Former Zimbabwean Vice President Phelekezela Mphoko’s son and non-executive director of Choppies Zimbabwe, Siqokoqela, has been charged with 170 counts of fraud after allegedly making unauthorised cash pick-ups of up to $52,000 from Choppies retail outlets in Zimbabwe.
This ongoing court case has also been linked to his ongoing shareholder dispute with other Choppies shareholders in Botswana. Siqokoqela, 40, has already appeared before Bulawayo magistrate Sithembiso Ncube and was remanded to September 14 on $200 bail. The case was expected to go for trial this week but was postponed to next week after it emerged that some files were not duly served on the defence.
Furthermore, Siqokogela’s wife, Nomagugu, 36, was charged with 49 counts of extortion. She is accused of swiping-for-cash at 15 supermarkets and threatening to have managers of Indian origin sacked if they refused to give her cash, which is scarce in Zimbabwe. They are both represented by Professor Welshman Ncube of Mathonsi Law Chambers.
Siqokoqela, being a shareholder and director of Nanavac Investments Private Limited trading as Choppies Zimbabwe, is accused of deceived employees that he was entitled to receive certain amounts of money and services. Choppies Zimbabwe is represented by Ottapathi Ramachandran who is the group CEO for Choppies Distribution Centre Private Limited and Choppies Enterprises.
Siqokoqela is a shareholder and one of the six directors of Choppies Zimbabwe. He is currently disputing the shareholding structure as presented by Ramachandran and other directors. Siqokogela is claiming that the 51% he holds has capital interest while the Botswana based Choppies directors point out that he only has 7% economic interest.
THE SHAREHOLDING DISPUTE EXPLAINED
Choppies was approached by Raj Modi who is currently deputy Trade Minister in Zimbabwe to buy 7 stores from him. At the time he had won 7 Spar outlets. After agreeing on a price to buy the business from Modi, Choppies had the task of looking for a local partner to satisfy the Zimbabwe law at the time which stipulated 51 percent for locals and 49 percent shareholding split for locals.
Siqokogela who was by then working for Capital Management Botswana (CMB) as a clerk approached Choppies and promised to deliver a local partner in Zimbabwe, who was his father Phelekezela Mphoko. At the time Mphoko was Zimbabwe Ambassador to South Africa and had indicated that he will be retiring in six months’ time and relocating to Zimbabwe. Choppies proceeded by acquiring a $20 million loan in Zimbabwe and pumping in P5 million from its Botswana operations.
This was in 2013 and 8 stores were opened to start the business. Today Choppies Zimbabwe operates 35 stores, employs 2200 employees with 85% of the products sold in outlets sourced locally. At this stage Mphoko (who had returned to Zimbabwe in December 2013 as a retiring diplomat) still had 7% economic interest and 51% shareholding in Choppies Zimbabwe to satisfy the country’s regulatory environment then.
The other Choppies shareholders remained with 93% economic interest and 49% shareholding for voting rights. Communication between Choppies Distribution and Mphoko indicates that he was given shareholding on silver plate, he did not contribute a dollar, furthermore he was not holding any political office at the time he was given the shares. Choppies Distribution Centre was given the full control to operate the business.
HOW MPHOKO’S SON CAME INTO THE PICTURE
Siqokogela was somewhere between 2014 and 2015 given a job as a Business Development Manager in Choppies Zimbabwe. There were a number of political twists in Zimbabwe at the time and his father, Phelekezela was later appointed Vice President of the Republic of Zimbabwe in 2015. This then forced Choppies shareholding to push him to step down as director because of his political office, although there was a bit of resistance, he ultimately resigned. However he continued getting his 7% economic interest.
Government changed in Zimbabwe in 2017 after Robert Mugabe was removed from the Presidency and Emmerson Mnagagwa ascended to power. With some of his changes, the 51/49 percent legal instrument was no longer applicable and Mphoko was informed by other shareholders that the shares arrangement needed to be fixed.
There is back and forth communication on this subject, with the Mphoko side avoiding deliberating or engaging on it until he was removed from the Vice Presidency. This is where Mphoko’s son started getting involved on the matter indicating that they were not agreeable to the proposals from the other shareholders.
With cash running dry in Zimbabwe and Phelekezela having retired with no consistent income, the war for the control of Choppies Zimbabwe economic interest was inevitable. Weekend Post gathers that the Choppies CEO, Ramachandran was instructed by Choppies chairman, Festus Mogae fly to Zimbabwe and lay fraud charges against Siqokogela after they discovered that he was cashing money from Choppies outlets. The Zimbabwe Commercial Crimes Unit has slapped him with 170 charges. At no point during this business relationship were the Mphokos signatories to the bank.
During this tiff with Mphoko junior, Choppies found itself in accusations of money laundering and false investigations being linked to their business. Choppies Zimbabwe has a restraining order against Siqokogela so that he does not enter the outlets or come near employees. It has also emerged that the other shareholders have an option to buy 44% of his shares for $1. The company has two classes of shares – the economic interest and voting rights shares.
The Directorate of Public Prosecutions (DPP)’s decision to reject and appeal the High Court’s verdict on a case involving High Court Judge, Dr Zein Kebonang has frustrated the Judicial Service Commission (JSC) and Judge Kebonang’s back to work discussions.
JSC and Kebonang have been in constant discussions over the latter’s return to work following a ruling by a High Court panel of judges clearing him of any wrong doing in the National Petroleum Fund criminal case filed by the DPP. However the finalization of the matter has been hanged on whether the DPP will appeal the matter or not – the prosecution body has since appealed.
Botswana Democratic Party (BDP) top brass has declined a request by Umbrella for Democratic Change (UDC) to negotiate the legal fees occasioned by 2019 general elections petition in which the latter disputed in court the outcome of the elections.
This publication is made aware that UDC Vice President Dumelang Saleshando was left with an egg on his face after the BDP big wigs, comprising of party Chairman Slumber Tsogwane and Secretary General Mpho Balopi rejected his plea.
“He was told that this is a legal matter and therefore their (UDC) lawyer should engage ours (BDP) for negotiations because it is way far from our jurisdiction,” BDP Head of Communications, Kagelelo Kentse, told this publication.
This spelt doom for the main opposition party and Saleshando who seems not to have confidence and that the UDC lawyers have the dexterity to negotiate these kind of matters. It is not clear whether Saleshando requested UDC lawyer Boingotlo Toteng to sit at the table with Bogopa Manewe, Tobedza and Co, who are representing the BDP to strike a deal as per the BDP top echelons suggested.
“From my understanding, the matter is dealt with politically as the two parties are negotiating how to resolve it, but by far nothing has come to me on the matter. So I believe they are still substantively engaging each other,” Toteng said briefly in an interview on Thursday.
UDC petitioners saddled with costs after mounting an unprecedented legal suit before the court to try and overturn BDP’s October 2019 victory. The participants in the legal matter involves 15 parliamentary candidates’ and nine councillors. The UDC petitioned the court and contested the outcome of the elections citing “irregularities in some of the constituencies”.
In a brief ruling in January 2020, Judge President Ian Kirby on behalf of a five-member panel said: “We have no jurisdiction to entertain these appeals. These appeals must be struck out each with costs including costs of counsel”. This was a second blow to the UDC in about a month after their 2019 appeals were dismissed by the High Court a day before Christmas Day.
This week BDP attorneys decided to attach UDC petitioners’ property in a bid to settle the debts. UDC President Duma Boko is among those that will see their property being attached with 14 of his party members. “We have attached some and we are on course. So far, Dr. Mpho Pheko (who contested Gaborone Central) and that of Dr, Micus Chimbombi (who contested Kgalagadi South) will have their assets being sold on the 5th of February 2021,” BDP attorney Basimane Bogopa said.
Asked whether they met with UDC lawyers to try solve the matter, Bogopa said no and added. “Remember we are trying to raise the client’s funds, so after these two others will follow. Right now we are just prioritising those from Court of Appeal, as soon as the high court is done with taxation we will attach.”
Saleshando, when contacted about the outcomes of the meeting with the BDP, told WeekendPost that: “It would not be proper and procedural for me to tell you about the meeting outcomes before I share with UDC National Executive Committee (NEC), so I will have to brief them first.”
UDC NEC will meet on the 20th of next month to deal with a number of thorny issues including settling the legal fees. Negotiations with other opposition parties- Alliance for Progressives and Botswana Patriotic Front (BPF) are also on the agenda.
Currently, UDC has raised P44 238 of the P565 000 needed to cover bills from the Court of Appeal (CoA). This is the amount in a UDC trust account which is paltry funds equating 7.8 per cent of the overall required money. In the past despite the petitioners maintaining that there was promise to assist them to settle legal fees, UDC Spokesperson, Moeti Mohwasa then said the party has never agreed in no way to help them.
“We have just been put in debt by someone,” one of the petitioners told this publication in the past. “President’s (Duma Boko) message was clear at the beginning that money has been sourced somewhere to help with the whole process but now we are here there is nothing and we are just running around trying to make ends meet and pay,” added the petitioner in an interview UDC NEC has in December last year directed all the 57 constituencies to each raise a minimum of P10, 000. The funds will be used to settle debts that are currently engulfing the petitioners with Sheriffs, who are already hovering around ready to attach their assets.
The petitioners, despite the party intervention, have every right to worry. “This is so because ‘the deadline for this initiative (P10, 000 per constituency) is the end of the first quarter of this year (2021),” a period in which the sheriffs would have long auctioned the properties.
President of the Umbrella for Democratic Change (UDC) Duma Boko’s alliance with former President Lt Gen Ian Khama continues to unsettle some quarters within the opposition collective, who believe the duo, if not managed, will once again result in an unsuccessful bid for government in 2024.
While Khama has denied that he has undeclared preference to have Boko remaining as leader of UDC, many believe that the two have a common programme, while other opposition leaders remain on the side-lines.