24 Nov 2019

Alliance for Progressives (AP) leader and former Gaborone Bonnington South MP Ndaba Gaolathe says the P1 333 328 credited to him from the Capital Management Botswana (CMB) account was payment for consultancy work he had done as a strategic partner at Fleming Asset Management. 

CMB is currently at the centre of a legal tussle over the alleged misappropriation of pension funds handled by the firm. 

At a creditor’s hearing held at the High Court in Gaborone recently, it was revealed that Gaolathe was paid the amount in eight batches of P166 666 between May 29, 2017 and January 10, 2018. 

Testifying before Master of the High Court, Chipo Gaobatwe, Gaolathe explained that he had always acted in good faith in offering professional services, which merited due remuneration and was unaware of any controversy surrounding the payments. 

Detailing how, having set up a private equity fund in 2007, Gaolathe said he ‘stablished a professional relationship’ with Marsland then, whom he described as ‘an expert in fixed equity’. 

They often worked together at the Botswana Insurance Fund Management (BIFM), Gaolathe explained. 

He said the relationship was revived a decade later, when he entered into a strategic partnership agreement with Fleming Asset Management Botswana, which had been acquired by Marsland’s Capital Management Africa (CMA) in 2017. 

Having been enticed by CMA’s ambition of creating a Pan African business service, Gaolathe said he had made it clear that owing to his involvement in opposition politics, he did not want to handle any government contracts or public funds. 

An investment holding company specialising in private equity management, CMA is owned by Marsland, who is also the majority shareholder of local asset management subsidiary CMB, which he runs together with fellow director and minority shareholder Rapula Okaile. 

Court papers claim that former Botswana Public Officers Pension Fund (BPOPF) board chairperson, suspended Permanent Secretary to the President Carter Morupisi, on 11 November 2014, as BPOPF board chair, acting without the authority of the board, signed a contract authorising CMB to administer BPOPF funds. 

An initial P500 million of BPOPF funds were managed by CMB, but allegations of misappropriation led to Non-Bank Financial Institutions Regulatory Authority (NBFIRA) placing the firm under statutory management. 

Statutory manager Peter Collins had laid out evidence of large scale misappropriation of BPOPF millions before court and recommended that CMB be placed under liquidation, which led to the credit hearing. 

Gaolathe said he was under the impression that the payments he got were from Marsland’s stable of companies and never associated them with BPOPF. 

Under cross-examination by Sipho Ziga of Armstrong Attorneys, representing the liquidator, Gaolathe said he did not have proof of his contract with Fleming Asset Management and was still looking for the hard copy. Peter van Riet-Lowe, former Fleming Asset Management chief executive officer (CEO), said the company had managed the assets of many companies, including BPOPF, at its peak handling some P14 billion’s worth. 

When Fleming Botswana was still owned by 21^st Century Holdings through Robert Fleming Botswana Holdings and Starfish Private Limited, van Riet-Lowe was the biggest shareholder. 

He said their biggest foreign exchange trading client at the time, Stanbic Botswana, through then managing director Leina Gabaraane, made representation to BPOPF CEO Boitumelo Molefe and then Fleming board chairperson Charles Tibone, seeking to use Fleming for trading. 

Van Riet-Lowe said no client capital had been used for trading at the time. 

He said after his resignation following the sale of Fleming early 2017, all the funds credited to him from CMA and Tim Marsland were for the sale of shares. 

Meanwhile, Okaile, who has been subpoenaed, did not turn up and his attorney Mpho Garebatho pleaded that his client be excused as he was writing examinations in partial fulfillment of his Masters in Business Administration (MBA) requirements. 

Advocate Stefan Vivian of the Pretoria Bar, who represents BPOPF, was less than impressed, stating that ‘millions of public funds disappeared under Okaile’s watch’, as such he had to make the effort to appear, especially since the said examinations were taking place at night. 

While agreeing that Okaile should have had the courtesy to be present, Master of the High Court Gaobatwe still allowed Okaile’s exemption until the next hearing in March 2020. Ends