Soviet Lekganyane. Picture: ELIJAR MUSHIANA
Soviet Lekganyane. Picture: ELIJAR MUSHIANA

In the biggest political action taken so far after VBS Mutual Bank was driven into the ground by a R2bn fraud that implicated some members of the governing party, the ANC in Limpopo
has asked seven mayors in the province to resign.

The most notable was Vhembe District Municipality mayor Florence Radzilani, who resigned on Tuesday. Radzilani is also the party’s deputy chair in the province. Party treasurer Danny Msiza was also implicated in the VBS saga.

The other six mayors are expected to resign.

The alleged role of political players in the collapse of VBS, which was set up in 1982 in the former Venda homeland, was laid bare in a forensic report compiled by advocate Terry Motau and Werksmans Attorneys in October.

The report also found that a company owned by the brother of EFF deputy leader Floyd Shivambu received R16m in payments associated with the bank. Shivambu has denied all wrongdoing.

A huge part of the fraud included municipalities in some of the poorest areas of the country depositing money with VBS, in contravention of regulations that prevented them from putting money into mutual banks. It was alleged that municipal officials were paid bribes to facilitate the deposits.

In the report, Radzilani was said to have asked for a "Christmas" present — colloquial speak for a bribe — for keeping the municipality’s deposit with VBS.

She has previously denied any knowledge of the local authority’s dealings with VBS, which burst into prominence
in 2016 after it lent almost R8m to former president Jacob Zuma.

The ANC’s integrity commission resolved more than a month ago that leaders implicated in the scandal should step down, but that has been deferred on multiple occasions.

The move to axe mayors embroiled in the scandal is largely seen as part of the party’s attempt to clean up its ranks ahead of the 2019 national elections. The ANC North West provincial task team has also given seven of its mayors marching orders.

Limpopo ANC provincial secretary Soviet Lekganyane said on Tuesday the resolution that the seven mayors should resign was only the first phase of action the party planned to take.

The second phase would involve looking at other officials whose actions had led to the municipalities losing money.

He said the ANC in the province found "very serious weaknesses" in its deployment strategy and this should be discussed at national level.

ANC councillors should have picked up on the unlawful and irregular deposits made to VBS, he said.

Lekganyane said the ANC could not instruct that municipal managers or chief financial officers be removed, but did have the authority to do so with its own deployees, such as
the mayors.

"It’s now over a year that monies have been lost," Lekganyane said. "We have seen elderly people coming out and complaining that they have lost all their investments, and what is the ANC saying?

"Is the ANC so deaf, is the ANC so blind that you cannot even hear the cries of the poorest people in society who had VBS as their only hope?" Lekganyane said.