Prosecute municipal officials in VBS fraud
Parliament has decried the lack of clear and substantial action against senior municipal officials who oversaw the illegal investment of municipal funds in the now defunct VBS Mutual Bank.
TimesLIVE reports the National Assembly's Portfolio Committee on Co-operative Governance said the lack of consequence management for local government would be the death knell for the transgressing municipalities. It added that without concomitant action, municipalities would continue to struggle to deliver quality services – which ultimately hurts residents.
The committee said the municipalities that invested monies in VBS were now technically insolvent.
‘This affects their financial viability and the ability of municipalities to service their creditors. This is likely to continue in the foreseeable future and has a direct impact on the ability of municipalities to deliver quality service delivery to the people,’ said committee chair Faith Muthambi.
‘It is concerning that some municipalities have even paid out municipal managers and chief financial officers who had been identified to have been central in investing the money of the municipalities into VBS. There is clear lack of appetite for consequence management, which undermines prescripts of good governance,’ said Muthambi.
‘It is obvious that various municipal managers and CFOs committed financial misconduct. It is in this context that the committee is perplexed that despite suspensions of various municipal managers and CFOs, no further action has been taken,’ she said.
The committee has called for speedy civil claims to be instituted, especially against the municipal managers and chief financial officers who resigned from these municipalities.
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