The High Court in Johannesburg on Thursday ruled that brother of Economic Freedom Fighters (EFF) deputy president Floyd Shivambu, Brian, must pay the legal costs of liquidators of VBS Bank, in a case relating to an application to liquidate his company, Sgameka Projects.
According to a report in the Mail & Guardian, Sgameka Projects was indebted to the controversial and now defunct bank, but managed to settle the more than R4 million owed to the now-liquidated bank last month.
This led to the court dismissing a liquidation application for Sgameka, but still left Brian with the legal costs, with the court ordering: “As regards the scale of the costs to be paid, there is no reason to deviate from the scale of costs contractually agreed as between the parties.”
Failure to settle the debt would have allowed VBS liquidator Anoosh Rooplal access to Sgameka Projects’ bank accounts.
Rooplal in January approached the courts to get Shivambu to pay back over R1.5 million owed on a mortgage and over R2.7 million owed on the load facility, with his payment of the money allowing him to escape being liquidated by Rooplal.
An earlier request to pay of the debt in R5,000 monthly increments led to Rooplal heading to court with a liquidation application.
The high court judgment from yesterday stated that Rooplal argued that Shivambu’s failure to pay back the loan indicated that he was struggling financially and should be liquidated.
Sgamaka in response said a proper case for its liquidation had not been made.
On August 5, Brian was made personally liable for the loan debt, at which point his lawyers made a R1 million payment into the load account. He completed the remaining payments by September 10.
This led to the parties agreeing “that the mortgage credit agreement was no longer relevant to the liquidation”, court papers indicate.
Prior to Shivambu’s September 10 payments, his lawyers said that the possibility that Sgameka could pay its debts and avoid going under meant a liquidation order should not be granted and that if one was granted, it should only be a provisional one.
Following the payments, the case was postponed to September 27, at which point the liquidation application was dismissed as it was no longer necessary due to the payments.
Mail & Guardian reported that it had discovered alleged links between a vehicle he once owned, a Range Rover Sport, and illicit money from the looted VBS Mutual Bank.
According to the publication, R680,000 paid to a Sandton dealership from his brother’s company Sgameka Projects was linked to VBS.
The Daily Maverick released a report in November last year, detailing how its investigative journalism unit, Scorpio, found that both EFF leader Julius Malema and Shivambu knowingly and directly benefited from the “looting” of VBS Bank.
While the Mail & Guardian has previously linked Malema directly to the VBS scandal through his cousin, Daily Maverick took this one step further, verifying these claims through their investigation.
According to Daily Maverick, the EFF received more than R1.8 million from VBS, with the funds flowing from two sources acting as fronts. In addition to this, Malema allegedly received R430,000 in three installments, which he is believed to have spent on a luxury Sandown property where he had lived from 2012, but which has now reportedly been transferred to the EFF.
Van Wyk also described Brian Shivambu’s press statement, in which he claimed to have only received money from Vele Investments, not VBS, as “a crude lie”.
The EFF were approached for comment, with answers from Malema and EFF spokesperson Mbuyiseni Ndlozi denying knowledge of any link between VBS Bank and their party.
(Compiled by Daniel Friedman.)