Debswana wields axe on ‘fronters’
Pauline Dikuelo - Mbongeni Mguni | Monday August 31, 2026 06:00
The move comes after the diamond giant engaged external consultants to probe widespread allegations of fronting in the CEEP, with some early estimates suggesting that as much as 90% of participating firms were engaged in the practice.
Hailed as the country’s single largest and most ambitious transfer of value from mining to citizens, the CEEP programme set and exceeded its goal to empower citizen enterprises by redirecting P20 billion in Debswana procurement with the target of creating 20,000 between 2019 and 2024.
Debswana is one of the biggest procuring entities in the economy, but citizens and their enterprises have traditionally found themselves playing second fiddle to large, well-established multi-national entities and other foreign titans.
Executives told Mmegi that after the probe, eight companies amongst 22 entities investigated had been struck off the supplier database after they were confirmed to be fronting.
The eight companies collectively received P66.7 million from Debswana since 2024, equivalent to approximately P26.8 million per year.
“Despite the sizeable amount, the expenditure represents about 0.27 percent of Debswana’s annual total spend,” officials said in emailed responses to Mmegi enquiries. “Majority of citizen business partners do comply with both Debswana and statutory anti-fronting provisions.”
The eight companies removed from the supplier database have been barred from doing business with Debswana for two years. After the two-year exclusion period, the companies may submit new applications for consideration for inclusion in the supplier database.
The findings by the external investigation confirm fears expressed by Debswana executives previously of collusion and fronting in the CEEP, with suppliers mushrooming due to unfair practices facilitated by some Debswana employees for private contractors.
“We have found that 90% of service providers are fronting for companies outside the country,” Debswana Head of Supply Chain, Phillip Lisindi, told a previous meeting. “During project appraisals when the said owners of companies are supposed to be answering technical questions, they are quiet and it’s always foreigners doing all the talking, showing that they don’t own these companies. “What is even more shocking is that most of these companies don’t have bank accounts in Botswana; salaries and liabilities are paid from outside the country. “This is a clear manifestation of fronting.”
Lisindi further revealed that the fronting and collusion often manifests in foreign transfer of shares, where citizens are awarded contracts and a few days later the company ownership shifts to foreign partners. He further told the meeting that locals who are involved in fronting often have ownership without control, failing to make critical decisions regarding project management, without consulting international parties.
The latest investigation comes as Debswana continues to tighten controls around its supplier base and citizen economic empowerment initiatives. In 2024, the company spent P5.39 billion on citizen-owned companies, representing 50% of its total procurement spend that year.
Debswana has since engaged the Directorate on Corruption and Economic Crime (DCEC) to help stamp out corrupt practices in its procurement and other processes. The two organisations recently signed a Memorandum of Understanding (MoU) to formalise their work.
“The signing of an MoU between the two entities is aimed at strengthening collaboration in the prevention, detection, and investigation of corruption-related incidents,” officials told Mmegi. “The partnership supports Debswana's broader governance, ethics, and compliance framework by facilitating information sharing, capacity building, awareness initiatives, and advisory support on corruption risk management within business processes, including supply chain and procurement activities.”
Asked whether the DCEC had been involved or is involved in any ongoing investigations within Debswana, executives said: “Where matters fall within the mandate of law enforcement agencies, Debswana engages the appropriate authorities, including DCEC in accordance with established protocols and legal requirements.”
Debswana said it uses a risk-based approach to identify and investigate potential fronting, with cases potentially triggered by red flags identified during procurement processes or reports submitted through its Ethics Hotline.
“Debswana reassures the public, shareholders and investors that it continues to monitor its business environment and adopts a risk-based approach when investigating instances of possible fronting, which may be triggered by either potential red flags picked up during a procurement process or submissions through the Debswana Ethics Hotline.”