The Select Committee on Economic Development and Trade has heard how officials working for Post Bank had operated in cahoots to syphon millions of rands from the struggling state-owned entity.
These revelations were made on Wednesday when the committee met. The meeting was to hear the preliminary findings of the probe into the financial losses of over R92-million through cybercrime. The well-orchestrated crime mostly involved the accounts for social grant beneficiaries.
SOEs staff worked with cyber criminals to loot R92m
Following the loot, Post Bank said it was spending over R400 million to upgrade its IT infrastructure. The move was to avert similar incidents.
“It is unfortunate that the Post Bank system was exposed to outside criminality by employees who work for the state entities. The people one least expects to undo the good work of the government become the same persons who frustrate that good work,” charged Bones Modise. He said this during the committee sitting.
He slammed Post Bank management for sleeping on duty. It failed to detect and intercept fraud before substantial state money went down the drain, he said.
“This kind of fraud clearly showed that the government must apply a firm hand to thieves in the system. Those who sometimes are a danger to their colleagues who are able to identify these kinds of transgressions,” he said.
KPMG probe uncovered sophisticated syndicates
Ntomboxolo Mbengashe, Post Bank CEO, told the committee about the findings of the auditing firm KPMG. She said they showed that sophisticated syndicates worked with suppliers and Post Bank staff to carry out the crime.
“The fraud occurred in four instances over a period of time,” she told committee members.
Modise was, however, unrepentant. He said the committee welcomed the consequence management being implemented. And acknowledged that some employees had been taken to task. But he said it’s a little too late.
“But why did we wait until it came to this point, the system was clearly compromised. Why did it get to a point where we lost R92-million?” Modise asked.
The investigation also revealed that a junior official had picked up the fraud with the committee. This raised grave concerns about his safety.
The shenanigans plaguing Post Bank come as government moves to develop it into a fully fledged bank.
