If the question is how we keep people in positions of authority honest, one thing the VBS scandal proves is that regulation is not the answer. As Stuart Theobald wrote in Business Day recently, when it comes to banks it’s all belts and braces. Indeed, these are so all-encompassing it’s surprising there’s any scope to do business, let alone dodgy business. In addition to all manner of regulations and laws governing their every move, the Reserve Bank keeps a beady eye on banks — including the granting of approval for all director appointments. Legend has it that this is why Steinhoff’s Markus Jooste was never appointed to the Investec board; presumably some wily character at the Bank was not as trusting of Jooste as Christo Wiese was. In addition to all the regulations and the Bank’s near-oppressive oversight, VBS was required — as all banks are — to have two audit firms. PwC was the internal auditor while KPMG did the external audit work. Whatever PwC was paid for this role it now lo...

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