Tuesday, January 18, 2022

Security companies cry foul as FNBB terminates contracts

Security company operators have accused First National Bank Botswana (FNBB) of nepotism and involvement in dubious business practices, after the bank cancelled its multimillion Pula security contracts with a number of security firms and awarded the contracts to a single security company.

Recently FNB wrote a letter to a number of security companies that were contracted to the bank, informing them that it is terminating their contracts without giving them reasons. The letter stated that FNBB was empowered by certain clauses of the contract agreements to terminate services at any time by providing the contractors with a one month notice.

“Please be advised that FNBB does not wish to continue with the Agreement between the parties and therefore is desirous of terminating your services at FNBB…and in terms of the aforementioned clause any party shall be entitled to terminate the Agreement at any time by providing the other party with a one month notice,” read part of the letter.

The bank also states that: “FNBB hereby, with this letter the companies on a one moth notice of its intention to terminate the Agreement at the expiry of the period stipulated above with effect from 1st July 2014 to 31 July 2014. At the expiration of the period we shall return any material, papers or any property that we have in our possession in connection with the performance of the Agreement. This is a dual obligation on both parties and FNBB also expects (you) to return any material any material, papers or property currently in (your) possession to FNBB.”

The security firms in question claim that following the termination of their contracts, FNBB took a decision to award a certain local security company the multi million contracts without following due process.

“We signed the contracts with FNBB after a tender was floated in the media. But as we speak a certain company will replace us and there is no tender that was floated in the media. What is happening is that the company was only given a contract to sign and our companies had their contracts terminated before the contracts expired in November,” said one of the owners of the dismissed security companies, who preferred anonymity for fear of being victimised.

The security companies accused FNB of failing to level the field and keeping small and local security companies out of the market by awarding the contract to a single security company.

“We were not only left in the lurch but the bank has also exposed itself to risk. For instance what will happen in the event that the employees of the company awarded the multi-million contract down tools,” wondered another security firm owner.

They said that if the termination of the contracts was a result of some contentious issues, they would have been brought to the attention of the bank’s resolution committee and the Chief Executive Officer.

“We have employed some security guards and they will be affected by the bank’s decision. At least they should have allowed the contracts to run until they expire. There is nothing on the table that shows that they are not happy with our performance. If indeed they were not happy with our services, there would have been representatives from both sides to resolve the issue,” said another security owner.

Insiders at FNBB say they smell a rat and insist that the contract could have been awarded in a dubious manner to the security company in question, some of whose directors are based in South Africa. Some of the companies whose contracts were terminated also allege that the decision to award the tender to the security company in question was made at FNB in South Africa. Others claimed that that the Head of Procurement could have influenced the decision to give the security company in question a contract without knowledge of the board and other senior management.

Responding to Sunday Standard queries, the bank’s Director of Marketing and Communication, Bomolemo Selaledi said: “we advise that FNBB is rationalizing its service providers with the view of introducing efficiencies and cost savings within the business. Alongside, the Bank will spread the risk across its security scope by engaging a number of security companies.”

Selaledi said FNBB has a Procurement Policy which guides the business on procurement related matters and any contractual intensions are validated by the Procurement Committee and the Executive Management.

“At the same time, the Bank endeavors to support the small business sector in Botswana by spreading its services across a wide spectrum of providers,” she said.

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