Botswana’s oldest short-term insurance company, Botswana Insurance Company (BIC), a subsidiary of Zimbabwe’s TA Holdings is being investigated over its incestuous business relations which steer business away from local investors to a network of associated foreign companies and individuals.
BIC and its holding company TA Holdings are part of Zimbabwe’s President Emerson Mnangagwa’s alleged oligarch, Shingai Mutasa’s huge empire.
Seven years ago, Mutasa’s Masawara Plc bought TA Holdings which was listed on the Zimbabwean Stock Exchange and took it out of the public glare, enabling the BIC holding company to carry out its business in secrecy.
The delisting of the company from the Zimbabwean stock exchange in 2015 means now BIC does not have to disclose its related party transactions as per requirements of the Zimbabwean bourse.
At the center of the current shady business dealings which are the subject of an investigation by the Competition and Consumer Authority (CCA) is BIC and its Chief Executive Officer Newton Jazire.
The key question is whether those business interests bias BIC’s advice to clients. The Sunday Standard can reveal that Jazire and BIC have tilted the playing field and steered company clients’ business away from Botswana citizen companies, to a network of associated foreign companies and individuals – in a hand to hand business relationship that is believed to be emblematic of the company’s flawed related party transactions reporting system and weak governance controls.
Jazire who is the CEO of Botswana Insurance Company is also a director in Claims Assessing Bureau Propriety Limited which monopolizes the company’s short-term insurance damage assessment business. Those two positions strung together in the same sentence may make some people uneasy, but this is just the tip of the iceberg. Worse still, Claims Assessing Bureau is in partnership with South Africa’s Autoboys in a company called Parts Portal (Pty) Ltd. Autoboys is a provider of automotive parts and glass repair services intended for the automotive insurance sector, workshops, and individual customers. The company offers automotive glass repair and replacement, spare parts, painting jobs along with vehicle inspection services.
Shareholders of Parts Portal (Pty) Ltd are auto parts and glass specialist Autoboys Pty Ltd and Claims Assessing Bureau (Pty) Ltd, with shares allocated as follows: Nandini Patel allocated 440 shares, Autoboys International 960 shares and Claims Assessing Bureau allocated 600 shares.
The directors of Parts Portal Proprietary Limited are Nandini Patel and a Chinese national Filum C Ho who resides in Midrand, South Africa. Filum Ho is the CEO of Autoboys South Africa. Sunday Standard has turned up information that BIC has instructed panel beaters repairing their clients’ vehicles to buy all spares from Autoboys. The conflict of interest is so
ubiquitous that a source close to the shady dealings remarked that: “The guy who’s calling balls and strikes should not be a shareholder in one of the teams.”
Is TA Holdings and its boss Shingai Mutasa aware of what the company and its local principals are up to?
While Jazire and Kago Kimane are directors of Claim Assessing Bureau, the shareholder is Botswana Insurance Company with a share allocation of 3657550. Proceeds from the companies make part of the TA Holdings’ profits. Besides, Mutasa also has fiduciary responsibility over the company as BIC board chairperson.
Mutasa is considered one of the richest black businessmen in Zimbabwe and has a long history of deal-making, dating back to the early years of independence.
The tycoon has interests in agrochemicals, hospitality, insurance, and investment management in Zimbabwe and three other African countries. Mutasa studied in the UK and returned to Zimbabwe at independence in 1980 to join a commodity-brokerage family business.
In 2010, Mutasa registered a new investment company, Masawara plc, in Jersey. The new firm bought TA Holdings, delisted the company and renamed it Masawara Zimbabwe, where he is the chief executive officer.
In the insurance sector, Masawara controls Zimnat Lion Insurance, Zimnat Life Assurance, Grande Reinsurance and Minerva Risk Advisors. During the same year, Masawara bought BP Shell’s local franchise and renamed it Zuva Petroleum. The deal went through despite opposition from black economic empowerment groups.
The BIC incestuous business relationships in Botswana are currently being investigated by the Competition and Consumer Authority (CCA) for possible anti-competitive behavior.
This follows information from whistleblowers that the network of BIC associated companies has captured the Botswana’s short-term insurance industry.
This publication is in possession of some letters from Hollard Botswana and BIC directing clients to buy parts specifically from Autoboys Botswana.
In one of the letters authored by BIC, the insurance company says “kindly find the attached repair order as per subject matter.”
The letter added that, “Note that the parts will be delivered by Autoboys to commence repairs and that the contributions which is to be paid by client is for outstanding premiums.”
Another letter from Hollard Botswana reads thus, “Instructions/notices to all repairers-acceptance of this order bind the repairer to Hollard insurance code of conduct which will include your agreement to follow our Hollard business policy and failure to agree or confirm with the offer or clients repairs on these business procurement policies we will ensure to uplift the vehicle and direct the required repaired work elsewhere to a panel repairer aligned with the policy.”
Comments were not immediately available as BIC, in a written response, indicated that Jazire was outside the country.
Competition Authority Chief Executive officer Tebelelo Pule and her team of investigators have also been keeping tabs on Botswana Insurance Company (BIC).
Other insurance companies under the CCA radar are Hollard Insurance Botswana and AoN Botswana (Pty) Ltd.
Competition and Consumer Authority Communications Manager Gideon Nkala confirmed the investigations.
Nkala said there is an ongoing investigation following anti-competitive conduct complaints in the insurance sector.
He further confirmed that the investigation surfaced as a result of a complaint of anti-competitive conduct lodged with CCA in the panel beating-insurance sector and that this is what we are currently seized with at the moment suffice to add that it is an engaging investigation.
BIC directors are Shingai Mutasa, and Lawrence Kupe, amongst others.
