Sunday, April 21, 2024

BPOPF illegally entered into billions of Pula contracts ÔÇô says lawyers

The Botswana Public Officers Pension Fund’s recent decision to sign contracts with asset managers violated a High Court order which barred the Fund from engaging in any business transaction before all board of trustees are duly appointed ÔÇô Sunday Standard has been informed.

It is understood that at its Board of Trustees meeting in Maun recently convened by Chairman Carter Morupisi, it was revealed that BPOPF had signed billions of Pula worth of contracts with asset managers recently. 

However, these activities ran afoul of the October 2014 High Court Order by Justice Tshepo Motswagole that “no further business of board of trustees of (BPOPF) shall be carried out until the terms of this settlement agreement have been duly complied with.” ┬á

The order arose from a case in which Manual Workers Union took BPOPF and Morupisi to Court seeking certain orders among them a review of the fund’s decision to exclude union members from the board of trustees.

The terms of the settlement are that all employees of the association or trade unions shall on or before the 20th October 2014, at the boardroom of BPOPF, review nominations submitted to the secretariat and nine persons (some from Unions) with the highest number of nominations shall be taken as duly appointed trustees.

Sunday Standard can reveal that BPOPF ignored the High Court order and continues “to carry out business of board of trustees” without members from unions.

The Manual Workers Union, through its lawyers, Rantao and Kewagamang Attorneys set the tone for the challenge of the legality of the contracts that BPOPF entered into with fund managers when it filed a notice of intention to sue Non Bank Financial Institutions Regulatory Authority (NBIFRA) and Morupisi. 

In a letter to NBIFRA which was also copied to the Principal Officer of BPOPF, the Union states that in or before December 2014, its nominated members, Maophala Bogosi and Bethobatsile Otsile were delivered to NBFRA offices for approval as trustees under section  69 (1) of the NBIFRA Act.

“We are instructed that to date you have not advised the two persons of the outcome of their approval applications, although many other persons submitted to you pursuant to the court order have been approved,” said the lawyers.

The lawyers claim that the failure to advise their client of their status as employee trustees is overwhelming.
“The business of the fund continues to be transacted in their absence even though they have to be trustees on behalf of tens of thousands of members of the fund. On 19 February 2015, a Board of Trustees meeting was convened by Chairman of the Board Carter Morupisi in Maun. Our clients understand that far reaching resolutions were made in the absence of our said employee trustee clients including in respect of tenders/ contracts with third parties sounding in multi million Pula,” state the lawyers.

They argue that documents of the same meeting “show that you have positively vetted nine trustees but the current position in respect of Mrs Mokgosi and Mr Otsile was not stated other than that they have not been vetted.”

“Not only is the dilatory vetting process prejudicial to our clients, it also has the effect of frustrating court order because the business of the Board of Trustees continues to be transacted in the absence of our employee trustee clients contrary to the spirit to the letter and court order, ” say the lawyers.

They issued a warning that: “you revert to our clients in respect of their request for approval on or before 17 March to obviate the need for our client to approach the High Court on urgency for an order that you act accordingly.”

Contacted for comment on Friday, Morupisi said that BPOPF had not violated any High Court order insisting that it continues to carry out transactions within the law. When further asked why business of the fund continues to be transacted in the absence of other board of trustees, Morupisi insisted that “that they are there. Some are just waiting for vetting by NBIFRA. The problem is that you don’t understand the court order.”

However, Manual Workers Union’s lawyer Tshiamo Rantao said his clients are “considering citing Morupisi for contempt of court so that he is sent to jail.”

“He convened a meeting when he is aware that some board of trustees are yet to be approved by NBIFRA. He ought to have found out when approval of trustees’ application will be completed before convening meetings in terms of the rules of the Fund. Morupisi is the one who does not understand the Court Order and he quite clearly is in contempt of court,” said Rantao.

According to Rantao, his clients would also in future strongly consider whether or not to approach the High Court to challenge the legality of the transactions between BPOPF and third parties running into millions of Pula.

“We will consider whether to challenge the recent board meetings for which my clients were not notified of because they had it on good authority that resolutions on transactions with third parties running into millions of Pula were made pursuant to invalid meetings which were convened by Morupisi,” said Rantao.


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