"Suspect personal loans a one-way trip to destroying any leader's integrity"

It's ironic that our new Minister of Justice is under scrutiny herself at the moment about a loan of over R500 000 she secured from VBS Bank through a 'fier'' that was not a registered financial services provider.

Between 2014 and 2021, Thembi Simelane was mayor of the Polokwane Municipality, one of the councils that deposited money with the bank that was later disgraced.

While claiming that she repaid the loan, Thembi Simelane has not yet provided proof of this.

Amid calls for her to step down, the Minister has maintained that there is no conflict of interest around her oversight role for the National Prosecuting Authority (NPA).

Simelane's is not an isolated case - there seems to be a growing trend for high-profile figures to enter into dubious loan agreements in their personal capacity.

Andrew Woodburn, MD of executive search firm Amrop Woodburn Mann, talks about a 'tree' of lending we can access as ordinary, working citizens and what other options exist when we exhaust this.

The conventional route starts with the regulated, officially licensed banks.

"Then it might go down to unsecured lending which is still through a regulated institution offering finance under certain criteria, and then it might go down to asset-based loans - for example, you might extend the bond on your home."

Andrew Woodburn, MD - Amrop Woodburn Mann

While you might not have many other choices once those options are used up, there are still some available, he goes on.

Those would include individuals or registered/unregistered businesses you may try to borrow from.

What our current and future leaders should keep in mind is that everything they do is now recorded electronically, Woodburn says.

"The likes of SARS and other instituions can track where the money came from, where the money goes, did you pay tax on it and so on.

"And this 'personal loan' thing that is climbing up the rankings of excuses for where money came from and where it went to is a one-way trip to destroying any leader's integrity."

Andrew Woodburn, MD - Amrop Woodburn Mann

Aside from raising doubts about a leadership figure's integrity, these kinds of loans of course reflect poor decision making which then makes us question the person's ability to manage the money of employees or citizens in the case of a government appointment.

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