Three former senior West Rand District Municipality officials are this morning expected to appear before the Pretoria Specialised Commercial Crimes Court for allegedly illegally making deposits to the now defunct VBS Mutual Bank.
The suspects are a 60 year-old West Rand district municipal manager, the council’s 37 year-old former chief financial officer and Merafong municipality’s 34 year-old acting municipal manager, who was income and expenditure manager in the West Rand when the transactions occurred.
The suspects were on Monday arrested by the Hawks’ Serious Corruption Investigation at several locations in Gauteng.
In a statement, the Hawks said the arrests were based on the ongoing investigation of maladministration and corruption in the looting of the VBS Mutual Bank.
“The allegations … relate to investments into VBS Mutual Bank made by municipalities. The investments made by the municipalities into VBS are reported to have been done in contravention of the provisions of the Municipal Finance Management Act by investing municipal funds with a mutual bank,” said Colonel Katlego Mogale, Hawks spokesperson.
During the arrests, a search and seizure operation was also conducted in order to confiscate IT equipment which could contain pertinent documentation and/or articles relating to the investigation.
National Hawks Head Lt Gen Godfrey Lebeya has previously indicated that following the arrests and securing of court attendance of the main players in the VBS investigation, arrests within municipalities will follow.
A total number of 20 municipalities deposited an amount of R3.7 billion – the amount repaid totals R2.2 billion while the amount lost/unpaid amounts to R1.5 billion.
Some of the lost funds amounting to R67 million were allegedly paid as brokerage commissions to entities and/or individuals to attract more deposits mainly from municipalities.
A nationwide investigation has revealed that VBS employees, municipal executives and other officials allegedly received gratifications for the investments made.
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