Capital Management Botswana (CMB) Chief Executive Officer, Rapula Okaile has taken the Directorate on Corruption and Economic Crime to court demanding back his seized assets.
Okaile’s push back against the DCEC follows a dramatic week in which the corruption buster detained his wife and impounded some of his assets. DCEC launched an investigation against Okaile and CMB following a report by Botswana public officers Pension Fund.
BPOPF reported CMB to the DCEC for allegedly breaching an agreement in Botswana Opportunities Partnership (BOP) – an equity partnership between the two entities. The Fund also accused the asset manager of engaging in suspicious transactions. Despite efforts by BPOPF to convince CMB to return its assets, the latter insists that the Fund no longer has shares in BOP.
In his letter to the DCEC, a copy of which has been passed to the Sunday Standard, Okaile states that “I refer to the Botswana Opportunities Partnership and the investigation currently being carried out by yourselves, at the behest of Boitumelo Molefe, CEO of BPOPF.”
He further states that “We also for the record take note that Regina Vaka, CEO of Bona Life, separately made various false allegations against ourselves, which she subsequently in writing noted had been dealt with.”
BOP has shareholding in Bona Life which is an insurance life company. Bona Life’s policy holders are predominantly members of the BPOPF.
Okaile said while the BPOPF was part of BOP, CMB acquired shares in five different companies for the benefit of BOP.
“The legal modus operandi was that CMB would identify an investment opportunity, engage with the owners of that company which represented the investment opportunity and then make an offer,” he said.
Okaile said this offer and the analysis of the investment opportunity was submitted to the independent Investment Committee of CMB and upon approval, the minutes and drawdown notice were submitted to the BPOPF which then made a payment to BOP’s bank account.
“The payment was then directed to the company to be invested in the manner as agreed between CMB and the investment company. For example, the P50 million invested into Bona Life was directed to be invested as capital in Bona Life,” said Okaile.
He said Bona Life took the P50 million it was given and in turn gave it to outside companies so that it could be invested and earn interest for Bona Life.
“Some of that money was for example given to Bank of Botswana. Bona also considered investing in some money with Don Gaetsaloe’s Confianza Capital,” he said.
He said in the case of CellCity, the owners wanted to sell 50 percent of their shares and received the money in their personal accounts adding that the money was not paid to CellCity’s own bank account.
Regarding investment in another entity called, Makuba, Okaile said the company was directed to use the funds to pay for corporate advisors to build its business further.
Regarding investment in Kawena, Okaile said the company wanted the money invested in Botswana as it at the time wanted to use the money to develop its network.
He said another company, Agile, similarly wanted its funds invested. “Both elected to invest their funds in assets held by CMBF1. Kawena and Agile were therefore paid into the bank account nominated by them and in exchange, BOP received the share certificate and other arrangements giving BOP its share ownership of the two companies,” he said.
CMBF1 is a wholly owned subsidiary of CMB and it specialises in private equity management.
“Please note that in terms of the Botswana Companies Act (42:01) a company is controlled and directed by its Board of Directors, not its shareholders. The Board of Directors decided how a company is to be run and in what manner. The same Board has the power to direct the use of its resources, not the shareholders,” said Okaile.
He said legal liability for any actions taken by the directors rests with the directors. Shareholder liability is limited according to their share of the capital structure of the company.
Okaile also said that “The legal entities that currently have locus standi with respect to the investments in CMBF1 are shareholders of CMBF1, Bona Life, Kawena and Agile. Neither Molefe nor the BPOPF are one of those.”
“It is unfortunate that the complainant, being a financial professional and being ignorant of the law, has chosen to make the various false allegations. It is even more unfortunate that these complaints have been pursue with the amount of vigour they have been, with no proper process being followed to ascertain the correctness of these allegations,” he said.