Thursday, October 28, 2021

Isaac Kgosi’s name crops up in money laundering probe

Mystery surrounds how  P250 million that was intended for the construction of fuel storage tanks for the DIS (Directorate of Intelligence and Security) ended up in Israel, attracting the attention of financial watchdogs like Financial Intelligence Authority (FIA), Bank of Botswana, Capital Bank  as well as the United States based financial agencies that monitor fraud.

The transaction piqued the curiosity of the financial watch-dogs which uncovered a rash of suspicious transactions, a web of interconnected companies with cross shareholdings and intrigues snowballing into money laundering criminal charges against some of Botswana’s prominent investment executives and a huge scandal that has stunned the whole country.

A cabinet minister found himself volunteering to depose a statement to the corruption busting agency, DCEC (Directorate on Corruption and Economic Crime) with a clutch of some of the country’s renowned investment executives spending a few days in jail.

They are currently on bail facing multiple charges relating to money laundering.

The money had initially been requested by head of DIS, Isaac Kgosi to build fuel containers for security agencies but ended up transferred to Israel to pay for military, anti-poaching and surveillance equipment.

On August 2017, Kgosi wrote a confidential Savingram to the then Director of Energy Department, Kenneth Kerekang requesting a total of P250 million to be used in the construction of Petroleum Storage Facilities.

“The objective of constructing and maintaining the facilities,” wrote Kgosi “is to ensure that there is continuous supply of petroleum products for the essential Services of the Government.”

Sunday standard has turned up a paper trail showing that the new facilities were meant to add to the already existing DIS fuel storage tanks in Selibe Phikwe, Francistown, Gaborone and Lonetree.

But immediately upon approval the purpose of the money was changed.

Instead the money ended up in Israel to buy military equipment from what Government insiders say was an uncertified supplier ÔÇô an allegation strenuously denied by DIS.

“Currently the facilities are owned and operated primarily by the Directorate of Intelligence and Security Services. However there is a need to expand the facilities to include other essential organs of the Government especially during petroleum supply disruptions,” added Kgosi in his initial motivation.

He added that new potential sites for such facilities had already been identified at Lobatse, Mahalapye, Maun, Nata, Gaborone and Lonetree.

“We therefore kindly request for the release of BWP 250 million for the detailed design and construction of some sites of the proposed projects.”

The same day the Director in the Department of Energy, Kenneth Kerekang wrote back to Kgosi to say the P250 million had been approved.

“Please be informed that your request has been acceded to and be assured that the funds P250 million) has been reinfenced (sic) from the National Petroleum Fund and will be released as per your request. The National Petroleum Fund is managed by a company owned by Bakang Seretse and Botho Leburu.

In what comes across as conflict of interest, the money was to be deposited into the account of DISS Fund Managers Kgori Capital whose Managing Director is Bakang Seretse.

“You are therefore requested to access the funds directly through our Fund Manager whose details are outlined below: Managing Director, Kgori Capital (Pty) Ltd, Private Bag 1253, ABC Sebele, Gaborone…”, states Kgosi in his letter to the Department of Energy.

A copy was sent to Bakang Seretse, the Managing Director of Kgori Capital.

The following day on the 8th August, 2017, Bakang Seretse waded into the conversation by a letter under the letterhead of Khulaco Management Services written to the Department of Energy.

Investigations have shown that Khulaco is a front company that forms part of a suite of companies owned by the DIS but managed independently by legitimately registered investment companies.

The listed directors of Khulaco Pty Ltd are Bakang Seretse and Botho Leburu.

“… We thank you for your instruction. We advise that our fees in relation to the management and disbursement of the funds would be an up-front fee of 20% [P5 million] of the total Funds disbursed/allocated,” wrote Seretse.

“We would require a meeting with yourselves and the Directorate of Security and Intelligence to understand how the Funds are to be disbursed and or ring fenced. In addition we would require an understanding of the projects being undertaken and issues relating to accountability, reporting lines and ownership of the Funds to be disbursed are to be addressed.

Two days later on the 10th of August 2017, P250 million was disbursed from the National Petroleum Fund to the bank account of Khulaco Pty Ltd, account number 0002704015955, Capital Bank, Main Branch.

Hardly a month after the money was paid the Director General of DIS, Isaac Kgosi changed tune on what the money was originally supposed to be.

He wrote a letter to Permanent secretary in the Ministry of Minerals stating that priorities have since changed following the new security threats that the country was facing.

“…following our allocation of P250 million we have been continuously assessing reports and closely monitoring the country’s dire threats in conjunction with our “Intelligence National threat assessment Document.” Our assessment has since revealed that the greatest threats to the security of our economy is the intensified wildlife poaching, human and drug trafficking. Monitoring of these threats requires sophisticated security equipment and advanced surveillance capabilities. In light of the above, we request for variation of the intended usage of the approved BWP 250 million to acquisition of security and surveillance equipment in order to address this detrimental threat to the country’s economy,” wrote Isaac Kgosi.

The request was approved the following day by acting Permanent Secretary in the Ministry of Minerals, Dr Obolokile Obakeng.

The variation and diversion of funds as approved goes against the stipulated guidelines of payment from the National Petroleum Fund.

The money was diverted after Public Procurement and asset Disposal Board had declined a request by DIS head to directly appoint design and construction of the storage tanks without going for tender.

Both Seretse and Leburu together with Kerekang are facing charges of money laundering.

Cabinet minister, Sadique Kebonang has deposed a voluntary affidavit to the DCEC as a way of easing mounting public suspicions against himself.

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