The Great VBS Heist: How the Shivambu brothers benefited even more

Because frontman Brian Shivambu did not qualify for the R4-million VBS Mutual Bank business loan, he ceded, with the help of VBS bank managers, an “investment account” containing an allegedly fictitious R4-million to the bank against which he could borrow. If intent to fleece the bank is proven, this will amount to fraud.

The loan was further never serviced. These schemes make the Shivambu loan a quintessential example of how “business” at VBS Mutual Bank was conducted, and why the bank imploded.

This R4-million loan, granted to the slush fund Sgameka Projects, was not detailed in the Motau/Werksmans-report investigating the bank robbery. An analysis of loan documents, emails and bank statements seized from the bank, as well as information from impeccable sources, form the basis of this Scorpio investigation.

The Shivambu brothers deny any wrongdoing.

Getting Stellenbosch on board

In around 2017, deputy president of the EFF Floyd Shivambu approached several businessmen – including individuals whom he often scornfully referred to in public as “the Stellenbosch Mafia” – regarding personal business ventures he had his eyes set on.

EFF MP Marshall Dlamini accompanied Floyd Shivambu to some of these repeated meetings with some of South Africa’s highest net-worth businessmen, confirmed four businessmen with personal knowledge of discussions with Shivambu. (Dlamini assaulted a police officer outside Parliament in March.)

One of these ventures pitched by Floyd Shivambu was a wine bar and restaurant to be built in the historical Vilakazi street in Orlando West, Soweto. It was to be called “Grand Azania”, and Shivambu was shopping around for a sponsor and a wine farmer who’d allow him to bottle their wine “under his own brand, Grand Azania”, sources recalled of the discussions.

Grand Azania is also the name of a company which received R6.16-million in illegal VBS money and of which Shivambu’s younger brother, Brian, is the sole director and bank account signatory (more about this later).

That Floyd Shivambu privately associated himself back then with “Grand Azania”, and described it as “his own brand”, is important: When questioned by Scorpio after VBS imploded, the deputy president of the EFF tried his best to disassociate himself from the brand and the company. Brian also denied that his brother had – at the very least – close ties with Grand Azania. (Read more proof about Floyd Shivambu's links to Grand Azania later in this article.)

Grand Azania and the R4-million VBS business loan

On 22 December 2017, Brian, the frontman for illegal VBS money flowing towards his brother, Julius Malema and the EFF, signed a really good deal with VBS Mutual Bank.

VBS bank’s credit manager David Nthlokwe granted Brian's slush fund Sgameka Projects a R4-million business loan to be repaid over 24 months at an interest rate of prime plus 300 basis points per annum. (Sgameka is under deregistration process, CIPC documents accessed on 1 April shows.)

It translated into monthly instalments of about R190,000, the loan contract states. It is an unsustainable ask of any small to medium startup in its first two years, especially because most startups only enter a positive cash flow only after at least three years, an industry specialist confirmed.

VBS bank’s system, as well as Sgameka’s bank statements, indicate however that Brian never serviced the loan. Scorpio confirmed this from sources and bank statements.

Brian conceded to this fact when questioned by Scorpio. He did however not mention that Grand Azania received any money from VBS. Said Brian:

“I own Grand Azania and applied for a loan of R4-million to build a restaurant business and never received the entirety of the money. The loan amount Grand Azania applied for was paid directly to service providers and suppliers of restaurant equipment, all of which was delivered to the promises (sic). All the loan amount was paid into the business. Due to the fact that the loan amount was not paid in full and my business was out in strain, progression of the project was delayed.”

(At this point, dear reader, you have every reason to be confused by this reply from Brian. The loan amount of R4-million was not applied for by Grand Azania, as he states in his reply, but was rather applied for by Sgameka Projects. Sgameka Projects sent formal letters to VBS asking for the funds to be advanced directly to Grand Azania and Architects Studio Plus. VBS would then advance the requested sums and pay it directly into the bank accounts of Grand Azania and Architects Studio Plus. Brian’s confusion may relate to how hard it is to focus on the facts when there are so many fictitious stories to juggle.)

In the true spirit of how “business” was being conducted at VBS, as found by adv. Terry Motau and Werksmans, there were also no repercussions towards this delinquent client as meted out to other law-abiding citizens. This despite a clause in the loan agreement (signed by Brian and Nthlokwe) stating that the bank may “claim damages” or “claim specific performance” after a material breach and failure to remedy the breach in five working days.

Further to the above are the circumstances under which VBS allowed Brian to borrow the R4-million, also highly questionable.

Brian and Sgameka did not qualify for the R4-million loan, documents Scorpio has seen suggest. By September 2017, Sgameka had already borrowed R1.46-million for a house the Shivambus’ parents lived in after Floyd used his influence with VBS CEO and robber-in-chief, Tshifiwa Matodzi.

To circumvent this problem, Brian (on behalf of Sgameka) ceded an investment account professedly containing R4-million to VBS bank in order to borrow against it.

Except, sources could find no trace of the R4-million.

The investment account seemingly exists, but neither Sgameka nor any other entity has paid the promised R4-million into the investment account, bank statements show and sources close to the investigation claim.

This may well amount to fraud, consumer lawyer Stephen Logan said.

Said Logan:

“If the Sgameka investment account exists but the investment money was never in place or planned to be deposited there, one would reasonably infer the investment security being offered to be fraudulent. Likewise, if the money was never expected by VBS to be deposited, it would likely constitute fraud by VBS. In either case, the intent to defraud must be properly proven. Should the evidence reflect an intent to use a fictitious investment account with no funds as collateral, VBS, Sgameka and Brian may be liable to criminal prosecution for various crimes.”

The paperwork, however, keeps up appearances. Brian has signed a:

• “Resolutions of the company” – a one-page document stating that Sgameka enters into a loan agreement with VBS and that the company pledge an investment account with a professed R4-million held at VBS in favour of the bank;

• “Loan agreement” with VBS – a 16-page document stating the amount borrowed and stipulating the terms and conditions;


• “Pledge and cession of investment account and claims” – a 21-page undertaking to cede R4-million professedly contained in an investment account held at VBS to the bank in order to borrow against this sum;


• “Suretyship undertaking” – a four-page document where Brian undertakes to “bind myself to the Creditor (VBS) as surety for and co-principal debtor jointly and severally with Sgameka Projects...”

1. Floyd linked himself to Grand Azania in 2017 when he tried to entice affluent businessmen to allow him to bottle their wine under “his own brand, Grand Azania”;


2. Another businessman showed Scorpio an email sent from Floyd’s private Gmail account in late 2017, asking if his rent had been paid by Grand Azania;


3. Dodgy PIC money was paid into Grand Azania’s account by a businessman, allegedly at the behest of Floyd, Sabelo Skiti and Thanduxolo Jika of Mail & Guardian found.

• Just over R1.1-million in VBS funds was paid in two tranches to Architects Studio Plus, the architect firm tasked with designing the space in Vilakazi street;


• VBS also paid R1-million directly to Grand Azania.