Non-Bank Financial Institutions Regulatory Authority (NBFIRA) Mission statement is ‘To regulate and supervise Non-Banking Financial Institutions for the purpose of contributing towards financial stability’. Regulatory agencies are defined as ‘governmental or quasi-governmental bodies that establish, monitor, and enforce laws within their area of responsibility’. Some of the responsibilities of monitoring and enforcing laws would be but not limited to issuing and managing licences and permits of the applicants of would-be companies and imposing punitive sanctions as and when appropriate or desirable. If the institution was true to its Mission statement, a bogus company known as Bluthorn Fund Managers (BFM) would not have received a Thebe from anybody let alone government controlled institutions like District Councils and Civil Society Organisations like trade unions.
In the process, these institutions and organisations have cumulatively lost over an estimated P 300 million under the watch of NBFIRA. From the look of things, this money potentially, may not be recovered to compensate the affected parties. And to imagine that money lost by the Councils was supposed to improve the dire socio-economic circumstances of Batswana in more ways than one in terms of service delivery is sickening to say the least. Punitive action should be taken against the leadership of NBFIRA on one hand, and the employee(s) whose duty was to ensure that BFM operates in Botswana in strict compliance of NBFIRA Act.
NBFIRA is a body corporate established by an Act of Parliament. Taking the line Minister out of the way for a minute, it has a board of directors and executive management. I want to believe it has in-house lawyer(s) whose duties are obvious. The first question I ask myself is: how did NBFIRA find itself in circumstances where a bogus company will be so brave to set up shop and in the process siphon millions of Pula from should I say, unsuspecting investors with NBFIRA seemingly, in the dark? Not only that, it appears red flags were raised when the activities of this bogus company appeared dubious yet it has emerged, no action was taken to prevent more damage in terms of and most importantly, Councils and trade unions ‘investing’ in a bogus-cum-pyramid scheme.
Next is the Board of Directors who seemingly, failed to play its requisite role as expected of such a structure. Was the Board not aware of a bogus company called BFM? If it did, what did it do to address the situation? What did a Board sub-committee responsible the registration and supervision of companies falling under the mandate of NBFIRA do? Lastly comes in the executive management. Similar questions like those directed at the Board would broadly apply because executive management is charged with the day-to-day management of NBFIRA. It is operational!
It is important to mention that people who serve in the above structures-lawyers, members of both the Board and executive management are not your ordinary folks on the street who can be called through a whistle to come and do piece jobs in our homes and dimausu (tuck shops). These are men and women whose CVs suggest they are able to work anywhere in the world owing to their impressive academic and other credentials to their names. For example, Section 8(1) of the NBFIRA Act on the Qualifications, Removal and Suspension of Board members provides that ‘The Minister shall not appoint a person to be a member in terms of Section 5(2)(c) unless satisfied that the person is qualified for appointment by virtue of his or her knowledge of, or experience in, one or more of the following fields-(a) business; (b) financial markets; (c) financial products and financial services; (d) financial or commercial law; (e) economics and; (f) accounting’. Section 8 (2) provides that ‘A person shall not be appointed as a member or be qualified to continue to hold office where the person- (i) has been adjudged or otherwise declared bankrupt and has not been discharged, or…. (b) has within a period of 10 years immediately preceding the date of his or her appointment, been convicted (i) of a criminal offence within Botswana , or (ii) outside Botswana, of an offence which if committed in Botswana, would have been a criminal offence….’.
As can be observed from the foregoing, the bar for persons who serve on the board of NBFIRA is so high that if persons appointed thereto fit the fit and proper requirement to meet the stated criterion, there should be no glaring if not numerous margins of error for a bogus company and others to come near its offices. It will be remembered there is the FirstCred scandal where NBFIRA appears to be playing a watching brief role as opposed to that of a regulator’s. It also appears it plays a reactive role as opposed to a proactive one. In short, there is no reason imagined or real for over an estimated P 300 million to have been lost consequent to some omission or commission on the part of NBFIRA. If this is the case, there is no reason why it exists.
The story of this bogus company facilitated by some Batswana has been in the news for a while now wherein it could even register Directors without such Directors signing a single document to that effect. High profile individuals including a former cabinet minister were reportedly paid around P 50,000.00 a month for doing absolutely nothing and in compliance with the law. A former Council Chairman is said to have been paid the same amount and when these individuals were asked to say what they were paid for, no convincing answers were provided. Ironically, when these payments were in full swing, these fellows were still Botswana Democratic Party members. I am not sure whether the former Minister is still a member. What is known is that the former Council Chairman was a campaign manager for President Masisi’s faction at the Tonota elective congress where cash was dished out to faction members. Is it far-fetched to imagine part of such cash was derived from BFM? Your guess is as good as mine.
The Minister responsible for NBFIRA interestingly I believe, is the Minister of Finance who by virtue of this position is expected to ensure financial stability of NBFIRA as per its Mission statement and also to ensure absolute protection of investors, creditors and the general public from being taken for a ride by bogus companies like BFM. It should be a given that the Minister receives briefings and updates from the NBFIRA board on the goings-on thereat. Has the Minister been dishonestly briefed on BFM and other such bogus companies. Assuming the Minister has been so dishonestly briefed, what action has she taken on her own volition given that the BFM story is widely and regularly covered by the private media?
Why has the Minister not summarily dismissed some or all Board members given that she is empowered by Section 8(4)(c) to remove a Board member who ‘contravenes the provisions of this Act or otherwise conducts himself or herself to the detriment of the objectives of the Board….’. The detriment of Board member(s) to the objectives of the Board is essentially that such NBFIRA board members have on the basis of the goings-on thereat become so delinquent to the point that all seems to be collapsing under their watch. The fact that on the objective facts emerging from the BFM story, government through district Councils has potentially lost over P 300 million which for all intents and purposes should never have occurred in the first place. It should have been prevented given the skills and competences Board members are required to possess by law. And unless the Minister has appointed persons like myself who do not possess the requisite skills and competencies.
It is my considered view that NBFIRA all the way from the Minister, Board of Directors and executive management have literally slept on the job while BFM and such other bogus companies were busy siphoning with impunity public funds from unsuspecting ‘investors’-the very purpose for which it was established to prevent. Reading reports from various media publications, it appears a lot of spinning from NBFIRA is undertaken to cover up its sheer incompetence of performing its mandate in terms of its Mission statement and the Act that established it. In the process, bogus companies like BFM and others look set to enjoy the non-stop free ride of defrauding individuals and public organisations of their funds. Unless I am missing something here, I am prepared to be persuaded otherwise as always. Judge for Yourself!
‘No one is safe until everyone is safe’ from Covid-19 pandemic. Let us remain vigilant.
