Mmegi Online :: Kgori Capital judgement reserved for November
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Monday 19 November 2018, 13:52 pm.
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Kgori Capital judgement reserved for November

Kgori Capital lawyer, Busang Manewe says his client did not commit and benefit from serious crime activity and only received what was due to it as outlined in the interim mandate for the management of the fund portfolio.
By Goitsemodimo Kaelo Mon 13 Aug 2018, 11:15 am (GMT +2)
Mmegi Online :: Kgori Capital judgement reserved for November








Manewe said this on Friday before Justice Godfrey Ntlhomiwa when he argued on behalf of Kgori Capital against a civil penalty order application made by the Directorate of Public Prosecutions (DPP) in relation to the frozen P9, 081, 382.15 held in the asset management company’s accounts as management fees.

DPP has applied that the court pronounce that Kgori Capital, which was subcontracted by Basis Point Capital to be the investment and asset managers of the National Petroleum Fund (NPF) benefited from serious crime activity, and thereupon to order a civil penalty order against them for the respondents to pay to the government the money which the court ultimately determines, after assessment, were benefits from serous crime related activities. The DPP argues that the fees were contrary to the P15,6 million Consultancy Agreement entered into by the government and Basis Point Capital.

Manewe told the court that the government case is sketchy and is based on unsupported or unsupportable assertions and averments.

He said that his client did not commit any crime as the contract of the Consultancy Agreement clearly explains that the P15,6 million excluded management fees, which were to be calculated at 0,8 percent annually or 0,0067 per month.

He said that DPP has failed to prove that which his or directors of Kgori Capital and Basis Point to the exclusion of Kenneth Kerekang who authorised the interim mandate because they did not withhold or present any incorrect version to induce Kerekang to sign the mandate.

“A cardinal concession has been made by the investigator that both Kerekang and the directors of the Basis Point were fully aware of the existing Consultancy Agreement and its terms when they executed the interim mandate. So there was not falsity. None was shown to exist,” he argued.

He said that even if there were to concede that there is force in the argument that the interim agreement was

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invalid for want of authority by Kerekang, Kgori Capital would still have been entitled, on the basis of quantum meruit to be remunerated for its services in managing the NPF funds.

He said that consultancy in so far as they relate to providing financial management and investments may be of technical nature, further adding that it would be absurd to say that remuneration for services of managing financial and investment portfolio can be fixed in a contract.

“Having said that, it is the respondent’s submission that the Applicant has failed to make a case for civil penalty order and therefore prays that it be dismissed,” he added.

Attorney Ernest Mosate of the DPP had earlier submitted that the respondent had benefited from proceeds of crime related activity, as it was merely a subcontractor in the respect of the Consultancy Agreement with the government.

He said that the respondent had no lawful basis for debiting the NPF ostensibly as management fees. 

“The only substantive party to the Consultancy Agreement entitled to fees under the agreement was Basis Point Capital who in turn was under a contractual duty to pay its subcontracting parties. There is not evidential legal basis for the so called interim mandate on which the respondent seeks to rely,” submitted Mosate. 

He further submitted that Bakang Seretse, who was the director of both Basis Point and Kgori Capital was aware that it was a subcontractor under the Consultancy Agreement.

He argued that the respondent was fully aware that the scope of works under the Consultancy agreement covered the management of the fund portfolio.

He stated that the respondent further by reason of dealing with monies that it created to its own account from the NPF, in the various transactions of pay out engaged in transactions that involves property that is a proceed of money laundering.

Judgement on the case has been set for November 28, 2018.

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