Justice Minister Thembi Simelane. Picture: X/@NonqabaMosunku9
President Cyril Ramaphosa has summoned Justice Minister Thembi Simelane to provide a detailed report on allegations that link her to the Venda Building Society (VBS) Mutual Bank scandal.
Simelane allegedly took a R575 600 “commercial loan” from Gundo Wealth Solutions, owned by Ralliom Razwinane, and brokered unlawful investments of R349 million into the now defunct VBS Mutual Bank by the Polokwane Municipality while she was mayor of the city in 2016.
Razwinane is facing charges for allegedly acting as an agent to secure business for VBS from municipalities.
Ramaphosa’s spokesperson Vincent Magwenya said the president is concerned about the media reports containing allegations of corruption against Simelane.
“The media reports have linked the minister with monies alleged to have been received improperly from the VBS Mutual Bank during her tenure as mayor of the Polokwane Municipality. The president has requested a detailed report and briefing from the minister on the matter.”
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Civil society organisations have added their voice to calls for Simelane to urgently clarify corruption allegations that linked her to the VBS scandal.
Freedom Under Law (FUL), Ahmed Kathrada Foundation, Judges Matter and Defend Our Democracy have expressed concerns about the explosive revelation that Simelane was connected to unlawful investments in VBS Mutual Bank.
When VBS imploded in March 2018, forensic investigations found it had rewarded Razwinane with kickbacks totalling R24.2 million for being a commissioning agent for various municipalities and state entities.
Investigators found these to be corrupt transactions and contraventions of the Municipal Finance Management Act.
Razwinane is currently on trial for fraud, corruption and money laundering for his role as a commission agent connecting municipalities, including Polokwane Municipality, with VBS.
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Simelane used the “loan” to buy a coffee shop in two transactions in October 2016. The payments appear linked to kickbacks received in exchange for large deposits by Polokwane Municipality into VBS.
In October 2016, VBS paid R1.66 million in kickbacks to Razwinane and Gundo Wealth Solutions in exchange for two deposits totalling R130 million from the Polokwane Municipality. They were made shortly after Gundo signed a three-year contract to provide investment brokerage services to the municipality.
In turn, Razwinane paid R575,600, almost 35% of his kickbacks, to a company called Ricovert, the then-owner of Silvanas Coffee Shop on the ground floor of Fredman Towers in Sandton.
The Citizen visited the Fredman Towers office building in Sandton to verify whether Simelane’s coffee shop, called Silvana’s was still operating, but was told the shop had been vacant since last year and only occupied in February this year, when a new tenant moved in.
ALSO READ: Pressure mounts on Thembi Simelane to account for dodgy VBS ‘loan’
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