THE STATUS CAPITAL PARADOX: WHO BENEFITS FROM GOING IN CIRCLES?
There comes a moment in every regulatory saga when the central question is no longer about compliance, but about intent.
The Status Capital Building Society (SCBS) matter has reached that moment. After a long time of squabbles, court battles, audits, counter-claims and official pronouncements, one must now ask, candidly and without fear, who truly benefits from the endless circular motion surrounding SCBS? Certainly not the members. Certainly not an economy desperate for capital formation, jobs and indigenous financial institutions. And increasingly, not the credibility of the regulator itself.
Just over two months ago, a rare beam of light pierced through the fog. Permanent member Dave van Niekerk announced a successful settlement between SCBS and SDFF, relating to investments advanced during his tenure as a non-executive board member. The figures were not trivial. A total of E85 million, inclusive of interest, is being repaid. E10 million plus an additional E7.5 million has already landed in the Society’s bank account, with the balance scheduled for progressive repayment over the coming months. Members were relieved. Some even felt, for the first time in years, that resolution was possible. Last year alone, E35 Million was paid.
Paradoxically, this milestone, arguably the strongest evidence that SCBS still has life, assets and recoverable value, has not resulted in regulatory de-escalation. Instead, the Society remains under curatorship, with members excluded from oversight, leadership sidelined, and liquidation hovering like a predetermined conclusion rather than a last resort.
The Financial Services Regulatory Authority (FSRA) and the Ministry of Finance must now answer uncomfortable questions. Why persist with a posture that appears hostile to recovery when repayments are demonstrably underway? Why cling to curatorship when investments are being settled, and when the very members the regulator claims to protect are pleading for democratic control of their institution?
Van Niekerk’s concern is both sober and legitimate. As long as SCBS remains under curatorship, there is no assurance to members regarding how recovered funds are managed or allocated. Earlier repayments, including E35 million remitted earlier this year, have yet to be transparently accounted for, we are told. Instead, Society resources continue to bleed into legal fees, administrative overheads and prolonged court battles that produce no tangible benefit for pensioners and ordinary investors.
At what point does “protection” begin to resemble punishment?
Those familiar with the early history of SCBS tell a story that sharply contradicts the more dramatic labels now casually attached to the institution. By late 2021, SCBS had mobilised approximately E174 million in investor funds, largely from pensioners, through a model that is neither novel nor unlawful in the financial sector. Offering competitive interest rates to build a capital base is precisely how building societies are born—locally and globally.
Funds were invested through debenture loan agreements, drafted and overseen by qualified legal and compliance professionals, some of whom had previously worked within regulatory structures themselves. The strategy was straightforward: invest at higher rates, pay investors competitively, and retain a margin for operations. Comparable institutions across the region operate in exactly this manner, often at far higher interest spreads.
If SCBS was allegedly operating outside its licence, as a pyramid scheme, or as a vehicle for money laundering, the obvious question is: when did the regulator discover this, and where is the report? FSRA has conducted audits and issued licence renewals since SCBS’s establishment. Why now? Why after years of regulatory engagement? And why, crucially, has no comprehensive investigation report been shared with members and stakeholders?
Transparency is not optional when livelihoods are at stake.
Even more troubling is the apparent haste with which liquidation has been pursued, at times during periods when regulatory offices were officially closed, allegedly without meaningful consultation with shareholders. This despite earlier assurances that liquidation was not the intended outcome.
Liquidation is not a neutral administrative act. It is a final economic death sentence. It destroys enterprise value, eliminates jobs, erodes ownership, and often enriches a narrow circle of professionals while members receive cents on the lilangeni. When foreign firms are engaged, capital leaks out of the country, ironically under the watch of institutions mandated to safeguard national economic interests.
Is this really the best outcome for Eswatini?
In the midst of this institutional rigidity, Dave van Niekerk’s role stands out. Long before settlements were reached, he publicly warned members, at personal cost, about mismanagement within SCBS. Most of that management is now gone, yet the Society itself, with its members and remaining assets, continues to be treated as irredeemable.
Van Niekerk’s position is not reckless optimism. It is a structured appeal for putting to an end curatorship, reinstating a member-elected board, restore democratic governance, and allow new capital to be raised under proper oversight. This is not special pleading; it is economic common sense.
If there were individual acts of wrongdoing, the law provides mechanisms to pursue individual accountability. Shutting down an entire institution because of alleged misconduct by a few is neither just nor proportionate. It is institutional overkill. Lost in legal jargon and regulatory posturing are the real people, mostly pensioners, who entrusted their savings to SCBS. They are not asking for miracles. They are asking for partial payouts for basic upkeep. They are asking to know where recovered funds are going. They are asking why decisions about their money are made without them.
Tomorrow, Wednesday 14 January 2026, these members will gather at Sibane Sami Hotel in Ezulwini to seek clarity, unity and direction. That meeting should not be seen as defiance. It is a cry for dignity.
The central question in all these is on whose best interest is liquidation being pursued? Certainly not the members. Not the workers. Not the economy. And increasingly, not even the reputation of regulatory governance in Eswatini.
The FSRA and the Minister for Finance still have an opportunity to change course, to prove that regulation is about enabling sustainable finance, not extinguishing it. Giving Status Capital Building Society a genuine chance to recover under member control would not be regulatory weakness. It would be regulatory maturity.
History will remember who chose resolution over rigidity, and who chose to pull the plug when recovery was still possible.