VBS Mutual Bank customers wait outside the bank in Thohoyandou, Limpopo to demand their money back in this October 17 2018 fie photo, Picture: SOWETAN/ANTONIO MUCHAVE
VBS Mutual Bank customers wait outside the bank in Thohoyandou, Limpopo to demand their money back in this October 17 2018 fie photo, Picture: SOWETAN/ANTONIO MUCHAVE

The funeral industry has been left to pick up the pieces in the wake of the VBS Mutual Bank cash scandal.

Funeral Industry Reformed Association (Fira) spokesperson Johan Rousseau said on Friday that VBS had failed to pay out funeral insurance and policy claims‚ leaving members of the public and the industry frustrated.

It was one of a number of sections affected by the VBS saga.

"What happened is that some of these funeral parlours had policies that were underwritten by VBS. These funeral parlours were acting as brokers between the public and VBS‚" said Rousseau.

Because Fira is not an ombud or regulator‚ there was hardly any assistance it could provide‚ he said. "The only thing we are trying to do is go to the FSB (Financial Services Board)‚" Rousseau said.

He warned people to be wary of the companies they had dealings with‚ saying that for now‚ they had no direction on whether they could recoup any of the funds put into VBS.

Earlier this week‚ TimesLIVE reported that the government had resolved not to bail out poor and rural municipalities that were also embroiled in the scandal.

It was reported that these municipalities illegally invested more than R1.57bn in the now cash-strapped bank. Several municipalities in Gauteng‚ Limpopo and North West invested money with VBS in contravention of the Municipal Finance Management Act.

VBS was placed under curatorship by the SA Reserve Bank in March when it went bankrupt, after alleged looting by executives led to a liquidity crisis.

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