Former VBS CEO Andile Ramavhunga says he will launch a Constitutional Court bid challenging the Financial Sector Regulation Act, which Advocate Terry Motau relied on in his report on the failure of the mutual bank. The ‘Great Bank Heist’ report found that R1.9bn had been looted from the mutual bank, implicating him along with at least 50 other individuals.
Ramavhunga’s lawyer Mariq van der Westhuizen told a disciplinary committee of South African Institute of Chartered Accountants’s (Saica) on Thursday that the papers will be filed before the end of the year, or in early 2019.
Ramavhunga and former VBS and Vele Investments chairperson Tshifhiwa Matodzi face being struck off the CA (SA) roll over sequestration orders against them as VBS curator Anoosh Rooplal attempts to recover assets from the bank’s bosses.
Van Der Westhuizen requested a postponement from Saica until late March 2019 as the events relating to the provisional sequestration order are contained in Motau’s report, commissioned by the SA Reserve Bank.
The report found that Ramavhunga said he authorised the payment of R1.5m to the ‘Dudu Myeni Foundation’ in order to secure a R1bn deposit from the Passenger Rail Agency of South Africa (Prasa).
No foundation with this name existed and the Motau report alleges that could have been a reference to former President Jacob Zuma’s own foundation, chaired by Myeni.
Matodzi final sequestration
It also emerged at the Saica disciplinary hearing on Thursday that Matodzi has been placed under final sequestration by the South Gauteng High court. This is according to correspondence between his lawyer Hechter Hansen and Saica’s legal team. He was placed under provisional sequestration in July while Ramavhunga remains under provisional sequestration.
According to a Saica by-law, members can lose their CA (SA) status if they have been provisionally or finally sequestrated. This ruling is subject to the discretion of the disciplinary committee.
Sequestration is a legal act which allows creditors or the state to seize or remove assets.
The two former execs were not present at the hearings on November 9, and the committee chairperson was concerned that not enough had been done to contact and inform them of the disciplinary proceedings against them.
Saica’s legal team went to the South Gauteng High Court on November 26 when the pair faced applications to be placed under final sequestration, to serve them with notices of the disciplinary action on Thursday. Advertisements were also placed in newspapers.
Matodzi’s hearing will take place early next year while Ramavhunga’s date has been postponed until March 25 to allow for Constitutional court proceedings to unfold.
They both have 15 business days prior to submit support documents to the disciplinary committee.