The case between Botswana Public Officers’ Pension Fund (BPOPF) and Capital Management Botswana (CMB) has now taken a legal turn, with BPOPF dragging CMB before the court of law. The case was before the Gaborone High Court on Friday and it is likely to be a marathon case.
At the centre of the case are attempts by the BPOPF to recover P477 million from CMB in the form of assets and cash. It is arguing that the investments made are not in tandem with the agreed investment policy. The most recognized local face behind CMB is Rapula Okaile and he has partnered with South African businessmen. CMB is determined to fight off suggestions by the BPOPF, if the case does not go in the latter’s favour, public servants will be the biggest losers.
But CMB has forced BPOPF to start arguing preliminary matters first. In the active case, the applicant BPOPF is seeking a verdict that they be determined the rightful party to terminate contract with CMB and take over the assets. And on the other hand CMB contends that they are the right party to terminate the contract, not the other way round. This followed an exchange of letters of termination of contract between the two parties a month ago.
BPOPF had three weeks ago written to CMB terminating their contract for persistent breach of the obligation in managing and handling of the funds which they labeled as negligent and an act of misconduct by CMB. They also summoned CMB to return all documentation and assets. In response to this, CMB wrote back to BPOPF a week later that they were actually the ones terminating the contract. Their reason was that BPOPF did not honor the Drawdown notice of Lobatse Clay Works. CMB then deposited P50 million into BPOPF account citing it was net cash. And BPOPF argument was that the money was short of P420 million.
Should the court grant BPOPF the verdict, BPOPF will then get hold of the records from CMB; get the assets back which are at Bona Life, Wilderness Holdings and Cell City; do the audit and get to see the valuation of the record as they are of the view that CMB has misused the funds. BPOPF is also questioning the assets which CMB says they have invested with three other companies namely Kawena, Makuba Airlines and Ajine University. BPOPF says it is not even sure of the existence of the said companies. Kawena was supposed to be a chain of stores competing with Choppies stores according to the records. In the case CMB wins the case, BPOPF will then get nothing from CMB.
The background of the case is that BPOPF entered into an agreement (Advisory and Management Services Agreement 9AMSA) with CMB as the fund of P500 million on 3rd November, 2014. BPOPF at the time committed P500 million. Two years later, BPOPF questioned the way CMB was handling the funds, accusing it of breach of the investment policy. It was then that BPOPF terminated the contract on 30 October, 201, leading to the case before court today. BPOPF also wants all documentation relating to the Fund and to each of the Fund's Investments that are in its possession and which ought to be within its possession in terms of the Partnership Agreement both as its General Partner and Fund Manager.
MOLEFHE HAD SEEN THE SMOKING GUN
This publication learned that when Boitumelo Molefhe joined BPOPF in July 2015 she expressed concern that there were so many loopholes in some of the contracts BPOPF had entered into. She is said to have written to the Board in August 2016 making members aware of the anomalies and the need to take action but she was not successful. Molefhe is said to have asked for a proper valuation of CMB.
Weekend Post is informed that at the time, CMB had only invested in Bona Life. Unfortunately indications are that Molefhe was in her own world as many board members discouraged her from going ahead with the valuation. Board members were convinced that everything looked well and urged Molefhe to let sleeping dogs lie. Sources point out that some went to the extent of scaring Molefhe by telling her that she was putting her position at risk.
“She demanded that her advice be put in writing as a record that she once demanded that this be done but the board was not willing to do so,” said a source close to the developments. At some point Molefhe was accused of being trigger happy because every season she was firing one of the Fund managers. Molefhe is said to have insisted that the board must be vigilant because it was dealing with public money which has to be accounted for. “It is only until recently that she decided to take the bull by its horns and fight this issue of CMB,” said the source.
“People should understand that these are public funds, it is not somebody’s kitchen where they can do as it pleases them,” said a concerned citizen close to the BPOPF on goings. There was an initial back and forth on the subject of whether to terminate CMB or not. But common sense prevailed and the termination was agreed. On the issue of taking the matter to court the Board unanimously agreed. A total of P477m was invested in all the six disputed companies and BPOPF wants it returned. BPOPF is represented by Werkmans Attorneys through the local law firm Minchin and Kelly.
A STAND OUT BREACH
BPOPF is taking a strong exception of the breach of the Provisions Relating to Fund Expenses. It notes that Fund Expenses should be reasonably incurred and duly evidenced and should expressly exclude any placement agent fees. It is said that on 3 March 2016, the General Partner drew down an amount of P12,500,000 representing 2.5% of the Total Commitment which BPOPF understood were in respect of Fund Expenses and Organisational Fees. The Drawdown Notice breached the provisions of the Partnership Agreement by not setting out the allocation to each item.
Fund Expenses must be actually incurred by the General Partner before they are reimbursed. No evidence was provided with the drawdown that such fees were indeed incurred. BPOPF notes that there are caps of 0.25% on each of Fund Expenses and Organisational Fees. It Its concern is that this covers the entire term of the Fund. The capped amount was therefore P2,500,000 over the life of the Fund. Beyond that amount, any expenses of the Fund are to be borne by CMB. The amount drawn down exceeds the capped fees by P10,000,000.
The drawdown was also supposed to cover Management Fees. These are not separately enumerated in the notice but it is noted that the amount of P10,000,000 represents 2% of the Total Commitment whereas the Fund Manager was entitled to 1.5% as a fee. The difference cannot be explained by the reference to cash reserves .
In a classic and shocking case of disgrace and dishonour to this country, the law enforcement agencies are currently struggling to cover up a damaging and humiliating scandal of having conspired to forge the signature of a Palapye Chief Magistrate, Rebecca Motsamai in an unlawful acquisition of the much-publicised 2019 warrant of arrest against Isaac Kgosi, the former director of the Directorate of Intelligence Services (DIS).
The cloak-and-dagger arrest was led by the DIS director, Brigadier Peter Magosi supported by the Botswana Police, Botswana Defence Force (BDF), with the Botswana Unified Revenue Services (BURS) which accused Kgosi of tax evasion, in the backseat.
Umbrella for Democratic Change (UDC) constituent members are struggling to reach an agreement over the allocation of wards for the imminent ward by-elections across the country.
Despite a Memorandum of Understanding (MoU) between Umbrella for Democratic Change (UDC), Botswana Patriotic Front (BPF) and Alliance for Progressives (AP) are said to be active, but the nitty-gritties are far from being settled.
The eight bye-elections will be a precursor of a somewhat delayed finalisation of the brittle MoU. The three parties want to draw a plan on how and who will contest in each of the available wards.
This publication has gathered that the negotiations will not be a run off the mill because there is already an impasse between the Botswana Congress Party (BCP) which is a UDC constituent and AP (currently negotiating to join umbrella).
The by-elections joint committee met last week at Cresta President Hotel in a bid to finalise allocation but nothing tangible came out of the gathering, sources say.
The cause of the stalemate according to those close to events, is the Metsimotlhabe Ward which the two parties have set their eyes on.
In 2019, he ward was won by Botswana Democratic Party’s (BDP) Andrew Sebobi who unfortunately died in a tragic accident in February last year.
Sebobi had convincingly won by 1 109 votes in the last elections; and was trailed by Sephuthi Thelo of the UDC trailed him with 631 votes; while Alliance for Progressives’ Innocent Moamogwe got 371 votes.
Thelo is a BCP candidate and as per UDC norm, incumbency prevails meaning that the BCP will contest since they were runners up. On the other hand, AP has also raised its hand for the same.
“AP asked for it on the basis that they have a good candidate but BCP did not agree to that request also arguing they have a better contestant,” one UDC member confided to this publication.
Notwithstanding Metsimotlhabe Ward squabble, it is said the by-election talks are almost a done deal, with Botswana National Front (BNF) tipped to take Boseja South ward in Mochudi East constituency. Botswana Patriotic Front (BPF) will be awarded Tamasane Ward in Lerala/Maunatlala constituency, sources say.
“But the agreement has to be closed by National Executive Committee (NEC),” emphasized the informant.
The NEC is said to have been cautioned not to back the wrong horse but rather rate with reason and facts.
UDC President, Duma Boko has told this publication that, “allocation is complete with two wards already awarded but with only one yet to be finalized,” he could not dwell into much details as to which party got what and the reasons for the delay in finalisation.
Chairperson of the by-elections committee, Dr. Phenyo Butale responded to this publication regarding the matter: “As AP we contested and as you may be aware we signed the MoU with UDC and BPF to collaborate on bye-elections. The opposition candidate for all bye-elections will be agreed by these parties and that process is still ongoing,” he said when asked if AP is interested on the ward and how far with the talks on bye-elections.
Butale, a former Gaborone Central Member of Parliament, who is also AP Secretary General continued to say, “As the chairperson of the bye-elections committee we are still seized with that matter. We should also do some consultations with the local structures. Once the process is complete we will issue a notice for now we cannot talk about the other two while the other is still pending the other one”.
Butale further clarified: “There is no such thing as AP and BCP not in agreement. It is an issue of signatories discussing and determining the opposition candidates across the three wards.”
Apart from the three wards, there are five more council wards that UDC is yet to allocate to cooperating partners.
FROM PALAPYE MEET: BPP CAUTION NEC MEMBERS
With the UDC cheerful from last weekend’s meeting in Palapye, the meeting however was very tense on the side of both BCP and BNF, with only BPP flexing its muscle and even lashing out.
BCP going into the meeting, had promised to ask difficult questions to the UDC NEC.
BCP VP and also acting Secretary General, Dr. Kesitegile Gobotswang, presented their qualms which were addressed by UDC Chairperson Motlatsi Molapisi, informants say.
It is said Molapisi is fed up and concerned by some UDC members especially those in the NEC who ‘wash party’s dirty linen in public’.
Insiders say the veteran politician cautioned the NEC members that they “will not expel any party but individuals who tarnish the image of the UDC.”
It is not the first time BPP play a paternalistic role as it once expressed its discontent with BCP in 2020, saying it should never wash UDC linen in public.
At first it is said, BPP, the oldest political formation in Botswana, claims disappointment on BCP stance that UDC should be democratised especially by sharing their stand with the media. Again, BPP was not happy with BCP leader Dumelang Saleshando’s decision to air his personal views on social media regarding the merger of UDC party.
Botswana Police Service (BPS) Commissioner, Keabetswe Makgophe, has of late been dousing raging fires from various quarters of society following the infiltration of the police fingerprint system by the Directorate on Intelligence and Security (DIS), WeekendPost has learnt.
Fresh information gleaned from a number of impeccable sources, points to a pitiable working relationship between the two state organs. Cause of concern is the DIS continuous big brother role to an extent that it is now interfering with other institutions’ established mandates.
BPS which works closely with the DIS has been left exasperated by the works of the institution formed in 2008. It is said, the DIS through its Information Technology (IT) experts in collusion with some at BPS forensics department managed to infiltrate the Fingerprint system.
The infiltration, according to those in the know, was for the DIS to “teach a lesson” to some who are on their radar. It is said the DIS is playing and fighting dirty to win the fights they have lost before.
By managing to hack the police finger print system, a number of renowned businessmen and other politically exposed persons found their fingers in the system. What surprised the victims is the fact that they have never been charged of any wrongdoing by the police and they were left reeling in shock to learn that their fingers are on the data-base of criminals.
In fact, some of those who their fingerprints were falsely included in the records of those on the wrong side of law learnt later when other errands demanded their fingerprints.
“We learnt later when we had to submit and buy some documents and we were very shocked,” one politician who is also a businessman confided to this publication this week.
“We then learn that there are some fabricated criminality recorded for us, as to when did we commit those remained secret to the police, but then we had to engage our lawyers on the matter and that is when we were cleared,” said the politician-cum- tenderpreneur.
The lawyers have confirmed engaging the police and that the matters were settled in a gentlemen’s agreement and concluded.
All these happened behind the scenes with the police top brass oblivious only to be confronted by the irked lot, police sources also add. The victimized group who most of them have been fighting lengthy battles with the DIS read malice and did not blink when it was revealed that these were done by the DIS.
“And it was clear that they (DIS) are the ones in this dirty war which we don’t understand. Remember when we sue, it will be the Police at the courts not the DIS and that is why we agreed to a ceasefire more so they also requested that be kept under carpet,” said the victim.
Nonetheless, the Police through its spokesperson Assistant Commissioner, Dipheko Motube, briefly said: “we do not have any system that has been hacked.” On the other hand DIS mouthpiece Edward Robert was not in office this week to comment on the matter.
Reports however say DIS boss, Peter Magosi, who most of the victims accuse of the job, is said to have met his police counterpart Makgophe to put the matter to bed.
COVID-19 RAVAGES POLICE
As frontline workers, Police have not escaped the wrath of Covid-19. Already the numbers of those infected has reached the highest of high and they suggest that they be priorities on vaccine rollout.
“Our job is complicated, firstly we arrest including those who are non-compliant to Covid protocols and we go to accidents and many more. These put us at risk and it seems our superiors are not bothered,” said one police officer this week.
The cops further complain about that working spaces are small, as such expose them to contact the virus.
“Some tests positive and go for quarantine while the rest of the unit will be left without even test carried out. If at all the bosses are serious all the police officers should every now and then be subjected to testing or else we will be no more because of the virus,” added another officer based in Gaborone.
The government has since placed teachers on the priority list for the vaccines, it remains to be seen whether the police, who also man road blocks, will be considered.
“But our bosses should convince the country leadership about this, if not then we are doomed,” concluded a more senior officer.