VBS put ‘fake money’ into its accounts – and drew it to bribe officials and buy businesses: report

New affidavits in the VBS case allege that the bank’s directors manually entered fake deposits into its systems, drawing the non-existent money to bribe officials and allow its directors to buy companies.

This is according to a new report in the City Press, which revealed in June that the bank was looted for over R1.5 billion by its own management, to buy luxury goods and new cars.

In the latest report, affidavits from former senior employees claim to reveal the extent of the fraud at the bank.

They allege that directors would manually enter in fake deposits from a ‘suspense account’ or a made up source – this would then reflect on the bank’s systems. Real money could then be withdrawn, with the funds covered by the real depositors – individuals, funeral groups and municipalities.

According to the City Press this allowed the directors to loot the R1.5 billion reported last month. It is also alleged that:

  • Money was withdrawn and paid to bribe the PIC to provide R350 million in backing
  • The directors used the ‘fake money’ to acquire majority stakes in VBS
  • The money was used to acquire other companies
  • Bonuses and other payments were made from this made-up cash pool; and
  • The money was used to settle massive overdrafts.

The PIC said it is not aware of any bribe as mentioned by the report, but if further information surfaces about the alleged event, it will handle it with the necessary authorities and measures.

You can read the full report in the City Press for 8 July

Read: VBS Bank was looted by some of its own executives – and a king: report

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