This was revealed earlier this week as the Corporation’s Chief Executive Officer, Ikhraam Osman, together with a delegation from the Free State Department of Economic, Small business development, Tourism and Environmental Affairs (Destea) appeared before the provincial legislature’s Public Accounts Committee (Propac). The corporation made news in October last year when it was listed as one of the top three beneficiaries from the bank in a report titled “The Great Bank Heist”, which detailed how municipalities, companies and individuals allegedly looted close to R2 million from the bank. The provincial department is uncertain on whether or not it will receive the remainder of the investment.

As the Department of Economic, Small business development, Tourism and Environmental Affairs (Destea) responded to questions posed by members of legislature based on an earlier presentation, the department revealed that it was now waiting to hear from the liquidators of the bank. Feedback from the liquidators would guide the department on the process to be followed with regards to attempts to recover the outstanding monies as well as whether or not these monies can actually be recovered.

In October last year the corporation told OFM News that, during its 2017/18 financial year, it made an initial investment of R100 million. Following which the chairperson of the FDC Board, Hantsie Matseke, said that the return on investment was R4,5 million and the money was paid back in four payments of about R30 million, two separate R10 million payments and one final payment of about R54 million which totalled R104 million. Matseke said it was unfortunate that Advocate Terry Motau’s report, titled the ‘Great Bank Heist’, only reflected the R104 million under question as an incoming amount and did not also show that it was an outgoing amount as an investment. The bank, which had been under curatorship as per the instructions of the finance minister on 10 March 2018, was finally placed under liquidation in November later that year after the South African Reserve Bank’s Prudential Authority applied for the final liquidation of the mutual bank. In its affidavit to the North Gauteng High Court, the authority stated that it was in the best interests of the bank’s creditors and members of the public to liquidate the bank as it was “hopelessly insolvent”. This, however, comes despite numerous calls, by government and some political parties, that the bank be saved. Meanwhile, a provisional liquidator has been appointed and creditors with enquiries or justified claims against the bank may be sent to the liquidator at an email address specified on the bank’s website. “…we are still in the early stages of the liquidation process and are unsure as to how long the process will take. Please be assured that we are pursuing every legal avenue available to us to recover the assets of the bank to your benefit,” the liquidator, who remains unnamed at this stage, said on the website. Once the liquidator eventually recovers the assets and pays the creditors what is due to them by selling off the assets of the bank, then paying off its liabilities, the bank will finally then be liquidated.

OFM News