Gaborone City Councillors have resolved to cancel a P8, 4 million surety mortgage bond in favour of Stanbic Bank, securing a loan advanced in 2004 to Market Development Company, to develop the Gaborone Station Plaza.
This follows legal advice by Principal State Counsel, Linchwe Tlhowe, that “it appears that the bond was fraudulently obtained”.
Councillors were warned that in the event Market Development Company (MDC) failed to service its loan to Stanbic, the bank had the right to sell Gaborone City Council (GCC) land which has been lodged as surety.
Councillors were also informed that although the city council has leased only one plot to MDC, the surety mortgage bond covers three other plots from which the council does to levy rental.
It further emerged that no formal application was made to lease the three other plots, suggesting that they may have been improperly allocated, closing out other developers who may have been interested in leasing them.
Councillors were briefed that, on 25th and 28th October 2004, the Finance Committee agreed to apply for a consolidation of all four plots.
“It is important to note that the consolidation of the plots has not been done. Furthermore, the plots have been informally consolidated and developed as if they were consolidated. Rental is being received from MDC for only one plot.”
Councillors agreed to review the lease agreement with MDC to address the issue of three other plots from which the company is charging tenants rentals but is not paying the city council any rental for them.
It emerged during the meeting that MDC has in response offered to have the P8,4 million bond cancelled and that the council should instead allow them to register the lease with the Registrar of Deeds to enable then to secure a loan with the lease.
In an interview with The Sunday Standard, the managing director of Market Development Company (MDC), Isang Gabegwe, said he was not aware that GCC was contemplating to cancel the P8, 4 surety mortgage.
“They approved it in 2002…I can’t bond without approval of council…People who are querying this thing are mostly people who were not there at the time,” said Gabegwe.
He acknowledged that the pieces of land have not been consolidated despite a council resolution, which he said was passed some years ago. He said that it was clear that officials have slept on the job as the land should long have been consolidated.
“That project has changed so many people’s lives .This project has transformed so many people’s lives, rather than applauding, they chose to go back eight years down memory lane as if council is not being paid,” he added.
In a curious turn of events, a day after City Clark Agnes Seragi and the council legal advisor briefed councilors, the post for city council clerk was offered to Mr Wadza Tema.
The Sunday Standard has in its possession an offer letter to Tema signed by Permanent Secretary in the Ministry of Local Government, Thato Raphaka, dated September 8th.
Another letter passed to Sunday Standard reveals that Raphaka informed the City Clerk of plans to transfer her to Molepolole two days after offering Tema the post of Gaborone City Clerk.
In a subsequent letter dated September 16th to the city clerk, Raphaka states: “Reference is made to the subject matter, in particular our meeting held on Friday 10 September 2010 regarding the same matter.
