COSATU appeals to the Minister of Justice and Constitutional Development to come clean amidst VBS allegations

5 September 2024

The Congress of South African Trade Unions (COSATU) expects the Minister of Justice and Constitutional Development Thembi Simelane to do the right thing and give a full account of her involvement in the demise of the now debunked VBS Mutual bank when she appears before Parliament this week.

The Minister made headlines for the wrong and painful reasons recently when she was said to have received around R575,600 from the bank to purchase a coffee shop in Sandton, Johannesburg while she was Mayor of Polokwane Municipality in Limpopo.

According to media reports, the funds used to acquire the coffee shop were kickbacks granted to Simelane from Gundo Wealth Solutions, for the R349-million invested by the Polokwane Municipality in the mutual bank. At the time, Gundo Wealth Solutions brokered investments on behalf of VBS Mutual Bank. Simelane has since described the payments as a commercial loan.

As she heads to the Justice Portfolio Committee in Parliament, the Federation trusts that she will act morally and provide explanations of the transactions, especially considering the office she holds.

This is a matter that cannot be taken lightly or dismissed with obfuscation, deflection or platitudes.  Thousands of depositors lost their savings are still reeling after their monies were stolen when the bank collapsed and declared bankrupt in 2018, their justice remains denied.   Two SAMWU shop stewards and an ANC Councillor were assassinated in Vhembe for blowing the whistle.  Millions of municipal funds were lost by municipalities who today struggle to pay their staff and provide services to communities.

Society bears the devastating scars of state capture and corruption.  The public has the right to expect its public representatives to hold themselves with integrity and to be accountable.

It would be a further injustice to underplay the seriousness and severity of these allegations. The portfolio the minister occupies cannot afford to be compromised given she supervises the National Prosecuting Authority (NPA), which is investigating and prosecuting those involved in the collapse of VBS. Her participation in the Justice and Crime Prevention Cluster in the Cabinet also risks being tainted with a possible conflict of interest.

Minister Simelane needs to be transparent with the public.  If it was indeed a loan, proof of this loan, including repayments needs to be provided.  If it was a loan then the Minister needs to provide proof that this was disclosed to the Polokwane Municipality and Parliament as required for a public representative. 

Even if confirmation can be provided that it was a loan, red flags are raised for what would have been at best a massive conflict of interest for a Mayor to receive monies, for whatever purpose, from a person doing business with and benefiting from the Municipality.  The Minister needs to provide evidence that she disclosed this massive conflict of interest to the Council and recused herself from all discussions involving the VBS matter. 

COSATU applauds our ally. the African National Congress (ANC) as well as President Cyril Ramaphosa for their swift response in calling on Minister Simelane to explain involvement with VBS. The immediate action lends confidence and affirms the ANC’s commitment to fighting corruption.

In this era of renewal and the collective quest to move the country forward, it is the minister’s moral obligation to truthfully account for her possible involvement in this matter.

Whilst we await the Minister’s taking the nation into confidence, questions must be asked on what exactly is the National Prosecuting Authority doing?  How long exactly does the NPA require to read and most importantly act upon the Zondo Commission into State Capture and Corruption?  Hundreds of millions of Rands were spent on the Commission.  Years have passed yet little sign of life or movement is seen emanating from the NPA.  If the NPA requires prosecutors, can that be stated and Treasury provide them the funds they require.  If the leadership of the NPA lacks the will or interest in prosecuting persons accused of serious instances of corruption, then they need to step aside and make way for those with the courage to do so.  What we cannot continue to tolerate is a culture of impunity and no consequences.

Issued by Zanele Sabela, National Spokesperson, COSATU, 5 September 2024