VBS Mutual Bank was a bank for the poor — insiders stole R1.9 billion and destroyed it

VBS Mutual Bank was a small mutual bank founded in 1982, serving low-income communities in South Africa’s Limpopo province. It focused on providing banking services to the poor, including stokvels (community savings groups) and funeral societies. The bank was small but trusted, and had grown to hold deposits from municipalities and local communities.

In October 2018, an investigation by the South African Reserve Bank revealed that VBS had been systematically looted by its own executives. Between March 2015 and June 2018, R1.9 billion was transferred to 53 individuals. The bank’s chairman Tshifhiwa Matodzi, CEO Andile Ramavhunga, and CFO Philip Truter were arrested and charged with fraud, theft, and corruption. The heist was described as the “heist of the century” in South Africa.

The bank was placed under curatorship on 11 March 2018 and liquidated in November 2018. The collapse devastated poor communities who lost their life savings. Municipalities had deposited R1.57 billion in the bank, which the government refused to bail out. The scandal implicated politicians including former president Jacob Zuma, who had taken a R7.8 million loan from VBS. Matodzi was sentenced to 15 years in prison in 2024.