14 Jun 2018

 Parliament has welcomed the proposal of the Trust Control Bill, which seeks to regulate the control and administration  of trusts.

Presenting the bill, Minister of Defence, Justice and Security, Mr Shaw Kgathi said the bill was necessary because currently there was no statutory law regulating the control of trusts in Botswana.

He said it should be mandatory for every accountable institution to have relevant documentation explaining their purposes and objectives as well as to provide proper financial records and statements with detailed expenditure breakdowns.

Mr Kgathi further said that the proposed bill would require all trusts, trustees and details of beneficiaries to be registered with the master of the High Court, adding that any illegal irregularities in relation to the administration of the trust shall also be filled with the master of the High Court.

The absence of trusts regulating laws, he said, meant that there was minimal vetting and control of trusts and similar legal arrangements.

He said it created possibilities of money laundering scams on which illegal activities could be disguised.

While some trusts could be set up legitimately, minister Kgathi said there were those which could be used intentionally for money laundering and terrorism finnacing activities. “An environment where trusts are not subjected to accountability and transparency requirements can facilitate undesirable result,” said Mr Kgathi.

In his contribution to the bill debate, Member of Parlimant for Thamaga/Kumakwane, Mr Tshenolo Mabeo said the bill was long overdue, stating that funds had been mismanaged at community trusts which lead to the collapse of such trusts.

Mr Mabeo said the proposed bill was welcomed as it would oblige trusts to be accountable towards their funds and assets.

He said assets accountability  was essential to the sustainability  of community trusts, adding that a number of community trusts had collapsed  due to lack of accountability  and mismanagement of funds.

Kopong/Lentsweletau MP, Mr Vincent Seretse said some trusts board members had a tendency to abuse the powers conferred on them, something he hoped  the proposed bill would address.  

He said the bill should also emphasise the need for board members to possess some level of competence that would benefit the trust.

He added that transparency, accountability and openness should be in place.

Molepolole South MP, Dr Tlamelo Mmatli also applauded the proposed bill, saying it would guard against the misuse of trust funds, and hold trustees accountable as they would be mandated to submit audited reports when required.

He said the bill would also ensure that trust funds benefitted their intended recipients. ENDS