Saturday, January 16, 2021

Pensioners lose P200 million in BPOPF bid to spite Nchindo

Botswana government pensioners have lost more than P200 million in the victimization of African Alliance (AA) by the Botswana Public Officers Pensions Fund (BPOPF) in an apparent bid to spite Louis Nchindo ÔÇô a confidential report on the investigations into the operations of BPOPF has suggested.
Nchindo is chairman and biggest citizen shareholder in African Alliance Botswana.

Jacques Malan Consultants & Actuaries, who were last year commissioned by the Registrar of Pension and Provident Funds of Botswana, suggests that the decision to terminate AA’s P4 billion contract may have been “vindictive” and “personal.”

The report, a copy of which has been passed to The Sunday Standard, says the decision to fire AA shows up BPOPF Trustees in a poor light for the following reasons:

* Why remove one of the best asset managers? There is a potential loss of future investment performance by the Fund.

.* “Was AA’s appointment terminated for any personal or vindictive reasons? It would appear that Mr. Gaobakwe played a leading role in these discussions.”
It emerged in the report that BPOPF refused to disclose crucial information on the termination of AA to Jacques Malan Consultants & Actuaries. “By seemingly concealing this information,” states the report, “it leaves an impression that something is not right and is being hidden.”

BPOPF had initially managed to block investigations into their operations by Novare Actuaries and Consultants, commissioned by the Permanent Secretary to the President, Eric Molale. BPOPF resisted the investigation arguing that in terms of the Pensions and Provident Fund Act, the only officer who could commission an investigation into the affairs and operations of any retirement fund, including BPOPF, was the Registrar.

Mr. Molale, who is head of the Civil Service, had acted in that capacity.
African Alliance has been asset managers for the BPOPF since its inception in 2001, but was told in April 2007 that their services were to be terminated on 31 July.

“It has not been possible to obtain a copy of the asset consultants report, but Jacques Malan Consultants & Actuaries are led to believe that, in the tendering process, African Alliance was ranked third, yet they were fired and six other asset managers appointed.

As the report has not been produced, but looking at the Investment Committee’s minutes, it appears that the decision to dismiss AA had been taken months before the tendering process began. It would seem that AA did not always manage the relationship well, but clearly they were frustrated with the inability to talk to the Trustees directly and with the trustees’ apparent inability to understand what they were trying to achieve (which we think was reasonable). AA has now instituted court proceedings against the Fund and, should they win, the consequences for both the Fund and the Trustees will be severe,” states the report.

The investigations further turned up information that government pensioners have lost more than P200 million as a result of AA’s victimization. Jacques Malan Consultants and Actuaries were requested to quantify the investment losses as a result of the actions taken by the Trustees. They cited the amount between P100 million and P180 million that was lost when the Trustees blocked a lucrative deal between AA and Mascom.
“The other matters are lost investment opportunities (such as when AA was prevented from trading) and these cannot be determined with any degree of certainty.

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