Daily Maverick’s Election 2024 coverage is supported, in part, with funding from the Friedrich Naumann Foundation and vehicles supplied by Ford. 
‘I thought [VBS] would be a good thing. But it turns out, [by investing], we were just killing ourselves.”
These were the words of Magidi Salfina, who told Daily Maverick how her life changed forever after the politically connected drained the coffers of Venda Building Society (VBS) Mutual Bank, which was placed under curatorship in 2018.
Read more on Daily Maverick: Dissecting the VBS elephant six years on – the R2bn fraud, the R500m settlement and the plight of victims
“I put my entire pension in the [VBS] Bank. When I went to ask for my money, they told me the money was safe, I didn’t have to worry about it. It turns out they took all that money and ate it,” Safina recounted.
Sitting in front of her hawker stand with her two young grandchildren, Salfina said she thought her future would consist of resting and spending time with them. Instead, at the end of the school day, her grandchildren sit her under a tree on the side of the road while she tries to make ends meet by selling popcorn and biltong to passers-by.
The 67-year-old had spent years working as a cleaner in the Vhembe District and had banked that her monthly pension payout would allow her to live comfortably until her death.
“We are really suffering. We are starving. You can see I’m sitting here, selling things, instead of enjoying my pension.”
Thinking back to when the news of VBS being liquidated broke, Salfina said it didn’t immediately dawn on her that all her money had been stolen. It wasn’t until people who were part of community-based savings clubs went to the bank to demand their money, only to realise VBS had been looted and liquidated.
Alarmed by what she had been told by the stokvel members, Salfina and others who had invested at VBS rushed to the bank in Thohoyandou, Venda, and were devastated by what they witnessed.
“When we got to the bank in Thohoyandou, it was closed, and our money was gone,” Salfina said.
Magidi Salfina lost nearly her entire pension after investing in VBS Mutual Bank. (Photo: Julia Evans)
Chairperson turned victim
Daily Maverick’s hunt for the victims of the VBS heist led the publication to the door of none other than Madambi Wilson Muvhulawa, one of the founding members of the now defunct bank.
Sitting in his garden, which overlooked the town of Louis Trichardt, Muvhulawa eagerly detailed the rise and fall of VBS Mutual Bank.
The founding member said that before VBS became a mutual bank in 1982, it was known as the Venda Building Society.
“At that point in time, our people were taken as unbankable by the commercial banks,” said Muvhulawa, explaining how the VhaVenda people were excluded from investing or taking loans for development or improving their lives.“They were just keeping the money there, which was used to develop other people,” he added.
Muvhulawa explained that after the Venda Building Society officially became a bank, new blood came in with fresh ideas that revamped its operation. Not long after, the new recruits started pushing out the founding members, and the looting began.
Muvhulawa said that, coupled with the looting, a mad dash to withdraw savings by municipalities that had invested money in VBS after being told to do so by Treasury resulted in the Reserve Bank declaring VBS insolvent and liquidating it.
He said the board of directors heard on the news that the bank had been liquidated and they were no longer on the board.
Our poor people’s money was there, and now VBS has closed, and they cannot access that money. That is when our poor people started getting affected. They never had money to run their lives, and now this,” Muvhulawa said.
Madambi Wilson Muvhulawa, a former chairperson of VBS Mutual Bank, was devastated when the bank was liquidated and he and his community lost their life savings. He is seen here in Louis Trichardt, Limpopo. (Photo: Julia Evans)
Muvhulawa may have been a founding member and on the board of directors, but he was also a victim of widespread looting. When he spearheaded the drive to recruit the local communities to invest in the bank, he invested too because he wanted to lead by example.
“Because I was the one that recruited these people I had to go to them and say let’s fight for ourselves,” Muvhulawa said.
Muvhulawa’s feeling of responsibility led him to help form the VBS Shareholders’ Forum. “We were trying to negotiate with the Reserve Bank to say no, other people can lose the money but please make sure that our poor people can get their money.”
This resulted in the Reserve Bank releasing a maximum of R100,000 to some of the people affected by the liquidation of VBS.
Victimhood continues
Salfina the cleaner turned hawker who lost her pension was part of this shareholders’ forum, and said that while she got R110,000 back, it was not nearly as much as she had put in.
“The first payout, I got R100,000. And for the second payout, I only got R10,000. Since then, that’s all I’ve been given,” Salfina said.
When asked how much her pension payout was supposed to be, she said about R1-million.
When Daily Maverick asked if the government or VBS representatives had come to talk to the community about what had happened, she said not a single official had approached them. All they had heard was that the government was taking steps to address the issue, and when they had retrieved the money, the VBS victims would gradually get what had been stolen from them.
Salfina said that although the government has assured that the issue will be sorted out, she is still sceptical.
“I am not sure they are going to give us the money back. This is really hurting us,” she added.
Vuwani is one of the most impoverished and poorly serviced towns in the Vhembe district of Limpopo. (Photo: Julia Evans)
A short walk from Salfina’s stall sat Nelta Ngobeni, shaded by her umbrella, as she sold fresh vegetables and achar, which she sells to make ends meet.
Unlike Salfina who lost most of her pension to the looting, Ngobeni was only affected through the stokvel she is a member of – for which she is grateful.
A stokvel is an informal savings society in which a group of friends, relatives or colleagues pool and manage their money.
“All our money was taken – to this day I don’t even know how much. All I know is it was more than R100,000.”
Similar to Salfina, Ngobeni’s stokvel got R100,000 back through the efforts of the investors’ forum Mavhulawa helped to set up.
Read more in Daily Maverick: 2024 elections
Regardless of how much Salfina and Ngobeni lost, they still plan to vote on 29 May.
“What happened with VBS has nothing to do with the elections,” Salfina said, adding that VBS has nothing to do with President Cyril Ramaphosa, indicating her intention to vote for the ANC.
Ngobeni said she is still unsure who to vote for but definitely plans to cast her ballot.
Muvhulawa is still coming to terms with the dramatic decline of the Bank he helped start: “I was there from day one when it started and I was personally involved in convincing ordinary people to bank their money. When I look at them it pains me.”
Muvhulawa said the fall of VBS affected him, not just financially as he also invested his own money, but healthwise.
“Money lost can never be [recovered]. When you are old you can never build it up again, because it took time to build up that money we invested,” Muvhulawa said. DM
Daily Maverick’s Election 2024 coverage is supported, in part, with funding from the Friedrich Naumann Foundation and vehicles supplied by Ford.
This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R35.
