Criminal investigations against Capital Management Botswana (CMB) bosses Rapula Okaile and Tim Marsland’s alleged attempt to defraud BIFM of millions of Pula could be the tip of an iceberg.
A charge of fraud has been laid against Okaile and Marsland for attempting to access and transfer funds amounting to millions of Pula from a bank account belonging to Botswana Insurance Fund Management (BIFM).
The Court of Appeal stated this week that “to BIFM fraud allegation, there was an incomprehensible response from Okaile, which BIFM in reply, characterised as being false.”
The BIFM fraud case however may be just a minor misdemeanour compared to the duo’s suspected massive fraud against Botswana public Officers Pension Fund (BPOPF).
The Court of Appeal this week ruled that Justice Motumise erred “in failing to consider the disappearance of some P400 million as a possible financial crime, rather than a purely contractual dispute.
CMB Statutory Manager and former High Court Judge, Peter Collins on the other hand summerised his preliminary report with the warning that: “my suspicion is raised concerning criminal activity on a massive scale which eclipses isolated breaches of financial laws.”
A three men Court of appeal bench comprising Judge president Ian Kirby, Justice Walia and Justice Brand ruled last week that, “the apparent disappearance or dissipation or disposal of P 400 million of BPOPF assets entrusted through BOP to the management of CMB bears full investigation, as it may indicate a financial crime has been committed. Certainly the claim that this dispute is purely contractual and is to be solved at some time in the future by arbitration cannot preclude or forestall a criminal investigation. Many a crime has been committed beneath the cloak of corporate personality, or in the name of the exercise of contractual rights. Only a full investigation, with proper disclosure, will reveal whether that is or is not so in the present case.”
In December last year CMB claimed to have sold 100% of BPOPF’s stake in the fund (representing 99% of the total partnership in the fund) for a paltry P50 million to an undisclosed party. These assets, only weeks previously, had been valued by CMB at P447 million Pula. In other words P 400 million, roughly 90% of the money invested by BPOPF has not been accounted for by CMB.
The Court of Appeal further stated that, “it is to be hoped that the statutory manager will carefully examine the BOP with a view to establishing whether he can or should exercise his powers of repudiation under section 47(6) of the Securities Act. It appears that this agreement has been used rightly or wrongly to convert cash resources not into tangible assets, but promissory notes, not always with any enforceable resort by the investor to the underlying assets purchased on the investor’s behalf. That too will need to be interrogated, lest any possible illegalities be repeated by a replacement general Partner. I express no views on these matters, and trust that they will be fully examined.”