KPMG vows to work with Reserve Bank in wake of damning VBS report

KPMG partner Sipho Malaba was aware of nearly R1-billion cash shortage at VBS Mutual Bank, but cleared its financials anyway. (Alon Skuy/Gallo Images)

KPMG partner Sipho Malaba was aware of nearly R1-billion cash shortage at VBS Mutual Bank, but cleared its financials anyway. (Alon Skuy/Gallo Images)

KPMG has vowed to work on rebuilding trust in its reputation following the release of the South African Reserve Bank’s (SARB) report into VBS Mutual Bank, the global auditing firm said in a statement on Thursday.

The statement was released on Thursday, acknowledging the outcome of the report.

In the report, released on Wednesday, it is said that KPMG partner Sipho Malaba was aware of nearly R1-billion cash shortage at VBS Mutual Bank, but cleared its financials anyway.

According to the report, Malaba received about R28-million from the exercise. Malaba has since parted ways with KPMG as a partner.

In its statement, KPMG said it recognised the seriousness of the report’s findings and would cooperate with any investigations that emanated from the report.

READ MORE: KPMG exec embroiled in VBS probe

According to the report by Advocate Terry Motau, titled ‘The Great Bank Heist’, Malaba defrauded the South African Reserve Bank, and should be both criminally charged and held liable through civil proceedings.

KPMG executive chairman Wiseman Nkuhlu said the firm would take stock of the investigation and would cooperate with the Reserve Bank, should it be required to do so.

“Lessons have been learned and decisive action has been taken since these matters came to light, and we will study the SARB’s report to see if there is more we can do.
There can be no tolerance of any conduct that compromises the quality and integrity of our work,” said Nkuhlu.

READ MORE: KPMG woes deepen after VBS bank scandal

Nkuhlu said KPMG was prepared to perform due diligence in areas that allowed the firm’s public image to suffer.

“I am confident that the extensive remedial changes the firm has already made will enable us to rebuild public and client trust in KPMG, helping us to continue to serve business and society in South Africa,” Nkuhlu said.

KPMG announced last week that its CEO in South Africa, Nhlamulo Dlomu, had vacated the position to assume another position in the firm’s global group. — Fin24

Khulekani Magubane
Kyle Cowan

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