Mmegi Online :: Kgori Capital tap runs dry
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Last Updated
Thursday 20 September 2018, 12:14 pm.
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Kgori Capital tap runs dry

Asset management company, Kgori Capital that is involved in a financial scandal is allegedly facing closure after running out of funds to maintain its business.
By Goitsemodimo Kaelo Fri 01 Jun 2018, 13:39 pm (GMT +2)
Mmegi Online :: Kgori Capital tap runs dry








Its attorney, Busang Manewe has revealed this after the company put in an urgent application to be allowed access to part of its funds kept in its restrained account before Lobatse High Court judge, Justice Godfrey Nthomiwa.

Last month, the Directorate of Public Prosecution (DPP) made an application for restraining and forfeiture Orders in terms of Sections 39 and 11 of the Proceeds and Instruments of Crime Act. This is in relation to credit amount of P9,081,382.15 standing to the credit of the call account held by Kgori Capital with Stanbic Bank Botswana.

The DPP later made an application for a civil penalty order in terms of the Proceeds and Instruments of Crime Act.

In the current matter, Kgori Capital stated through Manewe that they are seeking an order of the court to partially lift the freeze in respect of the restrained account because they have run out of funds to sustain their business.

He disclosed that the company has “gotten desperate and is literally facing winding and closure of business as its current account has a little over P58,000. He argued that the account has far too little money with which to meet requirements of the business.

“The situation has deteriorated. It’s a predicament the company finds itself in,” he said.  Manewe said his clients are seeking to be allowed access to P2.7 million as the sum for reasonable business expenditure and a further P825,000 for legal fees.

“The matter is urgent because it is apparent that the applicants have run out of funds to maintain their business.  They didn’t bring it two months back because they had other resources with which to run the business,” he argued.

Manewe said the company has now been forced to retrench staff and has no money to pay terminal benefits to the axed employees.

He said the application could not take the normal route because they would be heard in November when the company would have already liquidated.

“If we don’t have access to the restraint money, the business would have to close.

If it goes under, it gets liquidated,

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and then what remedy is there? There is no dispute between the parties that the law allows that the applicant could be given access to the account provided that it shows they are reasonable business expenditure,” he added.

Manewe said that the argument by DPP that it has money in other accounts falls flat on its face because those accounts are for the client. He also said that there is distinction between Kgori Capital and Kgori Holdings.

However, attorney Ernest Mosate of the DPP said the applicants want to abuse the court process. Mosate indicated that it was surprising that though the applicants knew of their financial situation in March, they chose to pursue other issues instead.

“They are the ones who raised the constitutional issue. They said it is a profound issue, which I agree; they focused on it and did not bother to raise the financial issue. But now they come here and talk about ‘believed in’ at the time. A matter can’t be determined on the belief of the litigant, especially if it can’t be demonstrated,” Mosate argued.

“As at April 10, they knew they were under pressure to settle debts, but today they say they were fine. They knew that the matter would not be concluded soon. They knew that the constitutional issue is a profound issue, but they turn and tell the court that they didn’t believe it will take time,” he said.

Mosate stated that this case is an interlocutory application, which would not need a 30-day notice. He also said the applicants have another account, which they can draw the money they need from. He said that Kgori Capital and Kgori Holdings are one and the same thing because “the denominator in that is Kgori”.

“The certificate is a simple document of change of names, nothing much. They changed into Kgori Capital, no change of directorship. The restrained property must be available to satisfy the civil penalty order,” he added.

Meanwhile, judgement in the matter had not been delivered at the time of going to press.

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