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Banking & Finance Law
Banking & Finance
A forensic investigation has revealed about R80m said to have been illegally invested in VBS Mutual Bank by rogue officials at the state-owned Community Schemes Ombud Service (CSOS) was actually deposited into an FNB corporate cheque account belonging to the now-insolvent bank, says a Mail & Guardian report.
The KZN High Court (Pietermaritzburg) has found the Reserve Bank’s intervention into the affairs of Sharemax Investments was the cause of the R5m loss by an investor in one of the company’s schemes and not any breach by an investor's financial adviser.
Borrowers with more than one debt outstanding were given some protection last week when the SCA ruled that the interest rate on short-term loans after the first loan cannot exceed 3% a month. GroundUp reports Micro Finance SA (MFSA) had challenged regulations promulgated under the National Credit Act reducing the interest rate on a second short-term loan taken out in a 12-month period from 5% to 3% a month.
The Equality Court is to hear a case alleging discrimination by a bank – the first time such a case has come before this court. Cape Town-based usury expert Emerald van Zyl has taken his nearly 10-year fight against alleged banking abuse to the Cape Equality Court, seeking a ruling that FNB’s FirstRand Finance Company discriminated against more than 4 000 black customers by charging them 30-40% more than white customers on their mortgage loans.
The JSE censured Pepkor and fined it R5m yesterday for failing to tell its shareholders that it stood surety for R15bn of Steinhoff International’s debt, and about its loans to senior management. Pepkor issued a separate statement saying it ‘has acknowledged that inadequate disclosures were made during the process of its listing and the publication of its annual financial statements in 2017’, notes a BusinessLIVE report.
The battle by companies to profit from social grants rages on with another round of court action, this time between Sassa and another Net1 subsidiary, which will be heard today. According to a Mail & Guardian Online report, the Net 1 subsidiary, Moneyline Financial Services, is asking the Gauteng High Court (Pretoria) to compel Sassa to accept the consent forms – confirming bank accounts into which the social grants should be paid – of beneficiaries through Cash Paymaster Services (CPS).
African Bank’s BEE shareholders have applied for leave to appeal against the recent dismissal by the Gauteng High Court (Pretoria) of its legal action against former CEO Leon Kirkinis, his fellow board members and Deloitte. A Business Day report says the case could set legal history by enabling shareholders to sue directors and auditors.
The liquidation of VBS Mutual Bank will allow criminal and civil proceedings against those responsible for its demise to pick up pace, and will allow for the recovery of money from those who looted or owed the bank, says a Business Day report. The Gauteng High Court (Pretoria) yesterday granted an order for the liquidation of VBS after an application by the SA Reserve Bank's Prudential Authority was unopposed by respondents, which includes the bank and the Minister of Finance.
A former senior executive of the scandal-ridden VBS Mutual Bank has revealed that a branch manager was ordered to make a R3m payment to fund the SACP’s annual congress last year, allegedly in exchange for the party’s silence on the bank’s relationship with the controversial Gupta family, claims a City Press report.
The SA Reserve Bank's Prudential Authority has disciplined HSBC Bank Johannesburg for weaknesses in its processes that prevent the bank from ‘proactively detecting potential money laundering and the financing of terrorism’. The bank has been fined R15m and ordered to take remedial action, the Reserve Bank said.
Alleged Ponzi scheme mastermind Goodman Goqo – accused of defrauding more than 4 000 people out of R76m – pleaded not guilty to all 16 452 charges against him yesterday, says a News24 report. ‘We are making no admissions. The state must prove its case,’ his attorney Nosizwe Bantwana told Durban Regional Court Magistrate Simphiwe Hlophe.
The ANC has admitted it received R2m from the large-scale looting at VBS Mutual Bank. Treasurer-general Paul Mashatile admitted on eNCA yesterday that, as the Sunday Times reported at the weekend, the party received a R2m donation from the bank's majority shareholder, Vele Investments. Mashatile said the investment company paid R2m to a service provider on behalf of the ANC ahead of the 2016 local government elections, but that he did not know what it was for, notes a News24 report.
An amaBhungane and Financial Mail investigation has confirmed what many have long suspected: former Steinhoff CEO Markus Jooste (57) held secret stakes in companies that traded with Steinhoff for years to Jooste’s covert benefit. These deals’ true beneficiaries were hidden from investors, says a Financial Mail report.
Eastern Cape businessman Selwyn Moonieya is suing FNB for R3.6m for negligence and loss. A Daily Dispatch report says Moonieya has accused FNB of being negligent in opening up a business bank account for an ex-employee under Moonieya’s company’s name, Silverton Solutions.
The Prudential Authority (PA), formerly known as the Registrar of Banks, has filed court papers seeking the liquidation of VBS Mutual Bank. In a press statement issued yesterday, the PA confirmed it had filed the application with the Gauteng High Court (Pretoria).