VBS Mutual Bank Scandal: R1.3 billion Gold-Fuelled 'Hawala'

A major monetary system, coined as 'hawala', suspected to be powered by unlawful gold trade, operated via three VBS Mutual Bank's accounts from late 2016 until the bank's fall in 2018. An astounding R1.3 billion was allegedly transacted through this system to a vast number of South African firms and people, as reported by the #MotiFiles.

Characterized as an informal money transfer system, a 'hawala' bypasses banks and financial authorities, allowing an operator to instruct their overseas counterpart to hand over an equivalent sum to a particular recipient, without any cross-border transaction officially happening. This approach enabled Zimbabweans to bypass the harsh exchange restrictions in their country, and served as a tool for money laundering and shadowy financial flows via the ambivalent local gold market.

Companies within the Moti Group along with Zimbabwe's Macmillan and Rudland families and a prominent member of the Mugabe family were among the alleged beneficiaries. This operation was purportedly orchestrated by relatives of Ewan Macmillan, an infamous Zimbabwean money launderer. As the MotiLeaks exposé unfolds, it is apparent that VBS Mutual Bank was not just a financial institution, but a hub of a series of alleged illicit schemes unified by their ability to circumvent usual banking scrutiny.

Firms named Caydees Imports and Exports, Taintons Goods and Service, and Caylons Goods and Services were found to be the principle conduits of this supposedly fraudulent transaction system. The forensic report by Werksmans Attorneys emphasized bribes in the millions purportedly handed to VBS management to pave the way for this system.