Phiri No Money Launderer - High Court
Staff Writer | Friday September 8, 2017 12:46
Handing down judgment on Thursday in the long running case against Phiri by the DCEC, who froze his various accounts at Stanbic with P25 million worth of foreign currency last year suspecting money laundering, High Court judge justice Michael Leburu said there was nothing suspicious at all about the frozen accounts, saying evidence from Forex World Pty Ltd, in South Africa, which disbursed the foreign currencies to Phiri, absolved Phiri from any suspected criminal activity. All the accounts were unfrozen by order of the court on Thursday last week, giving Phiri and Khato Civils Botswana access to the remainder of the P15 million in the various bank accounts at Stanbic.
Forex World CEO, Shmulik Weltsman, had furnished the court with evidence that Khato Civils were in the list of its clients with allocations of R20 million per year in foreign currency for purposes of business trips. In that list of the facility known as the Omnibus facility, two of Phiri’ companies, South Zambezi Engineering, and Khato Civils, both headquartered in Johannesburg, had been allotted a total R40 million a year in omnibus facility.
The judge also said another independent party, the FNB of South Africa had also shown that Phiri’s companies, Khato Civils and South Zambezi were liquid with more than R 3 billion of turn over between them, while Simbi himself was liquid with over R 5million in his personal account.
Phiri also told the Court in his papers that besides civil engineering, he is also involved in several businesses, amongst them international currency speculation, a business that involves buying, selling and holding currencies in order to make a profit from favourable fluctuations in exchange rates.
He had told the court that due to the nature of this work, it is not uncommon that he carries with him large amounts of cash in his safe.
The investigations that started last year also saw a bank account belonging to former Minister Ndelu Seretse’s company Mognibot, also frozen, after it had been paid about P1.5 million for services rendered to Khato Civils. Mognibot’s bank account would later be unfrozen, as Seretse got is money
DCEC investigators brought Simbi Phiri to the attention of the local media last year when they froze the bank accounts associated with Phiri and his company at Stanbic Bank, after Phiri had under declared the amounts of foreign currency in his possession on two occasions while entering Botswana.
The under declaration in question related to the USD 800 000 declared, instead of USD 886 000 and the USD 300 000 instead of USD 500 000, however Phiri said the under declaration was by genuine mistake, and that on many occasions except the two mentioned occasions, he had not failed to declare all his cash at the point of entry, adding further that his source of the funds was above board, and completely legal.
Meanwhile the judge did not hide his frustrations with the DCEC investigator, Mompoloki Snax Rapulane, who after 12 months on the supposed investigations, only returned with a copy of the South African Reserve Bank’s Manual on the use of money for travel purposes.
However, Judge Leburu said the DCEC should leave that matter to the Forex World pty Ltd and the Reserve Bank of South Africa, and wondered why the DCEC would act on behalf of the South African entities when they had not authorised them to do so.
The judge also wondered why the investigator had failed to go to South Africa to interview the suspect, Phiri, as South Africa is a fellow member of SADC and both Botswana and South Africa enjoy diplomatic relations, thus facilitating easy access into each other’s territory.
Judge Leburu was also concerned that it had been over a year since Investigations commenced but up to now the court had not been informed as to when such investigations will be concluded, adding that in this case, there has been unreasonable delay, “How do you freeze a person’s bank account for over a year and then not interview them on the funds so restrained?”
Judge Leburu also took his time to lecture to the DCEC investigator, Snax Rapulane, few basics of investigations of money laundering cases, which seemed to be lacking in great deal.
Judge Leburu’s free lecture on methods of investigations included financial interviews, financial search warrants, surveillance, trash pick-ups, asset investigations, undercover operations, analysis of bank and other financial records, wire taps, analysis of suspicious activity reports and currency reports, to name a few, all of which were lacking.
Interestingly it was the victim, Simbi Phiri who brought it to the attention of the court that he was surprised that up to now the investigators have not interviewed him despite the fact that his telephone numbers, mobile phone numbers, home address in Johannesburg, and work address, including plot numbers, were availed to the DCEC by Stanbic Bank.
Phiri also wondered why the DCEC would tell the Court that they do not know him or where he stays, he was a flight risk, when in 2014, with the help of South African commercial crime investigators, the DCEC officials came to his home in Johannesburg to interview him about the same Stanbic bank accounts, and a clean report was issued to them.
The judge also observed that Phiri had also suffered invasive prejudice from negative media publicity with such media publications accusing them of money laundering without proof and that could not be allowed to go on indefinitely.