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Fresh twist in P400m row: Statutory manager locked out

Former High Court judge and prominent attorney, Peter Collins has found himself locked out of the Capital Management Botswana (CMB) offices, where he is supposed to be conducting a probe into, amongst others, alleged suspicious transactions.

The Non-Bank Financial Institutions Regulatory Authority (NBFIRA) recently appointed Collins as the statutory manager for CMB, a local asset manager which holds the mandate for disputed funds estimated at P400 million on behalf of the Botswana Public Officers Pension Fund (BPOPF).

The souring of relations between BPOPF and CMB last year, amidst complaints by the pension fund, triggered legal suits between the two that saw NBFIRA’s engagement in the matter through the placement of CMB under statutory management in January.

A flurry of legal challenges followed earlier this month, with Judge Omphemetse Motumise initially ruling in favour of CMB, who were resisting the statutory management.

A day later, Motumise varied his order to allow Collins’ appointment, after a successful challenge by NBFIRA.

Lawyers representing NBFIRA and CMB have since differed on the effect of Motumise’s judgement, although neither has sought relief before the High Court, as the return date for the main matter, March 9, is already close by.

The already acrimonious case plumbed new depths when Collins reported for duty on February 5 only to find that CMB directors had moved funds out of their account, empowered by Motumise’s initial ruling.

An amount of P10 million was moved out of CMB’s First National Bank Botswana account to a separate account not covered by Motumise’s order.

This week, lawyers representing NBFIRA told BusinessWeek that the former judge had not been granted access to CMB’s office since the varied High Court order granted on February 2.

“The statutory manager cannot access the premises,” Armstrongs’ lead partner (commercial), Sipho Ziga told BusinessWeek.

“The statutory manager is trying the best he can with other sources. He is yet to give us a formal report.

“They have said they will not give him access.

“We could go to the judge

on an urgency and they would then respond and when everything is done, the March 9 date would have passed.

We considered that, but it would not work.

“You can have the law on your side but that may not matter.” Yesterday, the office of the former High Court judge confirmed the state of play.

““Mr. Collins has not since the last court hearing attempted to enter the premises of the CMB (Pty) Ltd. 

Nevertheless, he continues to discharge his function as best possible pending confirmation in terms of the court proceedings pending,” Collins Chilisa attorney, Shathani Somolekae said in a written response.

While efforts to contact CMB’s attorneys were unsuccessful yesterday, representatives of the asset management firm have previously said they do not recognise Collins’ role as statutory manager.

CMB attorney, Gabriel Kanjabanga previously told BusinessWeek that Collins’ appointment was amongst key challenges the asset manager was making in the matter.

“There are no duties for the statutory manager to perform.

His appointment has been challenged in court on a number of grounds. The statutory manager has to wait for the outcome of the court proceedings.

“He wants to defeat the purpose of the application, but he cannot continue as if nothing has happened.

“We are saying when the (order for) statutory management was done, our client was not consulted and we are saying, even the statutory manager is conflicted.

“There are court proceedings going on, so how can he claim that he is the statutory manager, when his appointment is the subject of court proceedings,” Kanjabanga said.

By law, NBFIRA is entitled to appoint a statutory manager if it appears any institution “is involved in a financial crime, is of unsound financial position or is not complying with a financial services law”.





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