AFFIDAVIT

I, the undersigned

TSHIFHIWA MATODZI

do hereby make an oath and state as follows:

1.

I am an unemployed adult male of 46 years with a South African identity number 770718 5406 082. I am the former chairperson of the VBS Mutual Bank ("VBS") and Executive chairperson of Vele Investments.

2.

The facts herein deposed to by me are true and correct and are within my own personal knowledge and belief, save where otherwise stated or the contrary appears from the context.

3.

I hereby declare that I make this statement voluntarily and out of my own free will. I have not been coerced, threatened and/or promised anything in exchange for making this statement. I understand the nature of the charges against me, including corruption, fraud, theft, money laundering and contravention of the pattern of racketeering activities. I take full responsibility for my actions. I am cooperating with the police and prosecution in the hope to rectify my wrongdoings and seeking appropriate consequences for my actions.

4.

PART A - BACKGROUND AND HISTORY (4-9) INTRODUCTION

Foremost, I wish to record and offer my sincere and unconditional apologies to all the victims of my actions which include depositors, shareholders, stakeholders, suppliers, staff and members of the public and South African taxpayers at large.

As will appear from the facts set out hereinunder, I was entrusted to play an important role in overall oversight in my capacity as Chairman of VBS. I admit that I totally failed in my responsibility in this regard.

5.

PERSONAL BACKGROUND

5.1 I grew up in Thohoyandou which is situated in the Limpopo Province. VBS, then known as Venda Building Society ("VBS") had a branch in Thohoyandou. My parents had a small General trading store which was situated near VBS. At the time I was still in high school. During weekends and after school, I would assist my parents in their business by selling, amongst other things, paper bags. With the passage of time, I made some profits out of selling paper bags. This led to my parents opening a bank account for me at VBS so I could deposit my share of profits.

5.2 After 1995 I moved to Johannesburg to study my BCom Accounting degree at Randse Afrikaanse Universiteit ("RAU"). Every time I went back to Venda during term holidays, I would notice that the previously long queues at VBS were growing smaller. To me this was evidence of VBS deterioration. This observation stirred in me a keen interest as to how best to restore VBS to what one may call its former glory.

Given my commerce studies and history of entrepreneurship, I started discussing my concerns with my fellow commerce students at RAU especially those who knew VBS and its history just like me. Down the line I obtained my BCom Honours in Accounting degree and later qualified as a Chartered Accountant ("CA"). I thereafter worked for various auditing firms and later ventured into corporate and business outside banking environment.

6.

2012 VBS SHARE SUBSCRIPTION ADVERTISEMENT:

6.1 Sometime in 2012, I received a call from my friend, Mr Chris Manwadu

("Chris0), whom I had met at RAU where he was also studying commerce there at. Chris happened to have been part of those university conversations about VBS. In that telephonic conversation Chris informed me that VBS had advertised for share subscription in a Venda local newspaper. I immediately travelled to Venda and made enquiries about the share subscription which led

to my acquisition of 10, 000 shares for myself. I personally purchased these shares for R100, 000 using my own money. Chris further provided me with the

name of one Mr Ntendeni Sasa Nemabubuni ("Sasa0), being the person with

whom I could engage with since at the time he was the branch manager of the VBS Sibasa branch. In turn I met Sasa who later introduced me to two gentlemen namely Mr Otto Kwinda ("Otto") and Mr Solomon Maposa ("Solly"). At the relevant time Otto was a shareholder at VBS whereas Solly was an employee of VBS in the Credit and Collections Department. After meeting with all three of them, I then had a wholistic overview of the VBS, including its shortcomings impeding its growth and potential.

6.2 During the purchase of my initial shares in VBS, the Public Investment Corporation ("PIC") was already a shareholder of more than 80% shares at VBS. At that relevant time, I became aware that VBS had 600, 000 unissued shares valued at R6 million and still available for sale to the public. The ownership of the 600, 000 shares would have resulted in the person acquiring them becoming the second biggest shareholder of VBS.

7.

VBS SHAREHOLDERS FORUM:

7.1 Having become aware of the challenges confronting VBS's potential, and given my newly acquired status as a shareholder, I then sought to engage fellow shareholders for a way forward to address these challenges. My intention was to encourage the fellow shareholders not to be less passive in matters that had an impact on both the growth and success of VBS.

7.2 I knew that to address the challenges confronting VBS, I needed to garner the support of fellow VBS shareholders. This view or approach meant amongst other things the necessity to form a shareholders' forum to progress VBS and its interests.

7.3 Following the above, the shareholders forum constituted by over 150 members was formed in 2013. Of the initial members that formed part thereof I only remember three namely: Otto, Mr David Kholophe, Mr Mulaudzi (whose first names I can't remember).

8.

FORMATION OF DYAMBEU INVESTMENTS

8.1 In 2013 Dyambeu Investments (Pty) Ltd with Registration Number: 2013/003852/07 was duly registered and incorporated as a company in terms of the South African law ("Dyambeu"). Its directors at the time were the following: Paul Makhavhu and Ramaano Ramabulana, who represented the Vhavenda Heritage Trust ("VHT") which held 51% equity stake: David Mabilu who represented himself through Promafco which held 24,5% equity stake: Myself and Maanda Phalanndwa represented Brilliant Telecommunications holding 24,5% equity stake.

8.2 The sole purpose for which Dyambeu was formed was to acquire the above­ mentioned 600 000 unissued shares in VBS.

8.3 The process of formalising the purchase of the 600 000 shares by Dyambeu took approximately a year to complete. The reason was due to the following processes that needed to be completed:

8.3.1 The VBS board needed Dyambeu to present a structure that was acceptable to them.

8.3.2 The FICA regulations and accompanying documentation had to be completed and complied with.

8.3.3 Engagement and acceptance by the PIC.

8.3.4 Engagement with SARB.

8.4 Dyambeu fulfilled the conditions as set out by the VBS board for acquisition of the unissued shares. After all processes stated above were complied with the shares were then issued to Dyambeu on 13 February 2014. The actual amount that was paid was R5, 990, 620 for a total of 599 062 VBS shares. The total payments were effected by Brilliantel and Promafco's own funds.

8.5 I became the main shareholder representativeof Dyambeu on all administrative issues where VBS, PIC, SARB or any relevant stakeholders were involved. The PIC representatives at the time were Mr Ernest Nesane ("Nesane") and his alternate board member was Mr Paul Magula ("Magula").

9.

TURNAROUND STRATEGY AND THE ENGAGEMENT WITH THE PIC/SARB:

9.1 The first time I met with Nesane in person was at the VBS Annual General Meeting ("AGM") which was held on 26 July 2013 but postponed to 27 September 2013. On this date (27 September 2013) I met Magula for the first time and Nesane was also present.

9.2 During the course of Dyambeu application for shares in VBS, Nesane advised me that Dyambeu needed to draft and present a formal turnaround strategy to the PIC.

9.3 Various meetings were held with PIC regarding VBS strategy culminating in presentation of strategy to SARB by Dyambeu and PIC.

9.4 Once the turnaround strategy was finalised, Dyambeu and the PIC presented the strategy to the SARB. The SARB also recommended certain requirements to some points within the strategy. One example was the SARB requirement that the Fuel Finance Facility be subordinated. The newly appointed Chief Executive Officer ("CEO") designate, Mr Andile Ramavhunga ("Andile") was also involved in the strategy and made various inputs, including introduction of the Fuel Finance and Contract Finance Facility. After Dyambeu share approval by the VBS board and SARB approval the turnaround strategy was then handed over to the VBS CEO. The strategy then became the property and responsibility of VBS board through its CEO; see copy of the turnaround strategy attached herewith, marked and annexed as TM-1. The strategy was formally adopted by VBS board during the bank's strategic session in August 2014.

10. PART B - PERSONS OF INTEREST (10-13) GENERALLY CORRUPT RELATIONSHIPS:

10.1 The following will highlight the activities that myself, certain VBS bank officials and board members, municipal officials, political office bearers and other role players participated in which led to the collapse of VBS.

10.1.1 We engaged in a web of corrupt activities. The way we operated was unspoken yet well understood by those involved. This operation was designed to separate the main role players and their functions from other role players to keep the proverbial Chinese Wall between the participants, even though those involved knew their specific roles within the system. To my knowledge, the management and control of these activities was, in one way or another, performed by the following people being myself, Andile, Truter, Phophi and Solly. To my knowledge the other participants involvement was limited to their specific areas of expertise.

10.1.2 The general understanding amongst those involved was to perform actions in return for benefits and/or favours.

10.1.3 Our combined actions were characterised by deliberate and fraudulent financial maneuvers which resulted in significant financial losses to VBS, thereby undermining its financial integrity and in the process violating our fiduciary and ethical responsibilities.

10.1.4 Some of these transactions and favours were never documented. However, they followed a set of unwritten rules that each participant inherently recognised. We maintained a united front, skillfully avoiding overt conflict of interest, to a point that even some members of the VBS board would abstain from attending certain meetings where sensitive matters that could expose their involvement would be discussed.

10.1.5 This coordinated effort underscored our common purpose and reinforced the corruption that bound all of us together, thus ensuring our illicit activities remained concealed.

11.

PERSONS OF INTEREST

Around February 2014 I became a shareholder representative for Dyambeu and around July 2015 I was appointed the Chairman of the VBS board. The following persons were involved in one form or another in respect of the irregular activities that led to the collapse at VBS.

11.1 Andile Ramavhunga ("Andile") was the CEO of VBS. Andile was appointed as Acting CEO on 22 November 2013 and CEO of VBS in 2014. He reported to the board of VBS and was also an ex-officio member of the same board. I am the person who introduced Andile to VBS. He was an experienced banker and he joined VBS following my persuasion. As already stated above and to my knowledge, Andile was also involved in the following irregular activities in the following manner:

11.1.1 He launched some of financial and banking products outside the approved strategy and VBS board approval, for example, he approved loans for Leratadima ("Leratadima") digital decoder migration project, despite PIC having ring-fenced the facility for fuel transactions only.

 

11.1.2

He approved loans and facilities that exceeded his delegated authority. For example, he approved transactions for Leratadima R100 million and thus over his delegated authority.

11.1.3

He regularly issued irregular verbal instructions to his subordinates to conceal his involvement.

11.1.4

He regularly appointed people in senior positions without following proper HR processes.

11.1.5

He failed to report large exposures and fraudulent transactions to the board and the relevant financial authorities.

11.1.6

He was aware and at times also participated in the gratification scheme being paid to the VBS commission agents who in turn paid gratification to the municipal officials.

 

11.1.7

 

He knowingly participated in the approval of the falsified records and documents presented to him for the approval of funds released from the PIC Fuel Finance Facility.

11.1.8

He signed the Director's Responsibility Statement knowing fully that there were misstatements and unreported irregularities in the Financial Statements.

11.1.9

I am aware that Andile signed a letter to the PIC containing false financial information to PIC for the October 2017 rights issue.

11.1.10

Andile was linked to two companies namely, Dambale Holdings and Munyai Investments. Payments were made from the Vele bank accounts to Andile's two companies as mentioned above on his behalf. These payments were irregular and corrupt in nature as they were rewards for his participation in the broader VBS corruption scheme. Neither Andile nor his two companies rendered any services to Vele Investments that entitled them to any remuneration from Vele Investments.

11.2 At the relevant time Philip Truter ("Truter") was the Chief Financial Officer at VBS and reported to the CEO. He was both an ex-officio member of the VBS board and its company secretary. To my knowledge, Truter was involved in irregular activities in the following manner.:

11.2.1 He manipulated the DI returns which caused the SARB to have an incorrect view of VBS level of capitalization.

11.2.2 He actively participated in the creation of irregular deposits and manipulation of the VBS suspense account which caused financial loss to VBS.

11.2.3 He participated in forging records and customer documents to have funds released by the PIC from the Fuel Finance Facility.

11.2.4 He was aware of the gratification scheme being paid to the VBS

commission agents who in turn paid gratification to the municipal officials.

11.2.5 He enabled the breakdown of controls by manipulating the banking system and irregularly backdating transactions.

8

11.2.6

He Knowingly received irregular gratification for the manipulation of the VBS suspense accounts which caused financial loss to VBS.

11.2.7

He failed to report large exposures and fraudulent transactions to VBS board and the relevant authorities.

11.2.8

I am aware that Truter submitted false financial information to PIG for the October 2017 rights issue.

11.2.9

He Intentionally mislead the VBS auditors by falsifying the annual financial statements of VBS leading to incorrect reporting to the stakeholders.

11.2.10

He signed the Director's Responsibility Statement knowing fully that there were misstatements and unreported irregularities.

11.2.11

Truter was linked to a company called Shangri La. Payments were made from the Vele bank accounts to Truter and Shangri La on behalf of Truter. These payments were irregular and corrupt in nature as they were rewards for his participation in the broader VBS corruption scheme. Neither Truter nor Shangri La rendered any services to Vele Investments that entitled them to any remuneration from Vele Investments.

11.3 Phophi Mukhodobwane ("Phophi") was the Head of Treasury and Capital Management at VBS. Around 2016, Phophi was introduced to me by an employee of VBS, Mr Ndivhuwo Mafunzwaini. He was interviewed by Andile and Truter for the position of head of treasury. He was appointed around July 2016 to relieve the pressures on Truter and to stabilize the treasury and cash management function. To my knowledge, Phophi was involved in irregular activities in the following manner:

11.3.1 He participated in the clearing of Vele and its related parties' overdrafts.

11.3.2 He also participated in the illegal creation of suspense accounts which led to financial losses to VBS.

11.3.3 He knowingly received an irregular gratification for the manipulation of the VBS suspense account which caused financial loss to the bank.

11.3.4 He Intentionally falsified VBS financial records line items for Deposits and amounts owed to depositors amongst others. Leading to incorrect annual financial statements of VBS.

11.3.5 He manipulated the SARB DI returns which caused the SARB to

have an incorrect view of VBS level of capitalization, liquidity profile and capital reserves amongst others.

11.3.6 He failed to report large exposures and fraudulent transactions to the VBS board and the relevant authorities.

11.3.7 He processed many irregular transactions on his own without approval or supervision.

11.3.8 He was linked to a company called Lemawave. Payments were made from the Vele bank accounts to Phophi and Lemawave for the benefit of Phophi. These payments were irregular and corrupt in nature as they were rewards for his participation in the broader VBS corrupt scheme. Neither Phophi nor Lemawave had rendered any services to Vele Investments that entitled them to any remuneration from Vele Investments.

11.4 At the relevant time Solomon Maposa ("Solly") was the General Manager of Credit at VBS. To my knowledge, Solly was involved in irregular activities in the following manner:

11.4.1 He failed to report large exposures and fraudulent transactions that occurred in the credit department to the executive, the VBS board and relevant authorities.

11.4.2 He processed several irregular transactions on his own and without approval from his superiors.

11.4.3 He processed and approved irregular requests and credit applications from VBS executives, VBS board members and other participants without following VBS credit granting and approval policies.

11.4.4 He was aware of the irregular clearing of Vele and its related parties' overdrafts. He failed to report these to his superiors, the VBS board or relevant authorities.

11.4.5 He utilised his family and associates' entities as a vehicle to channel funds and receive irregular benefits which enriched his family, his associates' entities and himself.

11.4.6 I later became aware that Solly regularly processed transactions from customer accounts without their approval or instructions. This he did to sometimes siphone money out of their accounts or to assist strategic clients without their consent.

11.5 At the relevant time Ntendeni Sasa Nemabubuni ("Sasa") was the General Manager for Sales and Marketing at VBS. To my knowledge, Sasa was involved in irregular activities in the following manner:

11.5.1 He was involved in actively pursuing investments for VBS and the facilitation and payments of irregular commissions and kickbacks to municipal officials.

11.5.2 He was aware of the gratification scheme being paid to the VBS commission agents who in turn paid gratification to the municipal officials. He participated in cash delivery meant for gratuity payments to VBS commission agents and municipal employees alike.

11.5.3 I am aware that Sasa received gratification from me for the successful conclusion of certain municipal investments. He was granted an overdraft facility through one of his companies known as NAAP Holdings for his own benefit with the assistance of Solly.

11.6 Avhashoni Ramikosi ("Ramikosi") was the non-executive director at VBS and Chairman of its Audit Committee since 2013. After various discussions with Ramikosi regarding potential working partnership, I advised Ramikosi to open an entity that will be used to facilitate business between ourselves. Ramikosi facilitated the creation of an entity through an associate of his and submitted details to myself for creation of a shelf company. A shelf company in the name of Zanoware was dully registered around March 2016 for his control. The reason for the creation of an entity was agreed between myself and Ramikosi to avoid perceived conflict and secrecy that would arise. Ramikosi was the chair of the Audit Committee and an influential member of VBS board and his cooperation was crucial. Various payments were made with no explanations for the nature of service being rendered. To my knowledge, Ramikosi received the following major payments which were questionable and without basis:

11.6.1

Once Zanoware was registered and bank accounts opened within VBS I caused an amount of R250 000-00 to be deposited in Zanoware VBS account from Venmont Holdings. The deposit was made on 13 March 2017. There was no service rendered by Zanoware nor any agreement entered into.

11.6.2

Ramikosi received an amount of R200, 000 around July 2017. This money was a request from Ramikosi who asked if I could assist with anything. I then caused the R200 000 to be transferred to Zanoware for his benefit from Venmont Holdings. There was no service rendered or underlying business transaction for this payment.

11.6.3

During October 2017, I appointed Ramikosi as a Director for one of the Vele subsidiaries following Vele conclusion of its acquisition of Mvunonala. In celebration of the acquisition of Mvunonala I sponsored Ramikosi a trip to Mauritius. The amount that was transferred to Zanoware was R300, 000 from Venmont Holdings. He was also appointed as a non-executive director of Bophelo life during October 2017.

11.6.4

Following the curatorship of VBS in 2018, Ramikosi approached me to sign a loan contract in relation to all the monies he ever received from me. I agreed and signed the contracts and backdated them to reflect the dates when the monies were paid to Zanoware.

11.7 Ernest Nesane ("Nesane") was non-executive board member of VBS representing the PIC and he was the chairperson of the HR committee of VBS board. I met Nesane in 2013. To my knowledge, Nesane was involved in irregular activities in the following manner:

11.7.1 After I became the Chairman ofVBS in 2015, Nesane demanded shares in Vele. He was allotted convertible preference through his company called parallel. He wanted his shareholdership to be a secret lest it create a conflict of interest considering that he was already a non-executive board member at VBS representing the PIC.

11.7.2

He received irregular gratifications from Vele which were paid monthly to his nominated company. These gratuitous payments were irregular and never disclosed to either PIC or VBS.

11.7.3

He solicited and received cash of R5 million from VBS which he claimed was to pay PIC employees and certain executives to release payment for the Fuel Finance facility which had long been outstanding.

11.7.4

To avoid the conflict of interest arising at some instance he elected not to attend specific board meetings whereupon the issues relating to the approval of the R80 million Vele share subscription was on the agenda.

11.8 Paul Magula ("Magula") was non-executive board member of VBS representing the PIC and he was the chairperson of the Credit and Risk committee ofVBS board. I met Magula in 2013. To my knowledge, Magula was involved in irregular activities in the following manner:

11.8.1 After I became the Chairman of VBS in 2015, Magula demanded shares in Vele. He was allotted convertible preference through his company called Parallel. He wanted his shareholdership to be a secret lest it create a conflict of interests considering that he was already a non-executive board member at VBS representing the PIC

11.8.2

He received irregular gratifications from Vele which were paid monthly to his nominated company. These gratuitous payments were irregular and never disclosed to either PIC or VBS.

11.8.3

To avoid the conflict of interest arising at some instance he elected not to attend specific board meetings whereupon the issues relating to the approval of the R80 million Vele share subscription was on the agenda.

11.9 In 2016, Robert Madzonga (0Madzonga") was initially appointed as the Chief Operating Officer ("COO") designate of VBS. However, when his nomination was presented to the SARB, SARB declined his appointment to this position. Vele then appointed Madzonga as its COO in 2016 and later as its CEO. I viewed Madzonga as an experienced person who was going to help in the overall structure of Vele.

The reason why the SARB declined the nomination of Madzonga was based on a media allegation relating to his previous employment at MTN-SA. Madzonga indicated that he left MTN-SA amicable as he was never charged by MTN-SA, hence the SARB decided to decline his nomination. Madzonga was included in the PIC initiatives to raise funds because he was representing Vele which was a shareholder at VBS. The payments to Madzonga were linked to his employment contract with Vele.

I first met Madzonga in 2015. To my knowledge, Madzonga was involved in irregular activities in the following manner:

11.9.1 He conducted various underhanded and undisclosed dealings between Vele and companies that he was appointed to oversee. I became aware that Madzonga was receiving irregular payments from Vele subsidiaries, Black Label Telecomms, Firmanox, Wegezi, Foxburg, Sabicorp and many others. His modus operandi was to misrepresent facts to have a Vele subsidiary release funds to him.

11.9.2 After the VBS curatorship Madzonga illegally claimed money from a company called B3 Funeral and Insurance which had received a loan amount of R10 million from Vele that remained unpaid at the time.

11.9.3 Madzonga irregularly transferred an amount of approximately R1O million from Vele into his attorney account namely Tshivhase Attorneys. From this transfer I was paid an amount of approximately R2 million for my Vele unpaid salary and legal fees.

11.9.4 After VBS curatorship, Madzonga sold some of Vele and Mvunonala motor vehicles for his own benefit.

11.10 Sipho Malaba ("Malaba") was the audit partner at KPMG and was the engagement partner responsible for VBS audit. I first met Malaba during 2012 when I was visiting KPMG offices. To my knowledge, Malaba was involved in irregular activities in the following manner:

11.10.1 When VBS and KPMG were busy finalising the 2016 audit, Malaba informed me that he and his partner had a property company and he enquired if he can get a mortgage bond facility from VBS. I referred him to Solly to assist in processing the facilities. Malaba ultimately received large value facilities for the benefit of his property company.

11.10.2 Malaba obtained overdrafts from VBS, and at one point he asked me for an increase in his overdraft limit by R3 million through a WhatsApp message. I referred Malaba to Solly to facilitate the increase in facilities. I doubt that any of the normal VBS credit granting processes and procedures were complied with.

11.10.3 I know that an annual independence checklist was sent to VBS

from KPMG in relation to Malaba, I doubt that it truly represented Malaba's position relating to his and related parties' exposure to the bank as I knew he had multiple facilities that would compromise his perceived independence if disclosed.

11.10.4 I can recall during June 2017 while the year-end audit was at finalisation stages, Malaba had a meeting with Truter regarding outstanding Audit matters for Partners attention. After this meeting, Truter sent me a message and indicated that Malaba had agreed to VBS classification of SAMOS reconciling items as cash and cash equivalents in the balance sheet. Malaba also called me and informed me that the classification matter has been resolved and that he is giving the bank 12 months to finalise all outstanding reconciling items. I contacted Truter and informed him of the conversation. Malaba in his capacity as audit partner personally cleared the R700 million unreconciled cash audit query raised by his juniors, including the audit manager. The clearance occurred without any further substantive procedures being performed. The explanation can only be that he was already indebted to VBS and went out of his way to conceal this material audit difference.

11.10.5 Malaba was linked to two companies called Bentanologix and lhaawu Lesizwe. Mortgage bonds, vehicle finance and overdraft facilities were granted to these companies by VBS. These facilities were granted irregularly in nature because:

• Neither Malaba nor the companies involved qualified for the facilities granted by VBS.

• Of the mortgages granted to these companies, related transfer costs were paid by Vele companies on behalf of these companies, and this was never questioned or queried by Malaba.

• lnstallments on the mortgage facilities and overdrafts were never serviced for the entire duration. This clearly indicates that he had no intention of repayment.

11.10.6 Malaba was involved in writing pre-emptive reports meant to

shield VBS. The first such pre-emptive report was on related parties and large exposures. This was after he warned me that PwC and the SARB were questioning transactions with related parties. The second report was to cover up the SMME Bank of Namibia. On this second report I remember that the scope was highly restricted, and the report did not focus on the merits of SMME Bank complaints.

11.10.7 Malaba as an auditor in charge and based on his experience as an Audit Partner should have been immediately aware that because of the above facts, that VBS control environment and credit risk are very high. He should have therefore paid more attention and investigation in this aspect. However, as he was himself benefiting through corrupt means he chose not to act on these risks.

11.11 To my knowledge Kabelo Matsepe ("Matsepe") is a businessman. He was involved in a company called Moshate Investments (Moshate"). Moshate was also an agent for VBS appointed for purposes of sourcing investment deposits. I met Matsepe for the first time around August 2016. at the Waterfall Estate Shopping Centre with a newspaper journalist called Setumo Stone ("Stone"). 

The meeting was due to issues surrounding investment that Capricorn Municipality made with VBS. had accepted a deposit from the Capricorn Municipality in contravention of the Municipal Finance Management Act ("MFMA"). This was the first time that I was aware of the MFMA restrictions. Stone had indicated that he was preparing to write a story about the irregular deposit made by Capricorn. Stone wanted a comment and explanation from me as a representative of the bank.

Matsepe was also in this meeting as it seems that this complaint from a person in the municipality around the investment was made also at a political level. I gave them an explanation that VBS has been collecting investment deposits from various other municipalities without any issues, and that VBS is a fully registered bank in terms of Mutual banks act.

I managed to convince them that this was all legitimate and I informed them that the SARB was aware of this strategy. I further informed them that we will be placing a lot of emphasis on getting more investments from other municipalities. Matsepe and Stone left after this meeting convinced that the investments were all legitimate.

I later met up with Matsepe at the Fusion Boutique Hotel in Polokwane with Danny Msiza ("Danny"). To my knowledge Danny was Matsepe business partner. Matsepe was very interested in being appointed as a commission agent for VBS.I had indicated that VBS would pay a commission in the region of 2% for any investment that could be sourced by him from the municipalities.

I knew that Matsepe and Danny were well connected politically and that they would be able to use their political influence to secure investments from municipalities especially in the Limpopo province. For this reason, Danny and Matsepe representing Moshate were appointed as commission agents for VBS. To my knowledge, Matsepe was involved in irregular activities in the following manner:

11.11.1 Matsepe would regularly discuss strategies and proposals to generate more municipal investments. The discussions would further be around VBS making additional funds available for gratifications of municipal officials.

11.11.2

We regularly discussed strategies and proposals to generate more municipal investments and the discussion would be around making additional funds available to bribe municipal officials.

11.11.2

I knew that the gratification payments were intended to induce the municipal officials to place new investments with or roll over existing investment with VBS.

11.11.3

I was aware that Matsepe had regularly claimed commission payments on municipal investments that were sourced by other commission agents. He would put a lot of pressure on Andile, Phophi and Myself and force us to make a payment to him under threat that he would then tell the municipal officials to withdraw the investments immediately.

He used the excuse that the municipal officials were upset that they have not yet been paid and he was an expert at manipulation as he said that he had numerous negotiations with officials, and they were expecting payment. I can recall that I was required to intervene on complaints between Matsepe and Sasa or commission agents on the following municipalities investments:

- Polokwane

- Vhembe

- Makhado

11.11.4

Around 20 December 2017, I received a WhatsApp message from Matsepe requesting that a gratuitous payment be made to the then Mayor of Vhembe, Mrs Florence Radzilani ('1the Mayor"). I had never met the Mayor and most of the Vhembe municipality staff as I was not "customer facing" at the bank. In that WhatsApp message, Matsepe informed me that the Mayor wanted "Christmas" money as the R300, 000 that was already paid to her and the Speaker was not enough for the job they were doing.

The gratuitous amount Matsepe was requesting was R1,5 million. This payment could not be made, and it was agreed that this request will be finalised after December holidays. On 16 January 2018 I received a long WhatsApp message from Matsepe regarding this issue. It appeared to me that Matsepe had discussed with Phophi about the gratuity being requested as payment to the Mayor.

It further transpired that Phophi had wanted the Mayor to invoice VBS directly using her own entity to ensure that such amount indeed would end up in the Mayor's hands. Alternatively, the other option was that Sasa be the person who delivers the said to the mayor by hand. However, Phophi's proposal did not sit well with Matsepe/Danny.

I agreed with Phophi and Sasa's concerns considering that at this juncture we at VBS had become aware and weary of Matsepe's double dealings. In this regard there had been instances in the past where municipal staff had been promised funds by either Matsepe or Danny, yet they never received or were paid such despite such amounts having been hugely inflated by Matsepe and Danny's own benefit.

Whereas the initial gratuity requested for the Mayor in December 2017 was R1,5 million, in January 2018 that requested amount had been inflated by Matsepe to R2 million. In view of the intensified and premature withdrawals by municipalities during that period we then succumbed to Matsepe's demand for the R2 million payment and paid that amount into Moshate account. The investments in question in Vhembe were rolled over as Matsepe promised.

11.12 To my knowledge Daniel Msiza ("Danny") was a politician and at the relevant time he was Provincial Treasurer of the ANC in Limpopo Province. Danny did not have a direct relationship with VBS. His involvement with VBS comes by way of his association with Matsepe and Moshate.

I met Danny for the first time at the Fusion Boutique Hotel in Polokwane around August 2016. At the time the three of us had discussions regarding how Matsepe's company i.e. Moshate could be appointed by VBS as a commission agent for municipal investment purposes.

It was clear to me that Danny and Matsepe were very close to each other, and I even joked that they were like father and son. Following these discussions the three of us agreed that Danny would also be involved in securing municipal investments. Through his position, Danny succeeded in convincing political office bearers in Municipalities. To my knowledge, Danny was involved in irregular activities in the following manner:

11.12.1 In regard to the Thulamela municipal investment with VBS it took Danny's involvement for the investment to materialise after him having put pressure on the Thulamela Municipality Mayor to invest in VBS. I was present when sometime late 2016, the Mayor of Thulamela municipality was summoned to African Pride Hotel by Danny and Matsepe.

VBS had already made an investment proposal to Thulamela Municipality, and they had been unresponsive. At this meeting Danny placed political pressure on the mayor. Shortly after this meeting an investment was made by Thulamela municipality to VBS around December 2016.

11.12.2 For assisting VBS in securing municipal investments, Danny would be paid out of commission paid by VBS to Moshate. To my knowledge, Danny's rewards for his involvement by using his political influence which would lead VBS securing municipal investments, Matsepe and Moshate were effecting such a reward from agent's commission received from VBS.

11.12.3 I can recall cash that was made available to Danny for the African National Congress (ANC) conference. The amount was requested by Danny and Matsepe, of which there was no formal request from the ANC but I took their (Danny and Matsepe) word. I directed Sasa to arrange collection of the requested money and deliver it to Danny around August 2016 at the Fusion Boutique Hotel in Polokwane. It amounted to R200, 000. Under normal circumstances Danny's political interventions and activities would normally be supported by Andile and I. I understood that Danny's power benefitted VBS indirectly with the municipal investments.

11.13 To my knowledge Raliom Razwinane ("Raliom") was the owner of a company called Gundo Wealth C'Gundo"). Around 2017 I learned that Gundo has been appointed as an agent for VBS to source investment deposits. Post Gundo's appointment, Raliom was introduced to me by Tsumbo Matambela who was working at VBS in the office of the CEO. By the time I met Raliom, he had already been appointed as a commission agent by Andile.

He was highly experienced in the investment space and knowledgeable regarding several investment products that VBS was not even offering yet. He knew many influential people within the investment space including the then DG of National Treasury Mr Dando Mogajane with whom he had a close relationship. To my knowledge, Raliom was involved in irregular activities in the following manner:

11.13.1 According to my knowledge, he had links with many institutions, including but not limited to the Polokwane Municipality, Free State Development Corporation and the Community Schemes Ombud Service (CSOS). In his role as a commission agent for VBS he assisted in securing investments for VBS for which he would receive an average of 2% of such capital investment.

11.13.2 Whilst in Johannesburg, sometime in 2017 Raliom introduced me to the CFO of Polokwane Municipality by the name of Mr Nazeem Essa. The three of us had an informal meeting. In this meeting Raliom mentioned that Mr Essa was the person that was assisting him with Polokwane Investments. At that time VBS had already an investment from Polokwane Municipality through Raliom.

11.13.3 I can recall a specific incident where I had to intervene between Raliom and Matsepe regarding the commission claims in respect of an investment that had been made by the Polokwane Municipality to VBS. Both Raliom and Matsepe were claiming that each one of them had independently facilitated that investment. The conflict was resolved after I had convinced them to share the commission and accept 1% each.

11.13.4 Around August 2017 VBS started receiving enquiries from municipalities regarding communication from National Treasury which was informing them (Municipalities) to withdraw their Investments from VBS since the MFMA prohibits any such Investments with a Mutual bank of which VBS was; see copy of communication attached herewith, marked and annexed as TM-2. I discussed this with Raliom who informed me that he had a close relationship with Dando, and he will arrange a meeting between myself and Dando. To my recollection I had at least five meetings with Dondo.

One of those took place at Pedro-Portia Cigar Lounge at Cedar Square in Fourways. The other meeting took place at VBS offices in Rivonia whilst the third meeting took place at Eagle Canyon on 8 October 2017. The other meetings we had Treasury and the Reserve bank. In all these five meetings it was never just me and Dondo but one or two other people.

11.13.5 Present at the Pedro-Portia meeting was Myself, Dondo, Raliom, a Gentleman by the name of Chuma and a lady whose name I would later come to know as Dr Mkhize. Whilst the discussion was still on this National Treasury letter to the municipalities, Raliom then softly whispered to me regarding our earlier agreement that I should pay an amount of R1 million to Dondo.

That is when Raliom shared a whisper with Dondo and then Dondo said a million rand is fine, nodding his head. In short, the purpose of this meeting was none other than to confirm the payment of R1 million and the bank account where it was to be made. I then enquired from where this payment was to be made and that is when Raliom received a piece of paper from Dr Mkhize and in turn handed that piece of paper to me.

On that paper were the banking details. I then enquired if these were the banking details into which I was to make that R1 million payment. That will be when Dondo said yes nodding his head. I then left the meeting and the four of them remained.

11.13.6 Following the above an amount of R1 million was paid into the provided Standard Bank account with account number: 023386223 belonging to Baphilile Foundation NPC; see copy thereof attached, marked and annexed as TM-3. To my knowledge this foundation is under the control of Dr Mkhize.

The payment was intended for Dondo to intervene and to facilitate the withdrawal of the National Treasury letter and to grant VBS the special dispensation of 18 months for it to continue to accept the Municipal investments. At the time VBS had already started the process to convert into a commercial bank and in VBS view the envisaged 18 months would have been sufficient for the process to be expedited.

11.14 Edgar Mucheke and Tshianeo Madazhe were involved in a company called TNE advisory services ("TNE"). TNE was also appointed as a commsions agent for VBS to source investment deposits. I cannot recall meeting with or speaking to Edgar Mucheke and Tshianeo Madadzhe of TNE.

However, I have been informed by Sasa that there was a new commission agent appointed who also had experience having done similar work for Investec. I was further informed that they had brought in amongst others Collins Chabane and Giyani Municipalities. I have no further intimate knowledge of their involvement with VBS.

[WATCH] The former Treasury head, Dondo Mogajane, denies allegations of receiving R1 million from convicted VBS executive Tshifiwa Matodzi.

READ FULL STORY: https://t.co/BV9LLKx0i9 pic.twitter.com/II3mFlU3O7

— Sunday World News (@SundayWorldZA) July 12, 2024

12.

MY ROLE INTO THE COLLAPSE OF GORVERNANCE AT VBS:

I would like to discuss a brief history of myself and my role as a person of interest in the breakdown of governance within VBS, which ultimately led to the collapse of VBS.

12.1 After passing matric I enrolled for B Com in Accounting at RAU. I obtained my CTA/Honours degree in accounting and proceeded to KPMG to commence with my articles training. I qualified as a CA and later worked for NKonki Sizwe Ntsaluba (now SNG), Ernst and Young in various roles before heading for the corporate world where I was GM: Finance at Denel Corporate.

Sometime in 2004 I followed my entrepreneurial ambitions and co- founded a company called Brilliant Telecommunications ("Brilliantel") with a friend that I have known since my RAU days. Brilliantel grew and is currently one of the largest black-owned ICT companies in the country. It was while I was still in Brilliantel that through Dyambeu I had shares at VBS. I later became the Chairman of the board of VBS. I ceased to be director and co-owner of Brilliantel sometime in 2016.

12.2 While at VBS, in both my capacity as shareholder representative of Dyambeu and later as chairman of Vele and subsequently as chairman of the VBS Board, I became involved in and participated in the following irregular activities:

12.2.1 Issuing instructions without executive authority:

12.2.1.1 I began issuing instructions directly to VBS staff once Dyambeu became a shareholder. Some of these instructions would range from choosing best suppliers and engagement with technology partners.

12.2.1.2 After becoming the chairman of the VBS board, I would regularly make requests for loans and or overdrafts increases thereof for use by my companies or those of associated with me in one way or another. In some instances, these loans were approved without following the credit policies of VBS. In other instances, these loans would be approved to people whose credit profiles were of unacceptable levels based on VBS credit policy. These practices introduced excessive credit and liquidity risk to VBS.

12.2.2 Involving myself in promoting unlawful activities in municipalities and investee entities.

12.2.2.1 I knowingly participated in the formulation and promotion of unlawful activities either alone or in cahoots with other participants, both within and outside VBS in the acquisition of investments from municipalities around the Republic.

12.2.2.2 The above was achieved with my active participation in

compromising municipal officials through offers of gratification. This was done with my approval and knowledge.

12.2.2.3 Officials that were deemed strategic in these entities were actively encouraged to apply for loans at VBS or to move to VBS their existing banking and loan facilities that they held at other banks. The loans to these individuals were granted without following strict credit policies of VBS and/or ignoring the individual's adverse credit profile.

This was deliberately designed to ensure that these individuals are permanently indebted to VBS whilst they remain employed at their respective entities. It was further intended that even when they change their employment to other entities or similar positions elsewhere their indebtedness would remain due and payable, thereby ensuring that they remained biased towards VBS.

12.3 Creation and abuse of suspense accounts within the bank whilst I was the chairman of the VBS:

12.3.1 I became involved with a few other colleagues within VBS, in a rogue deposit-suspense accounts creation scheme. These deposit-suspense accounts were the main cause of VBS collapse through availing non-existent cash to Vele and its entities.

12.3.2 This deposit-suspense account scheme involved creation of fictitious deposits through manipulation of "deposits" into suspense accounts which were later credited either to companies owned by myself, my associates, certain bank officials and my family members. After creation, these deposits were immediately available for use or withdrawal even though no real cash was deposited. This led to VBS running out of cash.

12.3.3 Myself and my accomplices utilised the money from the suspense account to acquire big companies. It also enabled us to finance our expensive personal lifestyles at the expense of the real depositors. I literally abandoned my ethical and moral responsibility to VBS, its real depositors, shareholders, stakeholders and any governance principles that I had adhered to throughout my years of training and acquired during my previous financial services experience.

12.3.4 This scheme became out of control due to its easy and simple nature to implement, to the point that the bank lost its ability to effectively perform cash management and liquidity control. There were simply uncontrolled withdrawals of money by us that never existed in the first place. The greed by myself involved prioritising my own payment plans over those of legitimate needs of VBS to lend money to qualifying clients or to invest excess money in liquid money markets for the benefit of VBS and its shareholders/depositors.

12.3.5 Through creation of these fake deposits, I obtained majority control of VBS through acquisition of VBS shares. This invariably led to the prejudice of legitimate shareholders of VBS, effectively diluting their shares and thus rendering them minority shareholders in their own bank.

12.4 Involvement in falsifying financial records and misleading the VBS board:

12.4.1 Although aware, I never questioned those involved in preparation of and the sending of false DI returns to the SARB. I was further aware and sometimes I would even participate in the preparation of the financial records for the Annual Financial Statements, the PIC and auditors, thus misleading them while knowing the true state of affairs.

12.4.2 My actions of meddling with the executive functions had

the effect of compromising, misleading and weakening the VBS board which rendered it unable to effectively perform its duties in the following manner:

a) I participated in deliberately withholding certain information intended for various committees of the VBS board. I achieved this through collusion with certain members of the executive within VBS.

b) I kept silent on non-compliance with policies and delegations which I had become aware of as I was also party to flaunting them with some executives.

c) I was aware of certain transactions that were approved at executive level and that normally required board approval which I never questioned but allowed them to quietly proceed.

13.

MY FAMILY MEMBERS AND OTHER PERSONS' INVOLVEMENT:

13.1 I now turn to my family members and other persons involvement:

13.1.1. Mrs. Stephinah Alidzulwi Matodzi ("My mother")

13.1.1.1 My mother is 74 years old. Phillip Tshililo, then a branch manager at VBS Thohoyandou branch is the person I had tasked to assist my mother, family members and myself with every banking related issues at VBS.

13.1.1.2 After I developed a relationship with VBS as a shareholder, my mother opened for herself personal and business accounts at VBS. At the time when VBS shares became available I informed my mother, and I gave her money to purchase those shares. I would instruct Mr Phillip Tshililo to transfer money into her VBS accounts whenever she requested money. At times I would arrange for her to collect cash from Mr Phillip Tshililo. This money would have been debited from one of my personal or Vele accounts in VBS.

13.1.1.3 The following are the entities that are known to me in which at the time my mother was the director or the trustee:

a) Africasana;

b) Shimba La Ndou Trust; and

c) Masindi Resort

i. In relation to Africasana my mother did not control this company. This company received an overdraft of R4,5 million from VBS.

ii. In respect of Shimba la Ndou trust my mother did not control this trust. This trust received an approximate total of R14 million from VBS, R7 million being a mortgage bond and the other R 7 million as an overdraft.

iii. In relation to Masindi resort my mother controlled this entity. This company received no loans and facilities from VBS.

iv. Around 2016, a continuing coverage mortgage bond was registered over a property owned by my mother. The said property was stand 1095 Block F in Thohoyandou. The covering bond was registered for an amount of R5 million. This was done in case my mother applies for an overdraft to finance her bakery business in Africasana in future and the property will stand as surety for the loan.

All bank processes were followed in the registration of this covering bond at the time and the property was independently valued at R3,5 million. She however never applied for any loan in VBS. Africasana was later used by myself through Vele and an overdraft of R5 million was loaded without her knowledge.

I used the facility in Africasana to make various payments mostly for Vele related issues. There were payments processed from Africasana VBS bank account for purchases of items for her house. These payments totaled around R1,2 million. The moment Africasana was loaded with overdraft the management of the VBS account was by myself.

13.1.2 Takalani Matodzi ("Takalani")

Takalani is my brother and I employed him at Venmont Build Environment around 2015.Venmont Build environment was a Vele subsidiary. His duties were to source land for development, mainly for residential units developments. He would present to me for approval all land that would have been sourced since I was responsible for organizing finance. The following are companies where Takalani was appointed as director by me and role he played:

Venmont Built Environment ("Venmont")

At Venmont Takalani was not involved in the day­ to-day administration, which would have included the payments from bank accounts, or organising overdrafts and loan facilities. Overdrafts in this company's accounts were arranged through Vele by myself without Takalani's knowledge. Following the meeting held at Eagle Canyon on 19 March 2017 Vermont's overdrafts account amounting to R15, 700,000 was cleared. Takalani was not aware of the Venmont overdraft nor the subsequent clearing thereof.

The financing was sourced from VBS through my interventions and mortgage bonds were registered against these properties. During the early stages when I was not yet the chairman of VBS I personally provided security against the first land purchase using my property in Eagle Canyon as additional security.

Takalani never performed any administrative or banking activities as those were handled by myself through my personal assistant, Miss Takalani Mmbi. The following were companies that were controlled by myself through Vele, and that Takalani held directorships:

Venmont Holdings

To my recollection, Takalani was the only director of Venmont Holdings prior to its name being changed to Venmont Holdings. Venmont holdings was administered by myself through my PA, Ms Takalani Mmbi. I personally organised overdraft facilities for Venmont Holdings. Venmont Holdings' overdrafts were cleared because of the meeting held at Eagle Canyon on 13 March 2017. Takalani was not aware of the overdraft nor the subsequent clearing thereof.

Robvet

From the records with CIPC this company was incorporated on 22 April 2016 with Takalani as its sole director and he resigned from this company as a director on 13 May 2016. I only became aware of Robvet sometime in 2016, when I was having discussions regarding commission payments with Solly. Solly mentioned that he uses a company called Robvet to pay commissions.

I enquired from Solly as to who the director of the company was and Solly mentioned that it was his cousin, Mr Rabelani Ramuntshi. I left it at that, and I also started using the company as a slush fund for payment of agent commissions and at times my own personal expenses. Robet was under Solly's control and later Phophi took control of it.

13.1.3 Aluwani Matodzi ("Aluwani")

13.1.3.1 Aluwani is my sister. Between 2016 and 2018 VBS granted her two facilities namely Motor vehicle finance and home loan. 13.1.3.1 Around 2017 I assisted Aluwani with her bond application document at VBS. At the time I had employed her to consult Vele regarding starting a fleet management company as she had expertise in the area. I offered her a monthly fee of R30, 000.

At the time of her bond application with VBS I requested a company called Proforum Accountants to draft a proof of income letter for income of R107, 000 on her behalf. The basis for the letter was the R30, 000 income she received from Vele and a contract her company Winisource had with a client called MK Exotics. MK Exotics was paying Winisource a monthly rental fee of around R44, 000.

The balance of her income was made from ad hoe invoices with her clients which I did not verify. This letter was at my request and was forwarded to VBS. I thus take responsibility for the remainder which was inflated as the request letter for the confirmation of income was made by myself.

13.1.3.2

The motor vehicle was approved by VBS on 18 May 2016 the installments were paid from Winisource VBS account, total payments paid from Winisource VBS account from May 2016 to April 2018 amounted to around R77, 000. Winisource received payments from Vele for services rendered or for payments I directed being paid to it.

After April 2018 and post curatorship, she continued to pay installments from her own funds/employment and the account has since been fully settled and closed. VBS approved Aluwani's mortgage bond on 10 November 2017. The mortgage bond was registered on 28 February 2018. Her first installment was due on 31 March 2018 and the bond account was serviced from April 2018. The mortgage bond continues to be serviced.

13.1.3.3

Aluwani owned a company called Winisource. Winisource had a bank account with VBS. I would regularly make payments to this account through Vele or its entities for ad hoe requests. I assisted with the payment of bond costs for R580, 000 which was paid by myself to Winisource. There was also payment to Winisource for an invoice when Vele Private Equity was hosting an opening function in Cape Town. I had requested Aluwani to source a company to transport delegates to the event.

13.1.3.4

Winisource invoiced and was paid by one of Vele subsidiaries. Winisource was not a recipient of VBS overdrafts. Aluwani was not aware nor formed part of corrupt activities at VBS.

13.1.4 Shonisani Difotso {"Shonisani").

13.1.4.1 Shonisani is my sister. I would occasionally gratuitously assist her with money whenever she was in need over a period. Most financial assistance involved assisting her with personal expenses, debts and her child University tuition fees. My estimate total financial assistance from 2016 to 2018 is around R360, 000. Shonisani did not have any credit or loan facilities with VBS.

13.1.4.2 Thabelo Grace Matodzi ("Thabelo") was my wife. Our divorce was finalised around 2018. She received spousal allowance from myself totaling around R100, 000 a month and paid into her FNB account. This was basically a compensation of her being a housewife and no longer working as a Chartered Accountant. Around 2017, I appointed her as CEO of a new Vele subsidiary called Venmont Foods. All facilities and overdraft of Venmont foods were arranged directly by myself. Thabelo was not aware of the corrupt activities that were happening at VBS and Vele.

13.1.5 Mr Phillip Tshililo ("Tshililo")

13.1.5.1 Mr Tshililo's role has already been described in sub paragraph 13.1.1 above.

13.1.6 Takalani Mmbi ("Mmbi")

13.1.6.1 I worked with Takalani Mmbi since my days at Brilliantel where she occupied the position of financial manager. At the time I was both the CFO and co-owner of Brilliantel. When I moved to Venmont around 2015, I recruited her as my personal assistant and accountant thereat. Mmbi was never involved nor aware of my actions at VBS or Vele.

I tasked her to procure shelf companies of which I would appoint her as a director until the entities become operational. I am not aware of any companies she opened outside of my instructions save for entities relating to stokvel savings clubs with her friends and co-workers, which she would inform me about.

13.1.6.2 Mmbi received a monthly salary of R150, 000 net from Vele which was paid through Vele VBS account or one of its subsidiaries. Any other payment or claim by her would be paid to her after my approval.

These payments amounted in all to approximately R139, 000 paid over the total period of her employment at Vele. She also had a mortgage bond at VBS, and I assisted her with the bond costs. I remember she had bought VBS shares of a small amount, and I recall assisting her to get more shares at VBS

13.1.6.3 Mmbi is the person who provided Matsepe and

Maluleke with the documents of Vele motor vehicles and her computer hard drive during the VBS curatorship. This she did on my instructions since at the time I was out of the country.

14.

PART C - MUNICIPALITIES (14-17)

MUNICIPAL INVESTMENTS:

14.1 The strategy to approach municipalities to invest with VBS was adopted in the turnaround strategy which was approved by the VBS board around August 2014. Initially the investments were to be sourced in-house through the VBS marketing department which was headed by Sasa.

During the initial stages I was involved with Sasa in drafting the presentation material and setting up appointments with municipalities I had relationships with. At a later stage I became involved with Sasa at a technical level when challenges around interpretation of MFMA arose. After this phase I was not involved in the client­ facing aspect and I left this function to the executive, consultants, and commission agents to deal with.

However, as Chairman of the board I was informed on a regular basis regarding the status of all the investments. I received updates regarding what liquidity and cash position of the bank was and these I received in the form of weekly reports, cell phone messages and verbal feedback. I even received updates in the following aspects of all the municipal investments:

a} Potential investments, b) Maturities, c) Current investments, d) Investments due for rollover, e) Investments on notice, f) Resolving standoffs between bank officials and commission agents regarding commission payments and bribes.

14.2 Decision to accept municipal investments was part of VBS strategy which was approved by VBS board. The strategy was also submitted to the SARB and presented to all subsequent tri-lateral meetings between VBS board, SARB and VBS auditors (PwC and KPMG).

14.3 All investments received from municipalities were disclosed to the SARB through monthly SARB DI returns.

14.4 Around June 2016, during my discussions with Sasa around the Capricorn investment, it became clear that there were potential legal issues in terms of MFMA regarding municipal investments to VBS which is not a bank as defined in the MFMA. The issue from Capricorn was that their own investment policy required their investments to be placed at financial institutions with an investment grade rating.

This is also a requirement in terms of the MFMA and as VBS, we discovered this when the Capricorn Municipality queried the investment grade rating. It was from this query that as VBS we realised that there were compliance issues with regards to MFMA. The potential legal challenges regarding MFMA compliance were reported to the VBS board and SARB, and the National Treasury was also notified.

15.

I will be dealing with the following municipalities that I had personal dealings with which are the following:

15.1 West Rand District Municipality ("West Rand")

15.1.1 I knew the Municipal Manager of West Rand, i.e. Mr David Mokoena ("Mokoena"). I had known him for a long time since his days at Mogale City where he worked with my father. Later, I would engage with him through Brilliantel which had a contract with the Mogale City municipality. Mokoena was like family myself and Maanda Phalanndwa ("Maanda"}. Maanda was Brilliant's co-owner and current CEO.

15.1.2 West Rand was the first municipality to Invest in VBS. Mokoena and Sasa had already known each other when Mokoena applied for bond facilities with VBS in 2014. Mokoena did inform me that he contacted Sasa for the purposes of the initial investment. Sasa was in turn introduced to West Rand employees by Mokoena.

Once Sasa engaged with staff at West Rand, Mokoena and I never discussed West investments and it was left to Sasa and relevant municipal staff. After that, I was involved on an occasion regarding an issue which involved West Rand's CFO named Romeo Mohlaudi. This issue concerned a rollover and Mokoena, being the Municipal manager, had to call me seeking clarity in this regard.

15.1.3 Mokoena was aware of my VBS share acquisition endeavors through Brilliantel since 2012/2013. Once municipal investments strategy was approved by VBS board, I informed Mokoena that VBS had a product which catered for Municipal investments. Mokoena had wanted to become part of Brilliantel/Dyambeu consortium earlier but when things didn't work out, Maanda and I promised him that we will buy him his own shares outside the Dyambeu structure.

When I met Mokoena at one of for the investment proposal, he reminded me about the shares we promised him. This reminder had been ongoing for a while. Maanda and I had decided that then agreed that I give Mokoena my personal shares. This I did, hence my arrangement with Sasa that he transfers one of my personal share certificates holding 10 000 shares to Mokoena.

I never claimed this payment as refund at VBS as it had nothing to do with VBS, nor had I ever requested payment of commission to him as was the normal modus operandi at VBS throughout the many investments made by West Rand. Throughout my dealings with Mokoena no bribe was negotiated by us. Neither was the first investment made by West Rand the result of unlawful dealings between us. To my knowledge Sasa nor any VBS employee never discussed any irregular payments being made to Mokoena.

15.1.4 Sasa informed me that was involved with the CFO, Mr Romeo Mohlaudi ("Romeo") and some of Romeo's juniors in the investment solicitation and payment of bribes. I had full knowledge that bribes were being paid for the investments and for the rollover of investments. I was not able to know specific details of every transaction, amount or who was paid when and how much and by who.

15.2 Thulamela Municipality ("Thulamela")

15.2.1 I knew the Mayor of Thulamela at the time i.e. Mr Mushoni Tshifhango ("Mushoni") since our days as students at RAU. At some stage he set up a meeting at the municipality whereby I joined Sasa for an investment presentation to the Mayor and his team. However, at that time Mushoni was not a mayor yet at Thulamela. After this presentation no investments were made for a period. It was only after Danny's intervention at the African Pride hotel during 2016 that an investment was made. I know that Mushoni received a bribe in the form of a motor vehicle since I'm the person who through the Robvet VBS account bought him a Jeep Cherokee.

15.3 Capricorn Municipality (11Capricorn")

15.3.1 Capricorn was introduced by Sasa through his connections within the Municipality. I was not involved in the solicitation of the investment and Sasa handled everything. I only became involved when sometime in June 2015 Sasa called me informing me that the deputy CFO of the Capricorn had issued an instruction to municipal staff to withdraw funds invested with VBS. The reason for the instruction was Investments of Municipal funds were not in compliance with MFMA.

15.4 The Rest of municipalities ("The rest")

As more commission agents were on-boarded within VBS to assist Sasa and his team, my role became more of a facilitator and resolving issues between bank officials and commission agents. For this reason, I do not know many of these municipal officials and their detailed dealings with staff at VBS or commission agents.

The details I came across were through engagement with bank staff or information disclosed to me by those involved. Besides Moshate and Gundo, I do not remember meeting or engaging with other commission agents that were on-boarded by VBS. I was however aware of irregular payments that were being made to officials and some of the commission agents' irregular dealings.

16.

THE MEETING AT THE RANCH HOTEL IN POLOKWANE

16.1 Around September 2016, I was informed by Matsepe that there would be an ANC Premier's lmbizo where the Premier of Limpopo province had invited MECs, Mayors and Municipal Managers. I saw this lmbizo as an important opportunity to market VBS investment products. During my discussions with Matsepe, he informed me that through the assistance and influence that Danny had as the ANC Treasurer-General in the province, at the lmbizo he (Danny) would avail the municipal officials for VBS to pitch and/or present the municipal investment products to them. I was supposed to attend this lmbizo, but I felt that Sasa should rather attend as he was the GM of Sales and municipal investments fell under his department. The imbizo was held on 19 September 2016 and Sasa attended. I was in contact with him, and he updated me on how the engagements went on that day. It took a while before the investments started flowing in after that imbizo.

16.2 I noticed a marked increase of investments during 2017 and I associated this with the Ranch meeting.

17.

COMMISSION AGENTS:

According to my knowledge, VBS had no policy on procurement of services by commission agents. Payment of commissions to commission agents for services rendered was governed by the contracts between the commission agents and VBS. These contracts were designed along industry norms for soliciting investments in municipalities and other institutions. The different commission agents are now being discussed hereunder:

17.1 Moshate Investments ("Moshate"):

17.1.1 I had referred Matsepe to Andile for conclusion of commission agent contract between Moshate and VBS. This was done between Andile as CEO of VBS and Matsepe as Moshate's representative.

17.1.2 I was not aware if Moshate was compliant with FSCA requirements or not. However, I recall that Moshate had not provided investment advisory services to clients before.

17.1.3 Hereunder is the list of municipalities where Matsepe was involved:

• Vhembe District Municipality

• Makhado Municipality

• Fetakgomo Greater Tubatse Municipality

• Mafikeng Municipality

• Elias Motsoaledi Municipality

• Ephraim Mogale Municipality

• Makhuduthamaga Municipality

• Polokwane Municipality

• Collins Chabane Municipality

• Giyani Municipality

17.2 Gundo Wealth ("Gundo"):

17.2.1 To my knowledge Gundo was compliant with all requirements for investment advisory services.

17.2.2 During an introductory meeting between Raliom and myself, he highlighted the fact that his company had all the required certifications with FCSA.

17.3.3 Hereunder is the list of municipalities and entities, that I can still recall, where Gundo was involved:

• Polokwane Municipality

• Dr Ruth Municipality

• Free State Development Corporation (FDC)

• Community Schemes Ombud Service (CSOS)

17.3 TNE Advisory Services ("TNE"):

17.3.1 I was not involved with the on-boarding process ofTNEAdvisory Services.

17.3.2 I was not aware if this commission agent was compliant with the FSCA requirements or not. However, recall Sasa mentioning to me that this commission agent was providing similar services to Investec Bank.

18.

PART D - VELE INVESTMENTS AND ITS INVOLVEMENT (18-27)

VELE INVESTMENTS:

In 2015 I registered Vele Investments ("VELE") with the aim of consolidating all companies which were under my control at the time under one single holding entity. The interim shareholding structure of Vele was formalised; see copy thereof attached herewith, marked and annexed as TM-4.

18.1 VELE SHAREHOLDERS

18.1.1 EQUITY SHAREHOLDERS

Vele was 100% owned by Vele La Mbeu. The sole equity shareholder of Vele La Mbeu was King Toni Mphephu, with an equity shareholding of 100%; see attached herewith the share certificate, marked and annexed as TM-5. The King's shareholding was artificial and was meant for PR purposes as the equity shareholder had no voting rights.

18.1.2 PREFERENCE SHAREHOLDERS

Vele La Mbeu had two preference shareholders namely, Vencor and PM Trust. Vencor held 71,4% of convertible preferent shares in Vele La Mbeu, the balance of 28,6% was held by PM Trust for the benefit of Paul Makhavhu and the King. The two preference shareholder groups were the real shareholders of Vele La Mbeu and in turn Vele.

The type of shares were Convertible Preference Shares. Each shareholder could convert these Convertible Preference Shares to proportionate ordinary shares on certain conditions. Preference shareholders were entitled to rights normally associated with ordinary shares and could appoint directors based on their shareholding.

Preference shareholders were entitled to a monthly management fee which was agreed to by all parties and was amended from time to time. In effect this was a monthly salary for the ultimate beneficial owners of these shares. Most of the shareholders elected to receive this "salary" through their entities that held the preference shares to avoid detection, accountability and disclosure.

The payments that were described as salaries were actually corrupt benefits to the persons involved as they and/or their companies never rendered any service to Vele and/or its subsidiaries nor paid any value for their shareholdings. The preference shareholders are listed below with their respective shareholding percentage and ultimate owners:

a) Parallel owned 20% of Convertible Preference Shares in Vencor

resulting in ultimate effective shareholding in Vele of 14,28%; see copy of preference share certificate is attached herewith, marked and annexed as TM-6. The ultimate owner was Nesane.

Preference shares were used as a shareholding instrument for general secrecy and to disguise the actual owners of Vele as some of these actual owners were conflicted. Payments made from the Vele bank accounts and/or its subsidiaries to Parallel on behalf of Nesane were irregular and corrupt in nature as they were rewards for his participation in the broader VBS scheme. Neither Nesane nor Parallel rendered any services to Vele that would entitle them to any remuneration by Vele Investments.

The Convertible Preference Shares were never paid for by either parallel or Nesane. The total sum of all payments for salaries and related fees paid throughout the 2016 to 2018 years by Vele and its subsidiaries to Parallel was approximately R7, 450, 000. The salaries mentioned exclude any loans or facilities that Nesane/Parallel had with VBS as these were applied directly with the bank by himself.

b) Munyai Investments owned 20% of Convertible Preference Shares in Vencor resulting in ultimate effective shareholding in Vele of 14,28%; see copy of preference share certificate is attached herewith, marked and annexed as TM-7. The ultimate owner was Andile. Preference shares were used as a shareholding instrument for general secrecy and to disguise the actual owners of Vele as some of these actual owners were conflicted.

The total sum of all payments for salaries and related fees paid throughout the 2016 to 2018 years by Vele and its subsidiaries to Munyai Investments was approximately R23, 495, 000. Payments made from the Vele bank accounts and/or its subsidiaries to Munyai Investments on behalf of Andile were irregular and corrupt in nature as they were rewards for his participation in the broader VBS scheme. Neither Munyai Investments nor Andile rendered any services to Vele that would entitle them to any remuneration by Vele Investments.

The Convertible Preference Shares were never paid for by either Munyai Investments or Andile. The salaries mentioned exclude any loans or facilities that Andile/Munyai Investments had with VBS as these were applied directly with the bank by Andile and/or Munyai Investments.

c) Hekima Capital owned 20% of Convertible Preference shares in Vencor resulting in ultimate effective shareholding in Vele Investments of 14,28%; see copy of preference share certificate is attached herewith, marked and annexed as TM-8. The ultimate owner was Magula. Preference shares were used as a shareholding instrument for general secrecy and to disguise the actual owners of Vele as some of these actual owners were conflicted.

Magula was linked to two companies known as Hekima Capital and lnvestar Connect Holdings ("lnvestar"). Payments from the Vele bank accounts and/or its subsidiaries to Magula and Hekima Capital/lnvestar on behalf of Magula were irregular and corrupt in nature as they were rewards for his participation in the broader VBS scheme. Neither Magula nor Hekima Capital/lnvestar rendered any services to Vele Investments that would entitle them to any remuneration from Vele Investments.

The Convertible Preference Shares were never paid for by either Munyai Investments or Andile. The total sum of all payments for salaries and related fees paid by Vele and its subsidiaries throughout the 2016 to 2018 years to Magula was approximately R7, 000, 000. The salaries mentioned exclude any loans or facilities that Magula had with VBS as these were applied directly with the bank by himself and were not gratuities from Vele.

d) Le Veinqueur owned 20% of Convertible Preference Shares in Veneer resulting in ultimate effective shareholding in Vele of 14,28%; see copy of preference share certificate is attached herewith, marked and annexed as TM-9. The ultimate owner was Madzonga. Preference shares were used as a shareholding instrument to disguise the actual owners of Vele Investments as some of them were conflicted and for general secrecy.

The total sum of all payments for salaries and related fees paid throughout the 2016 to 2018 years to Madzonga was approximately R19, 547, 580. The salaries mentioned exclude any loans or facilities that Madzonga had with VBS as these were applied directly with the bank by himself.

e) Venmont Capital owned 20% of convertible preference shares in Vencor resulting in ultimate effective shareholding in Vele of 14,28%; see copy of preference share certificate is attached herewith, marked and annexed as TM-10. The ultimate owner Myself ("Matodzi"). I used the Preference shares as a shareholding instrument for general secrecy and to disguise the actual owner of Vele whereas I was one of those owners. I received what was perceived as salaries averaging R700, 000 per month NET. In other cases, I would still use any of Vele accounts to pay additional personal costs or needs.

18.2 PM TRUST AND KING'S BENEFITS

18.2.1 PM Trust owned 28,6% of the convertible preference shares in Vele La Mbeu. The trustee of PM Trust was Paul Makhavhu. The ultimate beneficiaries of the trust were Paul Makhavhu and the King. The Convertible Preference Shares were never paid for by PM Trust. The total sum of all payments for benefits and related fees paid throughout the 2016 to 2018 years by Vele and its subsidiaries to both Paul Makhavhu and the King were as follows:

o Paul Makhavhu - R7,3 million

o The King - R4,3 million

In addition, Makhavhu held several bank accounts, motor vehicle finance and mortgage loan facilities with VBS.

18.2.2 The King also held bank accounts at VBS in his name and several motor vehicle finance facilities. A house was bought on behalf of the King in Dainfern through a mortgage bond from VBS. The mortgage bond was approximately R7,5 million. Monthly installments were serviced by Vele or its entities.

After VBS curatorship an amount of around R55 million was received by Vele from Anglo African Finance. The amount was a reversal of the purchase transaction entered into earlier between Vele and Anglo African Finance. I was informed that from this receipt, the King ordered that his debts including mortgage loan with VBS be settled.

The total settlement amounted to R19,5 million paid to VBS. I was neither party to the decision for this transaction nor was I informed that there was that decision reached between the late Maanda Manyatshe (who was Vele executive Chair at the time, after my resignation), Madzonga, the King and Praise Ragimana to settle VBS.

18.2.3 The rest of the money paid salaries for the staff at Vele and its subsidiaries. As mentioned in paragraph 11.9.3 Madzonga paid R10 million to his attorneys (Tshivhase Attorneys) just to disguise the origins of the funds and to siphon the money from Vele bank accounts.

From that R10 million, Madzonga paid me an amount of approximately R2 million for my Vele unpaid salary and legal fees. The balance was then utilised by Madzonga when he invested in the media business and all that for his personal gain as that business had nothing to do with Vele.

18.2.4 Both the King and Makhavhu received irregular gratificationsfrom Vele which were paid monthly to their nominated bank accounts. In my capacity as the chairperson of the VBS board, I was subjected to undue pressure from both the King and Makhavhu to provide them with monthly gratifications.

They resorted to threats of orchestrating my removal from the chairmanship by threatening to collaborate with my adversaries. As a result of these persistent threats and coercion, I was compelled to comply with their demands and provide them with these irregular gratifications. For example, on the Dainfern house, the King demanded expensive renovations which costed more than R5 million which was paid from either Vele or its subsidiaries to different contractors.

18.2.5 The same pressure was applied on Vele where the King would buy expensive vehicles and expect Vele to carry the monthly instalments. The King was given a monthly stipend of about R300,000 of which he was expected to live within that. However, he would purchase more vehicles and expect Vele to foot the bill.

18.2.6 After the VBS curatorship, the King took about two (2) motor vehicles for his personal use and those vehicles are still in his possession. They are as follows:

• Mercedes Benz V-Class

• BMW 3 series

18.3 I acknowledge that the credit facilities, which were illicitly established through Vele Investments and its subsidiaries, as well as monies that went through my personal VBS accounts flowing from such created facilities, were primarily used to conceal the true sources of the received funds. These actions were undertaken for my personal benefit and that of certain family members, as detailed in this affidavit. I take full responsibility for these offenses.

19.

R250 MILLION FICTITIOUS LOAN TO PURCHASE INSURE GROUP

19.1 Around 2016, I was called by Andile to his office. He was with two gentlemen by the name Russel Chipoyera and Abel Nyathi, who were already known to me. These two gentlemen presented themselves as having a mandate to look for funding opportunities for a company called Insure Group Managers ("Insure"). 

They mentioned that Insure is a huge company that operates in the insurance premiums-collections market that want to develop a relationship with VBS. They handed us Insure profile and financial documents. Insure wanted VBS to grant it a loan of R250 million against its company assets. The request was quickly dismissed by Andile and myself as we both felt that VBS could not at the time afford such a huge loan.

19.2 Sometime again in 2016. I was at my office in Mmamiplo Petroleum ("Mmampilo") in Rivonia when I received a call from Andile that Russel and Nyathi were at his office with a different proposal to make. I immediately proceeded to meet with them at Andile's office. Indeed, Russel and Nyathi tabled a new proposal in terms of which Insure was open to selling 50,01% of its equity to VBS for a consideration of R250 million.

The proposal was agreed to subject VBS raising external funds for such an acquisition and due diligence. I immediately appointed Mazars Audit firm to perform valuation, financial and tax due diligence of Insure. The due diligence was completed and handed to me around August 2016. Later and after the due diligence phase, Andile and I held internal discussions between ourselves.

In these discussions we agreed that the purchaser of the shares in Insure would be Vele. Insure was notified of this development and it agreed to this change.

19.3 Around early 2017, another meeting was held in my office at Mmamiplo. The attendees were myself, Russel and Nyathi. The latter two still representing Insure. Due to prior parallel commitment Andile could not attend this meeting. Having considered the guarantee proposal and its terms I found it unacceptable, and I rejected it.

I later realised that what Insure was looking for was proof of funds from VBS to satisfy its clients that Insure has liquid funds to the value of R250 million. I then proposed that we could do the transaction on condition that the money from the purchase price be deposited into VBS bank account and that the funds must only be available or withdrawn by the seller after five years.

At the conclusion of the meeting, Russel and Nyathi indicated that they would inform us if Insure had accepted the offer with proposed changes and terms. I immediately called Truter and Phophi to my office and informed them of the potential deal and its terms.

We all agreed that the transaction was only doable if Insure was not going to make any cash withdrawals out of that R250 million for the agreed period of five years. Truter and Phophi were excited about the float that Insure would deposit into VBS on monthly basis as this was going to boost VBS liquidity.

19.4 After the above meeting Andile and I were notified telephonically by Russel and Nyathi that the proposed terms were accepted by Insure.

19.5 In the meeting held in my office around February 2017 and after Russel and Abe Nyathi had left, Truter, Phophi and I discussed how we would structure the transaction in the books of VBS.

After deliberations on the recording of the transaction in VBS books, the proposed accounting treatment was that a deposit of R250 million will be credited into the Insure account to be opened with VBS and which will be "locked" or "pledged" for a period five years so that, no withdrawals can be made during that period.

Due to the size of the R250 million pledge, which was beyond the authority of the CEO, we decided that it would be kept under wraps and not disclosed and would simply be quietly settled. We were not concerned as no outflows were planned for the R250 million until after the expiry of the five-year period.

19.6 Later Insure and Vele concluded the R250 million agreement. VBS credited the full R250 million into the Insure account which had been opened with VBS. Insure also opened a Business account with VBS into which Insure deposited its short-term deposits. These lnsure's short term deposits gave VBS a predictable and guaranteed cash cycle that was instrumental in the avoidance of the stokvel-runs during December periods or during periods of excessive cash withdrawals in VBS.

19.7 The R250 million payment for the purchase price was created by way of a pledge into the VBS banking system. There was no formal loan agreement signed between VBS and Vele for this purchase price that was fictitiously credited into Insure bank account held in VBS.

While the intention was to sign a contract of loan between Vele and VBS from the onset for the money created to purchase Insure, this however never materialised. Neither was this transaction disclosed in any credit reports nor presented to the board for approval. It was left as a fictitious pledge in the books of VBS.

19.8 Insure later negotiated and requested that R20 million be withdrawn from the R250 million account as initiation fees, and this was agreed to. At a later stage Truter and I realised that there was a further withdrawal from the pledged account of more than R50 million. I confronted Phophi about this withdrawal and Phophi indicated that Hannes had requested an advance from the Insure VBS pledge account. I expressed my unhappiness about this withdrawal, I left the matter at that. I further became aware that contrary to our agreement more withdrawals were being made by Insure.

19.9 Our failure to properly record this Insure transaction resulted in this R250 million amount being fictitiously created in the VBS banking system, resulting in an unreconciled cash of R250 million which did not exist.

19.10 The irregular creation of this R250 million within the bank's system was done with my full knowledge as I was party to the process of its creation. From this fictious R250 million account, withdrawals were made which led to significant losses to VBS which affected its depositors.

I knew then that these withdrawals were in fact theft in disguise since it was known to everyone involved that the R250 million never existed. As a chairperson of the board and person entrusted with fiduciary duty, I admit that I failed to protect the interest of the bank, depositors and all interested parties.

20.

THE "EAGLE CANYON LIST":

20.1 After the conclusion of contract with Insure, Insure became the largest subsidiary of Vele Investments with more than 15 major subsidiaries under its control. These were diversified subsidiaries ranging from mining assets, property and insurance amongst others.

20.2 Sometime after the conclusion of the Insure contract a meeting which was attended by different stakeholders. Present at that meeting was myself representing Vele, members of Summit Strategic Partners (represented by Mr Hannes Soll and Mr Warren Thompson, who were the lnsure's appointed transaction advisors} and representatives of Foxburg (represented by Mr Russel Chipoyera and Mr Abel Nyathi).

At this meeting it was indicated to me that there is an opportunity to dispose of a subsidiary of Insure called EBM and that Insure wanted Vele's approval to proceed with negotiations. EBM housed Zinc facilities, mine dumps and toxic dump assets which are situated around the Springs area in the East Rand.

The representatives of Summit and Foxburg also indicated that there was an interest in the market for the sale of EBM's Zinc processing facility and that the expected offer price was in the region of between R800 million to R1 billion.

20.3 The topic of EBM Zinc Facility disposal was not new to me as it was mentioned many times during lnsure's purchase negotiation. During the Vele /Insure initial negotiations there was an understanding that the EBM Zinc Facility would be disposed of as soon as a suitable buyer is found. At the meeting amongst the different stakeholders, it further indicated to me that there was a big local mining company interested and a Singapore entity which had partnered with a local mining company. By that time Foxburg was already a subsidiary of Vele. I gave the attendees my blessing for the sale to go ahead as I also needed funds at Vele for settlement of Vele's undisclosed loans and overdrafts that were opened at VBS by myself and Vele companies.

20.4 After the meeting I immediately notified Andile, Phophi and Truter of the news about the pending sale and expected windfall. To my understanding this sale would have resulted in Vele effectively receiving between R400 million to R500 million (which was the 50,01% share of Insure Group equity) share of proceeds from the disposal. Myself and Andile were very happy that the R250 million that was used to acquire Insure Group and which at the time remained unreported and unpaid in VBS books, could then be used to off-set the initial R250 million pledge.

20.5 Following the above events a meeting was held at Eagle Canyon clubhouse on 19 March 2017 where Andile, Truter, Phophi and I were to discuss the final list of Vele and related parties' overdrafts to be cleared. Andile cancelled at the last minute, and the meeting went ahead without him. The list of overdrafts to be settled was discussed and the final figures to be cleared were agreed to. At this meeting we also agreed that certain accounts on the list would be credited with fictitious investment amounts.

The rationale was that these companies were not to apply for any further overdrafts in VBS and that we will use these available balance figures instead. After agreeing on final amounts, I then suggested that the list should also include Truter and Phophi own overdrafts which they held at the time at VBS. Due to Truter not having an overdraft with VBS at that relevant time as far as I knew, I then suggested that Truter be given R 2 million as he did not have any overdraft to clear. The amount of R 2million was subsequently credited to a company called Shangri la, which was controlled by Truter.

20.6 The meeting also discussed how the clearing of the said overdrafts list would be accounted for in the books of VBS. To my recollection the overdrafts list came to around R262 million; see the copy of the "Eagle Canyon" list attached herewith, marked and annexed as TM-11. Following the finalisation of the overdraft list, I made a further suggestion that the overdrafts be cleared immediately before the EBM Zinc Facility sale was finalised.

The reason for my suggestion was that since the overdrafts on the list were creating reporting problems in terms of related party disclosure, thus causing a downward effect on Capital Adequacy Ratio ("CAR") given that these overdrafts were classified as high-risk loans compared to other loan types.

20.7 We also deliberated about the accounting treatment and relevant journals to be posted in the VBS books. We then resolved that the transaction would be recorded as a Suspense account which would be cleared on receipt of payment from the pending sale of the EBM Zinc Facility.

The further agreement was that the transactions would not be disclosed to the VBS board. We then agreed that for this purpose the term to be used as an inward reference would be the "VBS Absa ATM or VBS Absa settlement "deposits", the reason being that this reference choice should not create any suspicion from employees and from both auditors (PwC and KPMG).

20.8 The overdraft list which was agreed upon at the Eagle Canyon was acted upon on 29 and 30 March 2017 for the clearing of overdrafts.

20.9 Now, the pending sale of the EBM Zinc Facility never materialised despite our initial projected timeline of a three to six-month period. I later learned from Insure that the EBM Zinc Facility needed a further investment of around R160 million for upgrades before it could be sold at the targeted price.

To finance this further investment, Insure participated in a fund-raising initiative and an amount of R140 million was raised from a financial institution called Barack. This initiative did not involve Vele nor myself and I only learnt of this loan from Barack at a later stage which led me to realise that Insure kept this loan from Vele since it did not want Vele to be aware of its undisclosed liabilities which were not disclosed at the time of the due diligence.

20.10 The non fruition in the disposal of the EBM Zinc Facility was devastating to us both as individuals and VBS. After Insure was placed in liquidation, I learnt that the EBM Zinc Facility had hidden loans of more than R1,1 billion all along, meaning that even if the sale of the EBM Zinc Facility could have materialised, Vele would still not have been able to settle its obligations to VBS.

21.

THE "EAGLE CANYON SUPPLEMENTARY LIST" CREDITS:

21.1 At the "Eagle Canyon" meeting held at Eagle Canyon Clubhouse on 19 March 2017, after the approval of the list, further credits were approved. These future credits to selected companies on the list were meant for future transactions and to avoid raising further overdrafts with related companies, see copy of the "Eagle Canyon Supplementary List" attached herewith, marked, and annexed as TM-12. The amounts were not static and were credited throughout the 2017 and 2018 periods for various purposes such as rights issue settlement and purchases of companies like Mvunonala and Fairsure.

21.2 On 5 May 2017, amounts totaling R135 million were debited from VBS corporate suspense account and credited to Vele VBS account. These transactions were executed with my full knowledge and approval.

21.3 On 5 May 2017, amounts totaling R22 million were debited from VBS corporate suspense account and credited to my account namely: T Matodzi VBS account. These transactions were executed with my full knowledge and approval.

21.4 On 5 May 2017, amounts totaling R30 million were debited from VBS corporate suspense account and credited to Venmont Holdings VBS account. These transactions were executed with my full knowledge and approval.

21.5 On 31 August 2017, an amount of R80 million was processed from VBS corporate suspense account to Vele VBS account for the purpose of payment of the first rights issue as detailed in paragraph 23 below. This transaction was executed with my full knowledge and approval.

21.6 From 7 September to 4 December 2017, amounts totaling R740 million were debited from VBS corporate suspense account and credited to Vele VBS account. These transactions were executed with my full knowledge.

21.7 On 5 May 2017, amounts totaling R37 million were debited from VBS corporate suspense account and credited to Robvet VBS account. These transactions were executed with my full knowledge and approval.

21.8 From 7 August to 27 August 2017, amounts totaling R300 million were debited from VBS corporate suspense account and credited to Mvunonala FNB account. These transactions were executed with my full knowledge and approval.

21.9 From 26 September 2017 to 13 February 2018, amounts totaling R57 million were debited from VBS corporate suspense account and credited to Vele VBS account. These transactions were executed with my full knowledge.

21.10 Transactions on these lists were loaded by Truter and Phophi as and when the envisaged transaction was imminent.

22.

VELE TRANSACTIONS FOR VBS RIGHTS ISSUE:

The first formal letter I received after being appointed as the Chairman of VBS board was a letter from the SARB raising issues relating to the VBSs lack of long-term capitalisation plan; see the copy of that letter attached herewith, marked, and annexed as TM-13. I responded to this letter; see the copy of that response attached herewith, marked, and annexed as TM-14. In a nutshell in that first formal letter, SARB wanted VBS to come up with a capitalization plan that matches VBS's new growth strategy. In VBS capitalization strategy letter to SARB, we highlighted the plan to raise further capital from shareholders by way of a rights issue. To this end Vele participated in three rights issues as will be explained below herein.

22.1 FIRST RIGHTS ISSUE

22.1.1 Around 2015 VBS was growing at an unprecedented rate and within a year its assets had doubled. This growth rate placed a strain on VBS's Capital Adequacy Ratio ("CAR") which was hovering close to 11%. The minimum regulatory capital required in terms of Mutual Banks Act is 10%. On 28 April 2017 the board of VBS approved the first rights issue at ae meeting of the board held at VBS Corporate Offices in Rivonia.

22.1.2 Around July 2017 I discussed with Truter that Vele would like to buy VBS shares on the upcoming rights issue. I knew at that time that Vele was not a VBS shareholder and therefore would not had qualified to participate in the upcoming rights issue. I had a batch of VBS shares which were in my name which I had been buying from existing shareholders. One such batch was 5110 shares which had I bought earlier during August 2015 from the previous CFO of VBS, Mr Cilliers Vosloo.

I instructed Truter to transfer these shares into Vele's name and backdate the transaction date. The purpose for this instruction was for the system to reflect that Vele was an existing shareholder and therefore eligible to participate in the upcoming rights issue. Truter then transferred the 5110 shares into Vele's name and backdated the transaction date on the system to reflect that the shares had been transferred on an earlier date of 9 May 2016.

This enabled Vele to participate in the upcoming VBS rights issue. This resulted in Vele subscribing for R80 million of the shares which were paid for and allocated to Vele Investments. The method of payment used to purchase for the share subscription was from Vele's VBS account whose monies were transferred from the VBS suspense account.

22.2 SECOND RIGHTS ISSUE

22.2.1 A second rights issue was approved by the VBS board on 31 August 2017. This was due to the pressure on VBS emanating from SARB in relation to an earlier commitment by VBS to the capitalization plan. VBS' earlier commitment SARB was that VBS would achieve an internal minimum CAR of 15% by 31 March 2017. As with the first rights issue, Vele again subscribed and paid for the rights in the amount of R80 million. The method of payment was from Vele's VBS account whose monies were transferred from the VBS suspense account.

22.3 THIRD RIGHTS ISSUE

22.3.1 There was a special VBS board meeting that was held on 30 October 2017 in which a further rights issue was approved. Vele was prepared to subscribe for R150 million. I remember my discussions with Truter in the corridors at VBS offices in Rivonia. Where I instructed him to transfer the R150 million as subscription payment by Vele which he did. This third rights issue was meant to ensure that VBS balance sheet can grow to at least R1O billion without the need for further rights issue.

22.3.2 During this period, VBS was preparing for conversion into a commercial bank; see the copies of the conversion scheme attached hereto and marked as TM-15.

23.

At all relevant times materially hereto, I knew that the above-mentioned rights issue were irregular as they constituted a misrepresentation since they were created without any payment being effected. I state the above because in "paying" for these rights issues, Vele utilised funds that were created through fictitious suspense account deposits.

The total amount of R310 million "paid" for these three rights issues was therefore not paid-up capital as defined in the Mutual banks Act, thus exposing VBS to an unfunded suspense account of R310 million. These three rights issues were paid for by Vele using the same method as overdraft clearing, but this time the funds had already exceeded what we deemed as security.

The three rights issues resulted in R310 million being created and without payment by Vele and were therefore not paid­ up capital as defined by the Mutual Banks Act. These transactions disenfranchised and diluted the legitimate shareholders of VBS who had paid for their shares. The bank was therefore exposed to an unfunded suspense account of R310 million.

24.

VELE ACQUISITION OF MVUNONALA:

24.1 On or about August 2017, Andile informed me that there is an insurance company under curatorship and was for sale. He linked me with the relevant person at Mvunonala to take the matter further. At that time Vele strategy was to be a major financial services holding company encompassing banking, insurance, and asset management. Mvunonala had assets under management of R6 billion and annual premium collection income of R254 million. I immediately recognised the strategic fit of this business to the stability of the VBS given that some of the investments and premiums could be invested with VBS.

24.2 Through contacts I had established during my enquiries, I then contacted a certain Mr Bongani Mhlanga ("Mhlanga"). Mhlanga was the sole owner of Mvunonala Group of companies. The company was under curatorship at the time. When I met with Mhlanga, the purchase price in the amount of R300 million was agreed upon for the purchase of Mvunonala Group. The transaction was subject to approval by the then Curator of Mvunonala, Mr Juanito Peters. We then concluded the contract with Mhlanga, and Mr Juanito Peters was involved in the contract; see the copy of the agreement attached hereto and marked as TM-16. All payments made by Vele and/or its entities to Mhlanga were in settlement of the purchase price.

24.3 The same strategy of accounting was used for this transaction. The R300 million used to pay for Mvunonala acquisition was in the form of creating cash through VBS suspense account and crediting Vele's VBS account with that amount. This transaction was never reported nor approved by any committee of VBS or its board.

24.4 Once the Mvunonala transaction was finalised; Andile, Phophi and I agreed that a success fee for this transaction we will be paid to them. Phophi later requested that Truter be included too in this gratification. The final figures agreed upon were R23 million for Andile, R17 million for Phophi and R10 million for Truter. Everyone was paid their share except Truter whose R10 million share was held at Vele for Truter's benefit. Truter eventually did not get paid this amount.

25.

VELE ACQUISITION OF FAIRSURE:

25.1 Around August 2017 Raliom Razwinane and Russel Chipoyera informed me of existing shares available for acquisition in Fairsure Group. This was after the acquisition of Mvunonala Group. The acquisition of shares in Fairsure group would have complemented the business in the employee benefits and fund management portfolio of Vele.

Fairsure group had assets under management of R16 billion and it seemed to be aa total fit for Vele and VBS strategy as it would have resulted in a portion of its long-term funds being Invested with VBS. I developed interest in Fairsure Group shares. This to me paying a purchase price of R18 million from Vele's VBS account to Fairsure group. This, despite Fairsure group having sold me those shares for R45 million.

25.2 I know that a success fee was paid to Raliom and Russel for introducing the transaction to me.

26.

MALIBONGWE PETROLEUM:

26.1 Malibongwe Petroleum ("Malibongwe") was one of VBS clients. During 2017 I was introduced to its owner, Ms Nonkululeko Mabena, through her then boyfriend, Abe Nyathi. I attended many meetings with both Ms Nonkululeko Mabena and Abe Nyathi. Malibongwe and Vele Private Equity later entered into a share option agreement where Vele Private Equity was to acquire 70% shareholding in Malibongwe; see the copy of the agreement attached hereto and marked as TM-17.

26.2 The share option agreement was necessitated by an opportunity which arose where Malibongwe was to be used as the operating entity to execute a deal with Burgan Cape terminals, a subsidiary of Vitol, to lease vast oil storages in Cape Town Harbour. Malibongwe was to procure off- takers for the fuel in the storage.

The deal entailed Malibongwe obtaining a bank guarantee of R40 million, and Burgan Cape terminals wanted a guarantee from one of the top four banks in South Africa. A transfer of R40 million from Vele VBS account was made for purposes of the said guarantee into Malibongwe VBS account. The transaction and guarantees were never finalized upon Vele Private Equity becoming aware that Malibongwe was struggling to come up with credible off­ takers for the fuel.

26.3 The R40 million had already been credited into Malibongwe VBS account from Vele VBS account remained the property of Vele and not that of Malibongwe. A payment of R5 million which was made into Sgameka VBS account was transferred from Malibongwe's VBS account. This transaction was neither made nor initiated by Malibongwe but by myself.

27.

PAYMENTS TO SGAMEKA:

27.1 To my knowledge Sgameka is a company owned by Brian Shivambu, a brother to Floyd Shivambu ("Floyd") who is the deputy president of EFF. The company was provided to me by Floyd to make payments that I promised to the EFF.

I made this promise following the news which had broken in the media that VBS had granted former President Zuma a home loan for his Nkandla residence, negative publicity arose in the country. Particularly from those that were opposed to Zuma at the time. Amongst those was the EFF.

27.2 EFF had started a campaign of mentioning VBS in its political rallies through its president Julius Malema. As Chairman of VBS I then decided that Malema and EFF should be approached for VBS to explain its position and how the loan was granted. Gogoro, which was VBS PR consultants, arranged a meeting for me to meet with Julius at the EFF's penthouse in Sandton around April/May 2017. I went there alone. Present there at was Julius Malema, Floyd Shivambu and Marshall Dlamini. Marshall Dlamini did not participate in the meeting, and he was seated far from where the engagement took place.

27.3 I explained VBS' position and the fact that the EFF's negative commentary about VBS/Zuma transaction was damaging VBS reputation. Furthermore, I explained that as black brothers, the EFF's constituencies were VBS target market also. I further informed them that VBS was willing to offer a donation to the EFF. I then proposed that VBS can donate R5 million immediately once a bank account has been opened at VBS and R1 million per month to the EFF. I also made it clear that the amount could only be deposited into a VBS account, and that EFF should therefore open a bank account with VBS.

27.4 After I left this meeting, Floyd and I remained in contact. At some stage Floyd indicated that they have opened an account at VBS in the name of a company called Sgameka. A transfer of R5 million as promised was made on my instructions from Malibongwe to Sgameka on 8 June 2017. Subsequent payments were made to Sgameka VBS account every month and were paid from Vele or any of Vele's subsidiaries. Myself, Julius and Floyd understood that concept of donation to mean gratification hence Floyd and Julius did not provide me with EFF's own banking details for these "donations".

27.5 Further subsequent meetings were held between Julius, Floyd and Myself. The notable one was where Julius and Floyd informed me that they needed funding to renovate an EFF restaurant called Grand Azania in Soweto. I informed them of a VBS facility for such loans and referred them to David Nthlokwe, the then General Manager of Credit at VBS, to attend to this request. This loan application was made through Sgameka and was approved although I do not know the amount.

27.6 After VBS was placed under curatorship, I met Floyd and his younger brother Brian several times at Floyd's residence in Bryanston. This was the first time I met Brian. At one of the meetings Myself, Floyd and Brian agreed to regularise the R5 million plus R1 million monthly donations.

It was agreed amongst us that we draft a contract between Vele and Sgameka for consulting work in petroleum and storage facilities. The said contract which we backdated by agreement, was drafted by the Shivambu brothers. The signatories to that contract were myself representing Vele and Brian who was representing Sgameka; see copy thereof attached herewith, marked and annexed as TM-18.

28.

PART E - FINANCIAL RECORDS MANUPULATION AND FALSIFICATIONS (28-31)

SIGNING OF ANNUAL FINANCIAL STATEMENTS:

28.1 On 4 July 2017, in my capacity as the Chairperson of the VBS board, I signed-off VBS Annual Financial Statements for the year ending 31 March 2017. At the time of the signing-off of the directors' reports and any other representations I made, I was acutely aware of the gross irregularities and misstatements relating to items in the books of VBS amongst others. I knew that these gross irregularities would render the financial statements being signed-off to misrepresent the true state of affairs. The following are items in the books manipulated:

a) Cash and Cash Equivalents

With reference to paragraph 20 above, I was aware that the suspense account relevant hereto was created because the R250 million Insure pledge account remained unreconciled. Also, the R260 million that was created to clear the overdrafts from the "Eagle Canyon" list on 29 and 30 March 2017 remained unreconciled on 31 March 2017. I had a discussion with Truter, and we agreed that unreconciled suspense accounts will be classified as cash and cash equivalents in the balance sheet.

Truter and I also misrepresented the true state of affairs to the auditors. In his capacity as the audit partner Malaba agreed with us and stated that VBS will need at least 12 months to reconcile suspense account transactions. The suspense accounts were made up of irregularly created deposits which did not exist.

b) Loans and Advances

I assisted Truter as and when required. I would even assist him with advice and input during financial statements and audit preparations. I was never involved in the actual number crunching. I would however be acutely aware that creation of irregular suspense accounts described in "Cash and Cash Equivalents" resulted in corresponding material effect in loans and advances. This increased effect also represented a misstatement in financial statements of which I was aware.

c) Amounts Owed to Depositors

Also in this regard, I would assist Truter whenever he required my advice or input during financial statements and audit preparations. I was never involved in actual number crunching nor participated in the audit. I would however be acutely aware that the creation of irregular suspense accounts described in "Cash and Cash Equivalents" would result in a material increase in amounts owed to depositors.

d) Permanent interest-bearing shares

With reference to par 23.1.1 above (First rights issue), I was aware that Vele had irregularly subscribed for rights issue of R80 million. I was further aware that as on 31 March 2017 they were not yet paid for.

PROPOSAL WRITTEN TO PIC:

On 4 October 2017 I signed a letter addressed to the PIC in my capacity as Chairman of the VBS board. The recipients of the letter were Ms Brendah Mdluli who is the Associate Principal-Impact Investing at the PIC and Dr Dan was copied. The letter was informing her of the PIC need to take up its rights in VBS. In the said letter I confirmed that VBS had equity of approximately R150 million, which at the time I knew to be false. I also misrepresented on the financial statements that were attached on the said letter which I knew the figures were misstated.

30.

MANIPULATION OF THE PIC DRAWDOWN REQUESTS:

30.1 Sometime during 2016 I became aware that the drawdown requests were being manipulated by Truter and Andile. The method of manipulation would be for a drawdown addendum to be fictitiously created against an existing legitimate fuel facility client, without their knowledge.

This document would have a forged signature placed on it and as a result it would cause the amount on the manipulated addendum to be released by PIC to VBS. I came across a VBS employee by the name of Tshepiso McWazzer ("Tshepiso") preparing drawdown request addendums which were to be reviewed by Truter and then signed-off by Andile.

30.2 Tshepiso seemed to be struggling to balance the figures to the desired drawdown pre-set amount. I figured out the Andile had given Tshepiso a pre­ set amount as the target. I then decided to assist her by providing her Tlokaina and Leruo as additional entities for which forged signatures were to be placed on drawdown addendums so as to increase the drawdown amount. (Tlokaina and Leruo were existing VBS for the Fuel Finance Facility). I did not speak to either Truter or Andile about this, however I did observe that they signed the revised addendum, and they therefore knew that what they were doing was fraudulent.

30.3 I never assisted with this process again. However, I knew that this manipulation was continuing to increase VBS' liquidity position.

31.

FALSIFICATION OF MANAGEMENT ACCOUNTS - PIC:

31.1 Between February 2018 and March 2018, VBS was experiencing severe liquidity issues. VBS approached PIC to assist with its recapitalisation of the balance sheet. The PIC requested VBS' latest management accounts as at 31 January 2018. As the finance team struggled to finalise the financials, PIC started putting pressure on VBS for the financials.

At this time, I received a call while I was in Cape Town from Dr Dan Matjila (the then CEO of PIC) who was complaining about not being able to reach Andile. He further emphasized the urgency with which the management accounts were required. I tried to call Andile but was unsuccessful also. I then decided to assist Truter to complete the required management accounts.

I communicated with Truter via WhatsApp, and we made various adjustments to the financials which were mostly to project the desired financial situation rather than the actual state of affairs of VBS. Andile returned my call the next day and I briefed him of what Truter, and I had managed to accomplish the previous night. The financials were then sent to the PIC by Andile and Truter as the Executives responsible.

32.

INVOLVEMENT IN MONEY LAUNDERING AND RELATED OFFENCES:

32.1 I wish to address the issue of money laundering as far as it involved me. I acknowledge and admit that I knowingly participated in money laundering activities. Specifically, I assisted in concealing and disguising the payments of illegal proceeds of crime by transferring these funds from VBS into various accounts to obscure their true origin and the identities of the recipients.

32.2 In this regard I acted in concert with others, most of whom were equally aware that our actions were intended to facilitate and perpetuate these unlawful activities. I deeply regret my involvement in this illegal scheme and understand the gravity of my actions.

33. LYTTELTON POLICE STATION INCIDENT:

33.1 On or around 12 or 14 March 2018, I went to the Lyttelton Police Station in Pretoria at the invitation of my then lawyer, Mr Joseph Maluleke ("Maluleke") who to my knowledge is a practicing attorney. The purpose was for me to depose to an affidavit on behalf of Vele and issues relating to the curatorship of VBS. Present at the police station was Maluleke, Matsepe, myself and my then two bodyguard (Dan and Vusi). Maluleke then left in a hurry before we could all finish with the Affidavit.

33.2 About more or less ten minutes after Maluleke had left the Police Station and as I completed deposing to my affidavit, two men who were dressed in plain clothes approached me while I was still inside the police station. They identified themselves as members of the Hawks and informed me that they were there to arrest me regarding the VBS matter.

They showed me what to me appeared to be a charge sheet. I informed them that they should identify themselves with the Lyttelton police first before I could talk to them. They did so by presenting their police cards to the lady police officer who was behind the counter.

This lady police officer confirmed to me that the two men were indeed police officers. I then immediately called Maluleke and informed him of the situation. He drove back to the police station, and he started engaging with the said two officers. By this time, we were all outside the police station building by the parking lot.

33.3 I was however a bit suspicious of the two men and so was my two bodyguards who also conveyed their suspicions to me. Vusi informed the two men that he doubted that they were from the Hawks. I calmed Vusi down. In about thirty minutes, Danny also arrived driving a white BMW. He spoke to Maluleke and the two men, and the two men had a back and forth with Danny.

I was then informed that Danny was on the phone with their "supervisor'', which call lasted at least twenty minutes. After that "call" and confirmation by the two men, Maluleke and Danny then came to me and told me that those two men were indeed from the Hawks and agreed to release me to Maluleke until further notice. We then parted ways after having agreed that I would meet with Maluleke the next day in his Pretoria offices for a way forward.

33.4 The next day, I went to Maluleke's offices in Pretoria and found Matsepe there. Maluleke and Matsepe then informed me that Danny had gone to Silverton Hawks headquarters to meet with the Hawks' bosses for negotiations regarding the previous night-incident. After a few hours Danny arrived at Maluleke's offices.

In Maluleke and Matsepe's presence, Danny informed me that I needed to leave the country immediately for the time being until everything was sorted it out. I was then informed by Danny that he paid the Hawks bosses an amount of between R200, 000 and R300, 000 (I cannot recall the exact amount) and that the said amount will be included as part of Maluleke's bill.

Part of the agreement was that the legal bill will be settled from the proceeds of the sale of the Ferrari. The legal bill from Maluleke was around R700, 000. Maluleke suggested that I give him a Power of Attorney for him to act on my behalf and Vele's during the period of my absence and I agreed. From Maluleke's offices I ran a few errands and thereafter drove straight to the airport for my departure.

33.5 The reason I signed the Power of Attorney in favour of Maluleke was on his advice that it will assist in cession of Vele to himself and in him selling my personal motor vehicles and those belonging to Vele. I was subjected to untold pressure by Maluleke and his associates (Danny and Matsepe) whom I realised later, that their aim was to steal Vele and make profit from the sale of motor vehicles.

Furthermore, they misled me into leaving the country, whilst their intention was to control Vele Investments and strip it of its assets. This "Hawks" arrest was a pure sham intended to hijack and make undue profit out of disposal of my assets. Their undue pressure for me to leave the country caused me to drive to OR Tambo International Airport in haste and purchased the flight ticket, online at the airport, to London.

I departed for London on 14 March 2018, having arrived at the airport around 15H00 and all this happened whilst Matsepe was right next to me ensuring that without fail I left the country for their plans to materialise.

33.6 Whilst in London, I instructed Takalani Mmbi to give them all the files and whatever stuff they needed. I had four (4) motor vehicles which were registered under Vele and/or its subsidiaries, namely: Ferrari 488 Spider, Porsche 911 Carrera, Mercedes Benz Viano and Range Rover Lumma.

33.6.1 I had purchased my Farrari for R6,5 million for which Maluleke paid me R 1 million which I received from Matsepe. I later learned that Maluleke had sold the Ferrari for R5,5 million to a dealership.

33.6.2 I had purchased my Porsche for R1,4 million for which Maluleke paid me R300,000-00 which I received from Matsepe. I later learned that Maluleke had sold the Porsche for R650,000-00.

33.6.3 I had purchased my Mercedes Benz Viano for R1,030,000-00 and I did not receive any money from Maluleke from the proceeds of the sale of this motor vehicle.

33.6.4 I had purchased my Range Rover Lumma for R2,091,630-00 and I did not receive any money from Maluleke from the proceeds from the sale of this motor vehicle.

33.6.5 The payments were made into different accounts that I provided to Matsepe via WhatsApp messaging at the time. The accounts that I gave were not mine as I feared that my accounts could be frozen as the transfers happened during the curatorship period. The payments were made to the following bank accounts for my benefit

I. Alderwood trading 45cc, FNB account number 624 9923 1521-amount of R1,6 million (I am not sure if the full amount was paid. This was for payment of proceeds from Range rover and Ferrari sales

II. T Matodzi, FNB account number 6212 5444406 - my personal account number

33.7 After initial payments for Porsche and Ferrari, all further enquiries regarding the details regarding the sale of these motor vehicles were fruitless as I was sent from pillar to post.

33.8 I came to know that same tactic of the "Hawks" scare was also used on Andile. To this end Matsepe sent me a WhatsApp message on 15 March 2018 that Andile was approached by the Hawks. I never discussed this incident with Andile. My suspicion is that it was under the same modus operandi that was used on me.

33.9 After realising that the actions by Maluleke and associates were a tactic to take over Vele and sell my assets whilst I had been ordered to leave the country, I then decided to fly back into the country and revoked the Power of Attorney and then took back control of Vele.

34.

RMB TREASURY BOND INCIDENT-MEETING WITH RMB AND THE SARB

34.1 Around June 2017 VBS failed to honour a treasury bond settlement to RMB to the value of _:tR200 million. VBS had an overnight credit facility with RMB where RMB would buy treasury bills on behalf of VBS and VBS would then settle the full amount of the bonds purchased the next day.

On 20 June 2017, I received messages from both Truter and Phophi that RMB bonds facility was overdue and that RMB was threatening to escalate the matter internally and to the SARB. A meeting was arranged between RMB responsible personnel and Myself, Truter, Phophi and Andile.

Andile joined the meeting by teleconference. RMB was concerned that VBS' failure to settle the bond timeously indicated that the bank was experiencing liquidity crisis. RMB assertion was correct but was refuted by us (VBS representatives) at the time. At the meeting myself and Andile alluded that the settlement failure was due to a system limit issue which required VBS technicians to resolve before payment could be made to RMB.

The fact was that VBS had to settle Insure earlier and used bonds purchased by RMB as security to draw a loan from SARB reserves. A second meeting was held on the same day, which I did not attend. The report I received from Truter and Phophi was that RMB was still not satisfied and had escalated the matter formally to the SARB. The amount was settled on 23 June 2017. By the time the settlement to RMB occurred, the matter was already escalated to the SARB by RMB.

34.2 At a later date a meeting was held with the SARB regarding the above matter. This was due to the escalation that was made by RMB. At the meeting at SARB offices in Pretoria where VBS was represented by myself, Andile and Truter and the SARB was represented by Kuben Naidoo (who was the then SARB Deputy Governor) and his team.

At this meeting I emphasised that the liquidity issue that VBS experienced was due to system automatically releasing an investment that was not yet matured and the issue had been resolved. This was not the case and was simply a misrepresentation of the facts that indeed VBS failed to settle on the day and treasury bonds were in fact bought with the purpose to settle Insure maturity.

35.

SETLAFUSION

Setlafusion was a company managed by Maluleke on behalf of Dr Alvaro Sobrinho ("Dr Sobrinho"). Dr Sobrinho is an Angolan former banker who wanted to establish a presence in South Africa. I was introduced to Dr Sobrihno by Danny and Maluleke sometime during 2017. Initially Dr Sobrihno wanted to become a VBS shareholder and of which I indicated to him that such will not be possible.

We then commenced with negotiations for Dr Sobrinho to buy shares from Vele. In show of good faith, he promised to invest an amount of US$10 million into VBS. An investment of around R140 million was made to VBS through Setlafusion around 2017. No agreements between Dr Sobrihno and Vele were concluded. The said amount was never withdrawn from VBS until the date of curatorship.

36.

BRILLIANTEL

I was the CFO and co-founder of Brilliantel together with Maanda Phalanndwa. The company operates in the ICT space with specialisation in telecommunications. Brilliantel was part of the Dyambeu consortium and primary funder alongside Promafco. During 2015 while I was involved in VBS operational review I noticed that VBS technology and telecommunications were outdated.

I recommended to offer Brilliantel services at cost to alleviate the situation. Through my intervention at VBS, Brilliantel was then appointed to install telecommunication systems at branches. Brilliantel decided to terminate the service to avoid reputational damage and conflict of interest.

Brilliantel had several facilities with VBS including overdraft facilities, contract finance, vehicle finance and a mortgage bond under an entity called Maita Zwi Toma Trust. All facilities granted by VBS to Brilliantel were at arm's length. Brilliantel serviced its facilities from its own funds. I exited Brilliantel around 2016 as a shareholder and CFO. I had no relationship with the company afterwards. Brilliantel was not involved in VBS corrupt activities.

37.

PRASA

PRASA investment opportunity was organised by various persons within VBS and commission agents. The first team was led by Andile and Gift Manyaga. This team led their own process of which I was not intimately involved. I recall around February 2018 that there were messages that this team managed to obtain an investment of R1 billion from PRASA, but the money was never deposited to VBS. There were mention that payments of around R1,5 million was made by this team to PRASA officials, I do not know the details of this payment.

There were various media reports about this investment, and I was involved with VBS PR team to issue a media statement on behalf of VBS and communications to the board. The second team was that of Matsepe who also had connections within PRASA. Matsepe organised a meeting between Mr Cromet Molepo ("Cromet") who was the CEO or COO of PRASA and myself. The meeting occurred at my residence in Eagle Canyon on 19 January 2018.

At this meeting Cromet promised PRASA to invest at least R5 billion in VBS in return for a R50 million gratification which was to be transferred to a foreign bank in Canada. No banking details were provided at the meeting or subsequent thereto. At the conclusion of the meeting, he then requested that I write to PRASA regarding the VBS investment proposal.

I wrote a letter and sent it to him. I do not recall any further engagements with Cromet after our meeting as the relationship was being handled by Matsepe. The promised investment did not materialise, and no gratifications were paid.

38.

DR ZWELI MKHIZE

Around 2016 a meeting was arranged to meet with Dr Zweli Mkhize (11Dr Mkhize"), who at the time was the Treasurer-General of the ANC. The meeting was held at Mmampilo boardroom in Rivonia. Present was Dr Mkhize, Andile, myself and I think there were other members in the meeting who I cannot recall (I think a guy by the name of Nkadimeng).

The meeting was probably arranged by Joesph Nkadimeng. The purpose of the meeting was to ask for Dr Mkhize to assist VBS with accessing much larger facilities at PIC. I recall an amount of R2 million which was paid via Joseph Nkadimeng orTseke Nkadimeng which was requested by Dr Mkhize. The request was that the payment was for an ANC supplier. No further engagements were held with Dr Mkhize after this meeting.

39.

SACP

After the news that VBS had granted the former president Zuma the loan, SACP published a statement through its Gauteng chairperson at the time Mr Jacob Mamabolo ("Mamabolo"). The story was alleging that VBS was doing business with Gupta linked entities called Vardospan and Habib bank.

I then instructed Gogoro communications to obtain contacts for the relevant SACP individuals. A meeting was arranged by Gogoro for a meeting with SACP Gauteng team headed by Mr Jacob Mamabolo and VBS team led by Andile. I did not attend this meeting. Another meeting was later arranged between Mamabolo and I at a Boutique Hotel in Groenkloof, Pretoria.

The meeting was a follow up on the meeting held with Andile's team and how the relationship between VBS and SACP could be improved. Another meeting was held between Myself and Mamabolo at Palazzo Hotel in Fourways. At this meeting discussions were general in nature and Mamabolo wanted to know more about VBS and how members of SACP could be approached to bank with VBS.

Around July 2017 I received a call from Mamabolo seeking assistance with settlement of SACP conference bill of R3 million at Birchwood Hotel in Kempton Park. On 6 July 2017, the said amount was paid directly to Birchwood Hotel from MML Food Services. There were no further requests received from the SACP regarding payments.

40.

BLACKOPS

Around 2017 the idea of boosting VBS profits through artificial means was conceptualised. This concept was initiated by myself, Phophi and Andile. We then came up with the name black ops for the project. The concept was around creation of fictitious entities for suppliers and customers with VBS providing the funding between the two.

VBS would then charge excessive initiation fees, interest and profit share. The concept gained traction and around September 2017 it was formalised. I was only involved in the conceptualisation and did not participate in its daily operations. I was however on WhatsApp group that was created. Phophi operated as the administrator of the project assisted by Tshepiso.

Other members were Bruce Mothoagae from Tiisang, Russel and Abe Nyathi. I have no knowledge if the black ops were finally operationalised to the point that fictitious profits were booked into VBS systems.

41.

R5 MILLION CASH HANDED TO "PIC"

Around early 2017 I had conversations regarding the request by Nesane to take care of certain influential people within PIC for VBS benefit. The conversations centered around paying off people who have been supportive of VBS and those that will be needed in future as VBS wanted to raise more capital with the PIC to fund its growth. PIC was also failing to release drawdown requests to VBS and the reasons for delays were difficult to understand. Nesane alluded to this delay on the need to settle internal people at PIC.

At the time he affirmed to me several times that Dr Dan was also one of the intended recipients. Due to our unwritten Chinese wall principle, I trusted Nesane and did not demand to know the actual recipients on the PIC side. We agreed on an amount of R5 million. Around April 2017 I instructed Phophi to make arrangements for the cash amount. On the day of the cash collection, I arranged the Vele chopper to pick Phophi up from Makhado to Lanseria Airport. This was for security reasons due to the large amount involved.

I met Phophi on 8 April 2017 at Lanseria Airport and took possession of the cash. I kept the bag overnight inside my car and delivered the cash to Nesane the next day. We met with Nesane on 9 April 2017 at Engen garage in Groenkloof, Pretoria.

The cash was exchanged still in the original bag, and we both left. Nesane was driving a grey BMW X5. A few days after the cash delivery the payment for fuel drawdown was paid. The balance of larger facilities promised by Nesane for VBS never materialised.

42.

I know and understand the contents of this statement.

I have no objections to the taking of the prescribed oath.

I consider the prescribed oath to be binding on my conscience.

Signed

TSHIFHIWA MATODZI

Pretoria, 10 July 2024