, I can only confirm that Leratadima was contracted to produce 500,000 DTT set-top boxes. I can also confirm that we did receive the court order placing Leratadima in liquidation."
Mtimde said Usaasa had also awarded two contracts to BUA Africa and CZ Electronics Manufacturing. He said BUA Africa had delivered 43,708 set-top boxes and had been paid more than R26.9m, while CZ had delivered all the 500,000 boxes for which it was contracted.
Leratadima directors Mabuyi Memela and Itumeleng Mafoko did not respond to questions from the Sunday Times.

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