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Trio in court for R153 million VBS corruption matter

The former Municipal Manger and acting Chief Financial Officer of the Greater Giyani Local Municipality, together with a businessman, have appeared in court in connection with a VBS corruption matter in which the municipality suffered a loss of at least R153 million.

Former Municipal Manager Risimati Maluleke, the municipality’s Acting Chief Financial officer Nditshedzeni Mashau and businessman, Zwivhuya Goodness Tshishonga, appeared in the Polokwane Specialised Commercial Crimes Court.

The trio face charges of contravening the Municipal Finance Management Act (MFMA), corruption and money laundering.

According to the National Prosecuting Authority regional spokesperson, Mashudu Malabi-Dzhangi, the three are in the dock for their alleged role in “approving an unlawful investment to VBS Mutual Bank since VBS was not a bank as defined in the banks act” – costing the municipality a loss exceeding R153 million.

“It is alleged that the first investment of R100 million matured and yielded an interest amounting to over R4 million. Later, over R48 million was also invested. The investment and the interest were then not paid back to the municipality.

“The investigations revealed that the municipality had illegally invested over R153 million into VBS for 18 months. Furthermore, the Acting Chief Financial Officer (CFO) recommend that the money should be invested with VBS, instead of using authorised banks,” the NPA said in a statement Thursday.

Malabi-Dzhangi added that the accused allegedly acted in a “a grossly negligent way in contravention of MFMA” and “did not take reasonable steps to ensure that the resources of the municipality were used effectively, efficiently, and economically”.

“It is alleged that Tshishonga received substantial amounts of money into his business account of Real Consulting, in turn, Tshishonga [would] transfer a portion of the money to Maluleke thus disguising the nexus between VBS and Maluleke. In total Maluleke received R62 000 from Tshishonga,” she said.

The three are expected back in court in August. – SAnews.gov.za

SANews.gov.za

The post Trio in court for R153 million VBS corruption matter first appeared on South Africa Today.

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