VBS Mutual Bank
VBS Mutual Bank — originally the Venda Building Society, founded in 1982 as a savings institution for rural black South Africans excluded from mainstream banking under apartheid — was systematically looted of R1.894 billion by 53 individuals between March 2015 and June 2018. The bank converted to a mutual bank in 1992 and by 2016 had approximately 30,000 depositors, primarily in Limpopo, serving burial societies, stokvels, and rural savers. It was placed under curatorship in March 2018 and the full scale of the fraud was exposed by the Treasury-commissioned “Great Bank Heist” report (Advocate Terry Motau, October 2018), which named Matodzi as the “directing brain” of what was effectively a single criminal enterprise run through VBS and its holding company Vele Investments.
The looting operated through two pillars. The first was internal: Tshifhiwa Matodzi orchestrated the fabrication of large fictitious deposits in favour of Vele Investments to present Vele as VBS’s dominant shareholder, propping up the balance sheet while real depositor funds were simultaneously transferred to Matodzi, executives, and connected political figures. Phophi Mukhodobwane (VBS Treasury General Manager) admitted receiving “vast sums” in exchange for his complicity. Sipho Malaba of KPMG, as external auditor, enabled the fraud to pass scrutiny — IRBA found him guilty of 8 charges in 2026 and sought a R1.6m financial penalty. The second pillar involved Danny Msiza (ANC Limpopo treasurer-general) and Kabelo Matsepe (ANCYL Limpopo leader) soliciting R3.4 billion in illegal municipal deposits. The Municipal Finance Management Act explicitly prohibited municipalities from depositing funds in mutual banks; Msiza used his political influence to coerce municipal officials and mayors, with “commission” bribes flowing to the facilitators. When VBS collapsed, municipalities lost R1.57 billion — the government declined any bailout, devastating Limpopo public services.
The EFF connection was exposed in detail by the Scorpio investigative unit (Daily Maverick, September 2019) and confirmed by Matodzi’s 253-page affidavit (filed July 2024 as part of his Section 105A plea deal, leaked the day after he began his 15-year sentence). In early 2017, when the EFF was publicly criticising VBS but paradoxically defending it as “victimised” — because VBS had given Jacob Zuma an R8 million home loan — Matodzi arranged a meeting at “the EFF’s penthouse in Sandton.” He met Julius Malema, Floyd Shivambu, and Marshall Dlamini and proposed: R5 million immediately plus R1 million per month if the EFF opened a VBS account and ceased public attacks. The parties agreed funds would flow via Brian Shivambu’s Sgameka Projects. R16.1 million total was channelled through Sgameka to cover upgrades to Malema’s Sandton home, a restaurant in Soweto, a house for Floyd Shivambu’s parents, school fees for Malema’s son, and designer clothing (Gucci, Louis Vuitton, tailored suits totalling R148,827 in a single payment). SARS traced R3.6 million in VBS loot directly into Floyd Shivambu’s FNB Private Wealth account across 23 payments. The Parliamentary Ethics Committee (October 2023) found Floyd Shivambu received R180,000 via Sgameka — a finding disputed by Daily Maverick and amaBhungane as inappropriately narrow. As of April 2026, no criminal charges have been filed against Malema or Floyd Shivambu.
Prosecution progress has been slow but incremental. As of February 2025: 35 arrests, 6 convictions, 29 on trial, 43+ under investigation, and approximately R700 million in assets recovered (25.6% of losses). Key convictions include Philip Truter (CFO, 2020, first conviction), Tshifhiwa Matodzi (July 2024, 33 counts, 15 years; now state witness), Hlengani Maluleke (Thulamela municipal manager, October 2023, 5-year suspended), and Johannes Mohlala (Fetakgomo-Tubatse municipal manager, November 2024, 5-year suspended). The Danny Msiza and Kabelo Matsepe trial was separated from 11 co-accused by a High Court ruling (August 2024); the NPA appealed to the SCA and the case was postponed to February 2026. SARS initiated liquidation of Brian Shivambu’s companies and demanded R28.2 million in taxes and penalties from him.
Connections
- Tshifhiwa Matodzi — chairman; “directing brain”; R326m extracted; 15-year sentence July 2024; now state witness
- Vele Investments — Matodzi holding company; central vehicle for internal looting and fictitious deposits
- Julius Malema — EFF president; Matodzi affidavit: agreed to R5m + R1m/month via Sgameka; specific expenditures traced by Scorpio
- Floyd Shivambu — EFF deputy president (left EFF 2024 for MK Party); R3.6m traced to FNB Private Wealth account; R180,000 found by Parliamentary Ethics Committee
- Brian Shivambu — Floyd’s brother; Sgameka Projects + Grand Azania; R16.148m received; SARS demanding R28.2m
- Danny Msiza — ANC Limpopo treasurer-general; “kingpin” of municipal deposit scheme; on trial (postponed to Feb 2026)
- Kabelo Matsepe — ANCYL Limpopo; R35m extracted; municipal fixer; on trial with Msiza
- Robert Madzonga — Vele CEO; R39m extracted
- King Toni Mphephu Ramabulana — Venda royal; Dyambeu figurehead; R18m extracted
- Phophi Mukhodobwane — VBS Treasury GM; admitted complicity; received “vast sums”
- Sipho Malaba — KPMG auditor; enabled fraud; found guilty of 8 charges by IRBA 2026
- Jacob Zuma — VBS gave Zuma R8m home loan; this became EFF’s stated reason for defending VBS
- National Prosecuting Authority (NPA) — 35 arrests, 6 convictions as of Feb 2025; Msiza/Matsepe trial stalled
- Zondo Commission — VBS looting referenced in State Capture inquiry