Golden handshake for former MM of Collins Chabane

By Kaizer Nengovhela and Anton van Zyl

Confirmation was received the past week that the former municipal manager of the Collins Chabane Municipality had indeed received a “golden handshake” after being suspended for her involvement in the VBS Mutual Bank saga.

The mayor of the municipality, Cllr Moses Maluleke, confirmed that a four-month parting salary was offered to Tsakani Charlotte Ngobeni. The value of the package is believed to be between R500 000 and R600 000.

Ngobeni was arrested last month and appeared in the Palm Ridge Magistrate’s Court on charges of corruption and contravention of the Municipal Financial Management Act (MFMA). She appeared alongside seven co-accused in the Specialised Commercial Crimes Court in connection with the looting of VBS Mutual Bank. Her co-accused include ANC Limpopo leader Danny Msiza, ANC-linked “businessman” Kabelo Matsepe and the former COO of the mutual bank, Robert Madzonga. Ngobeni was granted bail of R50 000 and she must be back in court on 6 May. 

Ngobeni signed off on a R120 million investment with VBS on 21 October 2017. The State alleges that, in return, Ngobeni had received kickbacks from people accused of being part of a racketeering enterprise, whose aim had been to swindle VBS Mutual Bank.

The representatives of the Economic Freedom Front in the Collins Chabane municipality condemned the action of paying money to the former MM. An Exco member, Cllr Dunani Baloyi, said that his party would write to the MEC for Co-operative Governance, Basikopo Makamu, asking him to consider taking disciplinary action against the people who had authorised the payment of the “golden handshake” to the former MM.

He said that EFF was deeply concerned that the municipality continued to waste the taxpayers’ money by enriching their cadres because of a lack of political leadership and consequence management. “We feel that the municipality was wasting money by paying two managers and also paying legal fees regarding the MM issues,” he said. 

But is she the only one?

Ngobeni may be the one facing the music now, but documents and reports filed as part of court proceedings indicate that she was not the only one making decisions at the time. Despite promises by the province’s premier in December 2018 that decisive action would be taken against the individuals implicated, not much has happened.

A forensic report commissioned by the province’s treasury department showed up numerous irregularities in the way the officials as well as the political office bearers had handled the VBS investment. Regulations were flouted and people who were appointed to perform an oversight role conveniently looked the other way.

The mayor at the time, Joyce Bila, denied that she had given consent for the R120 million investment. She said that the responsibility had been delegated to the MM and the chief financial officer (CFO) and she had trusted them to do their jobs. Bila was sacked as mayor in December 2018. She is currently an ordinary councillor.

The CFO at the time when the investment was made, was Eadie Makamu. He admitted that no background checks were done after the proposal that the money be invested at VBS was made. He also did not ensure that the necessary credit checks were done. He seemingly also did not know that investing in a mutual bank was illegal.

An interesting fact that came out in the reports is that the MM had signed off on the investment while she was in hospital. Makamu could not explain how this was done.

Ngobeni stated that the proposal to invest with VBS had been made by the municipality’s former CFO, Mr M Maite, along with Makamu. At that stage, Maite had been seconded to the municipality to assist the new CFO.

On 18 September 2017, Makamu forwarded a recommendation to Ngobeni in which approval was sought for two short-term investments, one being at VBS. She approved the proposal a day later.

Another interesting aspect that came out of the reports is that VBS had already thanked the municipality for the investment on 15 September 2017, four days before the recommendation was approved.

The municipality had invested R120 million with VBS at an interest rate of 8,1%. When the term matured on 23 January 2018, the municipality tried to get the funds back, but to no avail. At that stage, the bank was already cash-strapped, and all that Ngobeni and the other officials received were empty promises.

Makamu is no longer at the Collins Chabane municipality, but it could not be established whether he resigned or were forced to leave.

News - Date: 10 April 2021

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