More details of alleged governance and financial breaches at Postbank will come to light after Minister of Communications and Digital Technologies Solly Malatsi referred a KPMG forensic report to the Hawks.
Malatsi said he had received the forensic report on governance and financial breaches at Postbank that compromised the institution and resulted in financial losses to the value of about R89.5 million during the period 2021–2022.
The report was presented to the parliamentary portfolio committee on communications and digital technologies by a delegation led by Deputy Minister Mondli Gungubele on Tuesday.
The KPMG investigation was instituted following confirmation by the Auditor-general of South Africa (AGSA) in her 2021 report, which detailed fraudulent activities at Postbank.
These include multiple incidents of cash theft, which had been reported to the SAPS.
Malatsi said: “What makes this cash theft even more repugnant is that some of this money was stolen from vulnerable social grant beneficiaries and ordinary South Africans who were saving for a better future. We will use the full might of the law to fight anyone who dares rob citizens. I expect decisive action to ensure that public entities are run ethically and with integrity, for the benefit of our citizens, and not criminals.”
The ministry had also instructed the Postbank board to ensure that the recommendations contained in the KPMG report were implemented.
The Department of Communications and Digital Technologies’ media liaison officer, Tlangelani Manganyi, said on Wednesday that the KPMG report would be shared with the media once it was handed to the Hawks.
In September last year, corporate tensions boiled over at the state-owned entity, which led to the mass resignation of the Postbank board.
The former minister of communications and digital technologies, Mondli Gungubele, invoked section 71 of the Companies Act, removing the non-executive board of directors of the South African Postbank after the board resigned en masse, alleging a “hostile and oppressive” work relationship with the minister.
Gungubele alleged that the Postbank board had pre-emptively resigned, following the outcome of a KPMG audit on an irregular R140m contract.
Gungubele revealed more details at the Postbank AGM: “In July 2023, KPMG requested a meeting with me wherein two damning forensic investigation report were tabled. As most of you in this room are aware, KPMG was appointed to conduct two forensic investigations into allegations of theft from Postbank through cash-out incidents.
“The amount that is reported to have been stolen from Postbank to date is around R120m. In summary, this theft has been committed using existing accounts of Sassa beneficiaries, withdrawing cash at ATMs, thereafter, cleaning up the transaction history on that specific account so that the money transferred and withdrawn does not reflect.”
He said the report showed that the banking system of Postbank was intercepted, and employees of Postbank had also been implicated in the process. “Necessary action has been instituted. This includes internal disciplinary processes and criminal investigations.”
He further said that the second forensic investigation related to Postbank contract management.
“The allegations were that the Postbank has continued to use service providers that have not been lawfully contracted. These service providers are being paid millions without valid contracts and proper procurement processes being followed. KPMG recommended that the shareholder must take action against the board of directors. This recommendation was also supported by senior counsel’s legal opinion, taking into account the details contained in the report,” he said at the time.
It is not yet clear if these KPMG investigations are the same issues as highlighted in the report to the Hawks.
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