Gungubele: Postbank board resignations due to illegal contract allegations
Communications and Digital Technologies Minister Mondli Gungubele says the Postbank board members who've resigned did so due to serious allegations involving illegal contracts.
Gungubele told a media briefing in Pretoria on Thursday afternoon that a forensic investigation by KPMG found the bank failed to follow proper processes when contracting certain service providers.
The minister’s remarks came hours after the resignation letters of Postbank chair, Thobile Wonci and two other non-executive directors, became public.
They've accused Gungubele of interference and an oppressive and hostile attitude.
Gungubele said poor governance cannot be tolerated.
"One of the fundamental problems has been the continuation of an illegal contract which was paid no less than R140 million and without a justifiable explanation why it was allowed continue. As a matter of record which I know it is transparent, it's public.
READ: Postbank chair resigns amid grant payment chaos
"You know Postbank has had disclaimer for no less than two years. No serious minded-nation can allow a financial institution to tolerate that. Normally financial institutions are held in the highest regard as compared to any other institution."
The developments come amid the bank's delays in the payments of social grants.
Thousands of SASSA beneficiaries were left high and dry after not being able to access their payouts for several days.
The bank has said technical glitches from a systems upgrade are to blame.
Minister Gungubele said some individuals trying to defraud the system in order to get paid twice have caused further delays in resolving the payment issues from last week.
"Our systems are very thorough therefore people will not be able to defraud the system instead, what they are doing is clogging up the system and thereby delaying the process of dealing with the valid reversals. We condemn these attempts and further warn those people to stop this."
