Round about 2006, the Bank of China obtained a large share in Standard Bank SA.

China has the second biggest economy in the world. Due to the trade biocot by USA the Chinese economy dogged. For example Hong Kong is presently in a recession. According to information I received from one of SB managers, the Bank of China is consistently placing pressure on Standard Bank SA to increase their profits.

Mortgage loans are the biggest income of Standard Bank SA, the only way to increase profitability, was to overcharged SB mortgage clients and the only way to do that was as follows:-


  1. Charge illegal administration cost.

  2. Increase the agreed interest rate.


Over the past  12 months, Emerald van Zyl have investigated the statements of 160 Standard Bank mortgage clients and here is his findings being described to by him as the biggest mortgage scandal in the history of South African banking. Here is his comment:-





Firstly, I do believe it is very important to explain the history of Adm Fees


          In 1999 the Usury Act, Act 73 of 1968 was amended to allow banks to

          recover a monthly administration fee of  R5,00 (VAT excluded).

          The purpose of this fee was in order to prevent discrimination with

          interest rates against smaller loans in the primarily black low cost

          housing sector. The Act determined that there must be a written

           agreement to charged this fee and also the amount of the fee.

           On 1 June 2007 the National Credit Act was promulgated

           and the Administration Fee of R 5 (VAT excluded) was

           increased to R 50 (Vat excluded ) and renamed “Service

           Fee”. The directives of the National Credit Act also determine

           as the Usury Act that there must be a written agreement in place to

           recover this fee.







During the later part of 2010, I discovered that Standard Bank increased the monthly administration fee on mortgage loans registered prior to the promulgation of the National Credit Act in June 2007 The permitted fee is R 5 (VAT excluded) and must be agreed upon in a written agreement.


Four cases with excessive administration fees were referred to the National Credit Regulator by myself on behalf of the clients.


On 29 November 2012 the South African : Supreme Court of Appeal ruled in the matter between the National Credit Regulator (Appellant)  v Standard Bank of S.A. Ltd (Respondent) (Case No 231/12) as follows-


“It is declared that the respondent is not entitled to charge an administration fee on housing loans that existed at the time the National Credit Act 34 of 2005 came into operation in excess of the fee provided for in paragraph 3(b)(i) of the schedule to the Usury Act, Act 73 of 1968 unless and until       that fee is amended under the powers conferred by s105(1)  of the National Credit Act.





  In mid January 2013 Standard Bank said in a press release that allprejudice clients were refunded on 5 January 2013.




 It now transpired from more than 160 client’s statements I investigated, only 45% of all prejudice clients were refunded and the amounts that were refunded were only  40% of the correct amount due at that point in time. 


The next month after the refund, Standard Bank continued  levying this illegal monthly admin fee in order to satisfy the Chinese demand, blatantly ignoring the Appeal Court judgment and the directives of the Usury Act. It is estimated that the total amount due to clients at this point in time  is in excess of R 2 billion.






The Usury Act and the National Credit Act states that a single rate must

 be agreed upon for the term of the mortgage loan. This is written into

Agreements of Standard Bank mortgage loans.


 Soon after the Chinese deal it became an internal policy of Standard Bank to increase the interest rates when an account goes into arrears. This is totally illegal and under the directives of

 the Usury Act this is a criminal offence.

 The last 6 mortgage investigated by myself the overcharges were R 96 000,  R 134 000, 

 R 149 000, R 234 000, R 288 000 and R 838 000 respectively due to this prohibited conduct. The client that were overcharged by R 288 000 was settled by Standard Bank last week



C) Standard Bank applied a fixed interest rate:-


Now here is the latest and new in South Africa. In 3 cases Van Zyl investigated, Standard Bank applied a fix interest rate for a period of 18 months at an interest rate of approximately 6 % higher than the agreed rate. In all both these cases the clients were not aware of such a “fixed rate” agreement. On request Standard Bank could not produce any documentation for such an agreements. The overcharges on these three accounts are R 88 00, R 134 000 and R 320 000.



Over the past 12 months, I successfully assisted 12 Standard Bank Mortgage clients to stop the sale in execution of their homes . In another 11  litigation cases the clients attorneys successfully entered into defence in the matter based on my expert report. One client who was overcharged with R 288 000 was refunded the amount together with his legal cost




Kindly note that this is Van Zyl’s findings  on 160 mortgage loans he investigated. It is therefor advisable to all Standard Bank mortgage clients to have their Standard Bank mortgage account investigated.



Emerald can be contacted at 082 291 1333 or by e mail at This email address is being protected from spambots. You need JavaScript enabled to view it. This email address is being protected from spambots. You need JavaScript enabled to view it. .za or This email address is being protected from spambots. You need JavaScript enabled to view it. This email address is being protected from spambots. You need JavaScript enabled to view it.