Legal Articles and Guides

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).

The longer it takes to conclude litigation against Steinhoff by shareholders, the less chance there is that shareholders will be able to recover any losses. A Fin24 report says this is according to attorney Alexander Reus of international law firm DRRT. Reus and other representatives of the International Steinhoff Litigation Group briefed Steinhoff investors on the progress of the SA opt-out class action, which was filed in the Gauteng High Court (Johannesburg) in August 2018.

The North West’s provincial Scopa will lay criminal charges against municipal officials who invested millions with VBS Mutual Bank if their municipalities fail to act against them. Yesterday, North West Scopa chairperson Mahlakeng Mahlakeng issued the warning after it emerged that some municipal officials implicated in the ‘Great Bank Heist’ scandal were still occupying positions in municipalities.

The DA says it will approach the courts if necessary to ensure the government is transparent with the public about the terms and conditions of loans Eskom received from China, according to a TimesLIVE report. DA leader Mmusi Maimane said 30 days had passed since he had submitted a request to Eskom in terms of the Promotion of Access to Information Act (Paia) to obtain the full terms and conditions of the R33bn loan agreement the power utility recently signed with the China Development Bank (CDB).

The first municipality to lose millions in the VBS Mutual Bank scandal has launched an application to liquidate the bank, Beeld reports. The Mahikeng Local Municipality in North West has applied to the Limpopo High Court for the liquidation. Acting municipal manager Jacob Molamu says in court papers that a business rescue of the bank is simply not an option.

Steinhoff International Holdings NV’s former CEO Markus Jooste advised friends to sell the retailer’s shares days before the stock collapsed, according to a mobile phone text message reportedly seen by Bloomberg. The message, sent on or about 30 November 2017 to at least two people, told recipients there was unspecified bad news coming, notes the Bloomberg report in Business Day.

Hackers using state-of-the-art technology stole and defrauded South Africans out of R250m in a single year, according to the SA Banking Risk Information Centre (Sabric) when releasing the latest digital banking crime statistics yesterday. It revealed that in 2017 cyber-criminals were involved in 13 438 online‚ mobile and Internet banking attacks, and the total sum siphoned off in all digital banking-related crimes during that year was R250m.

The Legal Resources Centre (LRC) has welcomed a High Court decision that Magistrate's Courts should be the first port of call for financial institutions seeking judgment against their clients, where matters fall within the lower courts' monetary jurisdiction. According to a GroundUp report, the LRC argued that 'measures must be taken to reduce the economic, social and geographical barriers that prevent a respondent's access to court' as required under the Constitution.

SA investors, including Allan Gray, Investec’s asset management arm and Old Mutual, are backing litigation against crisis-hit Steinhoff in the Netherlands, they said on Friday. The investors represented about 20% of the shareholding in Steinhoff when the retailer uncovered accounting irregularities in 2017 that sent its share price tumbling, a statement from representatives of the investors said, according to BusinessLIVE.