South Africa’s biggest bank heist took place without a single shot being fired.
Thieves armed with explosives and assault rifles attacked dozens of armored vehicles delivering cash to the country’s lenders last year, stealing hundreds of millions of rand. They’ve allegedly been outdone by five bankers accused of siphoning off at least 1.5 billion rand (S$154.7 million) from VBS Mutual Bank.
The collapse of the seventh-smallest of South Africa’s 21 banks has left a trail of destruction, with customers queuing up outside branches before dawn in the hope of accessing their funds. Like Mulalo Ramano, a 72-year-old widow who’s suffered anxiety attacks fretting about the 20,000-rand life savings she deposited at the bank.
“My heart beats so so fast, it feels like it’s going to pop out,” a frail Ramano said July 14 as she waited outside a branch of VBS in Thohoyandou in northeastern South Africa. She was among dozens of people lined up to trying to get their money back from the lender that collapsed in March.
The scandal has claimed the jobs of senior managers at KPMG South Africa and the Public Investment Corp., Africa’s largest money manager. It’s also put at risk 1.65 billion rand of illegal deposits made by 13 already cash-strapped municipalities, which the government has said won’t be bailed out.
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The scale of the fraud is more than three times the size of the 10 biggest cash-in-transit heists pulled off by armed attackers last year, when they netted 456 million rand, according to Interpol data published by the Johannesburg-based TimesLive news website.
“It probably is the biggest bank heist in South Africa by bankers,” said Kuben Naidoo, the registrar of banks and a deputy governor of the central bank, who described VBS as a Ponzi scheme. “It certainly is one of the biggest banks frauds that we’ve seen in South Africa.”
Nedbank Group Ltd, South Africa’s fourth-biggest bank, with support from the central bank, has stepped in to help with payouts for VBS customers.
VBS’s history stretches back to 1982, when racist laws were in full force and black South Africans had little or no access to finance. Burial societies established the Venda Building Society to offer impoverished communities a way to set aside money for funerals.
The bank shot to prominence in 2016, when it loaned former President Jacob Zuma almost 8 million rand to reimburse taxpayer money spent on upgrades to his private home. At the time, Zuma was facing accusations of allowing his friends the Gupta family to influence cabinet appointments and unfairly win state contracts. Zuma and the Guptas deny any wrongdoing.
