Brilliant Telecommunications, which was awarded a crucial R585-million IT contract by the City of Tshwane, has lost another key legal bid to keep details about why it was awarded the contract under wraps.

But apart from its ability to deliver the necessary services, the company's apparent connections to VBS Mutual Bank may also raise questions.

Earlier this year, Tshwane appointed Brilliant to manage the city's Wi-Fi, telephone and radio networks, voice, internet and other services, including the city's call centre, which is the main contact point for residents in need of emergency services.

But Altron, which provided the services for 18 years, has turned to the high court in Pretoria to declare the contract invalid. It presented evidence that Brilliant was not accredited with Alcatel-Lucent and Huawei, which exclusively supply the key equipment needed for the work. Brilliant also doesn't hold two licences from the Independent Communications Authority of South Africa (Icasa), as required by the tender, among other irregularities alleged by Altron.

In a scathing judgment in September, the court ordered the City of Tshwane to reveal documents to show why it awarded the contract to Brilliant, which was the second respondent in the matter. Tshwane refrained from taking further legal action to defend its decision to award the contract, but Brilliant applied for leave to appeal the court order. This week, its bid failed.

While Brilliant fought to keep its tender documents for the IT contracts from public view, News24 has confirmed the company's historic connections to key VBS Mutual Bank executives from Companies and Intellectual Property Commission (CIPC) records and interviews.

While Brilliant itself is not implicated in any VBS wrongdoing, it appears to have helped pave the way for Tshifhiwa Matodzi – former VBS chair and accused number one in its extensive looting – to get access to the mutual bank, which collapsed in 2018.

In its wake, VBS left behind devastation as the lifelong savings of pensioners and widows from the Venda area of Limpopo disappeared. Some municipalities from Gauteng, Limpopo, the Free State and the North West also lost billions that had been irregularly deposited with the mutual bank.

Advocate Terry Motau, who conducted a forensic investigation into the demise of VBS on behalf of the SA Reserve Bank, found that Matodzi was the kingpin in the VBS heist, and that he himself, his companies, and his associates were the main beneficiaries of the massive fraud.

Matodzi was arrested by the Hawks in June 2020, along with 15 former VBS executives and officials of some municipalities, and charged with fraud, money laundering, corruption, racketeering and common law theft.

Matodzi is accused of pocketing R326-million in the VBS crime, in which R2-billion was stolen in a criminal racket allegedly perpetrated by its executives and shareholders. All the accused deny the charges. He is standing trial as accused number one in the criminal case that started in October, alongside 14 others.

Matodzi told News24 that he was a founding member of Brilliant in 2002, along with Brilliant's current CEO, Maanda Reuben Phalanndwa. Phalanndwa is currently the sole director in the company. Phalanndwa has not been directly linked to any wrongdoing with regards to VBS.

Asked about Brilliant’s relationship with VBS, Phalanndwa told News24, "Brilliant (Telecommunications) and its directors conducted regular business with VBS Bank like any other bank client. The relationship between the bank and its client is confidential in nature, and I do not wish to delve into those details. For the record, neither Brilliant (Telecommunications) nor its director owes VBS liquidators any money."

"Regarding questions about my family benefiting (from VBS), I am not privy to such information, as I was neither a director nor an employee of VBS and had no role in the day-to-day operations of the bank," said Phalanndwa.

But one person close to the business says Brilliant was Matodzi’s "baby", and he was intimately involved in its operations from the start.

"Maanda started the business. Tshifhiwa [Matodzi] is the one who brought oxygen to it. The oxygen was Tshifhiwa. There was no plan or project - those he brought in. I can assure you that Brilliant Telecommunications, as with VBS, was his baby," the person, who didn’t want to be named, told News24.

Both Phalanndwa and Matodzi confirmed to News24 that Matodzi, who was the VBS chair in the two years before its collapse, took a 45% stake in Brilliant Telecommunications in 2005. He became a director the following year and resigned in 2009.

In April 2017, a year before the implosion of VBS, Matodzi transferred his Brilliant shares back to Phalanndwa and ceased to be a shareholder. No monies exchanged hands during the exchange of shares, according to the shareholder register. Matodzi told News24 that he hasn’t been involved in Brilliant "in any form" since 2016.

But Brilliant was critical in giving Matodzi access to VBS.

A decade ago, Brilliant provided Matodzi and Phalanndwa, who were its shareholders and directors, with R3-million in seed money to establish a company called Dyambeu Investments, together with businessman David Mabilu, who pitched in R3-million. Brilliant Telecommunications got a 24.5% share in Dyambeu, and directorships for Mabilu, Matodzi and Phalanndwa.

The Venda king, Toni Mphephu Ramabulana, received a free 51% stake in Dyambeu, according to Motau. This was confirmed to News24 by Phalanndwa.

With its R6-million in seed money, Dyambeu acquired a 26% stake in VBS the same year, which secured a board seat in the bank for Matodzi. He was later appointed the mutual bank's chairperson.

According to Motau’s report, Matodzi - while he was still a shareholder and director of Brilliant Telecommunications - and Vele Investments (which Matodzi chaired) received hundreds of millions of VBS's stolen cash in either credit facilities or sham loans.

Motau found VBS executives created fictitious deposits in favour of Vele, which used these fake deposits to buy itself a 53% stake and assumed control of the mutual bank.

News24 asked the City of Tshwane whether it had conducted any due diligence on Brilliant Telecommunications as part of the IT contract tender. But spokesperson Selby Bokaba said the city had been advised that, since the Altron matter is before court, it shouldn’t respond to media enquiries.