Former municipal manager sentenced in R230m VBS Bank scandal

A former Fetakgomo-Tubatse Local Municipality manager who invested R230m into VBS Mutual Bank, has been given a five-year suspended sentence after his guilty plea.

Johannes Mohlala (60) appeared in the Pretoria High Court on Thursday where the sentence was handed down.

Sentence

Mohlala was also ordered to pay an amount of R100, 000 to the curator of VBS.

Hawks spokesperson Col Katlego Mogale said Mohlala was convicted and sentenced on the same day after he pleaded guilty to a section of the Municipal Finance Management Act (MFMA).

“The investigation revealed that Fetakgomo-Tubatse Local Municipality invested an amount of R230 million which was paid in five trenches from 15 November 2016 to 19 February 2018.”

Mohlala and his co-accused former CFO of the municipality, Tumelo Ratau and businessman Keaobaka Kgatitsoe, were arrested in November 2021 at their homes in Pretoria on allegations of contravention of the MFMA for investing municipal funds with VBS.

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Warrant of arrest

“Accused 2, Mr Ratau (42) did not attend court and a warrant for his arrest has been issued. The case was remanded to 18 November 2024 for forfeiture of bail of Mr Ratau.

“The third accused, Keaobaka Remigious Kgatitsoe was sentenced to five years imprisonment which was wholly suspended for five years when he appeared in the Pretoria Specialised Commercial Crime Court on 12 July 2022, on the Fetakgomo Tubatse Local Municipality case relating to VBS investments,” Mogale said.

“The three appeared in the Pretoria Specialised Commercial Crimes Court on Wednesday, the 17 November 2021 on charges of Contravention of section 173 of the Municipal Finance Management Act, 2003 (Act No. 56 of 2003); corruption; and money laundering,” Mogale said.

Dondo Mogajane

Earlier this week, Dondo Mogajane, the former director general of the National Treasury and current chair of the Government Employees Pension Fund announced that he is stepping down from all professional roles and boards in the wake of allegations that he took a bribe while he was director general.

Finance Minister Enoch Godongwana also told journalists last week before he delivered the Mid-Term Budget Policy Statement (MTBPS) that he would “deal with” the reputational risk of Mogajane.

Former chairperson of VBS Tshifhiwa Matodzi testified in the Gauteng High Court in Pretoria that Mogajane took a R1 million bribe.

He claimed in his affidavit as part of his plea deal that Mogajane accepted the bribe for withdrawing a letter from Treasury instructing municipalities to stop depositing funds with the bank.

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