The fourth and final hearing into the disappearance of more than P400 million from the Botswana Public Officers Pension Fund (BPOPF) is due to kick off next month, before creditors decide what civil action to take against the asset management firm at the heart of the matter.
CMB, now under liquidation, was contracted by the BPOPF in 2014 to manage an initial P500 million investment mandate in private, unlisted equity.
The asset manager and the pension fund fell out in late 2017 with allegations of misappropriation, at which point CMB had reportedly been given P477 million to manage.
The asset manager sent BPOPF P50 million back and said the amount was fulfillment and settlement of its (CMB’s) obligations under the contract.
A statutory manager appointed by the Non-Bank Financial Institutions Regulatory Authority (NBFIRA) published a report claiming the asset manager, under the guise of managing funds for the BPOPF, lost hundreds of millions of pula through bad investments, alleged fraud and personal enrichment, via a complex web of directorships and shady entities.
On July 6, CMB’s local director, Rapula Okaile is due to continue facing questions from lawyers representing creditors, who want to determine what investments were made and how.
CMB liquidator, Kopanang Thekiso told BusinessWeek the fourth hearing would utilise virtual meeting technology in line with the protocols brought by the coronavirus (COVID-19) pandemic.
The hearing will take place before the Master of the High Court and will reportedly feature other creditors such as the Manual Workers Union, Grant Thornton, BIFM, Mascom, Botswana
The list of claims also includes First National Bank Botswana credit cards, bills from stationary providers, IT experts and the staff members who went for months without pay in the period towards CMB’s closure.
“Besides Okaile, we expect testimony from others who were there during the time of these events,” Thekiso said on Wednesday.
“This is the last hearing and we will be compiling a report recommending to the creditors civil recovery processes.
“They will decide what they want to do and we will be instructed by them.”
It is understood of the millions outstanding, an investment of P150 million made by CMB in Wilderness Holdings was handed back at some point to the main creditor, the BPOPF. Another P50 million invested in Cell City is said to be being paid back gradually to the liquidator, adding to the potential recoveries for creditors.
“There is no other real recovery going on,” Thekiso said.
Creditors want answers on the whereabouts of the other invested funds and how recoverable they are.
CMB directors however, have consistently denied any wrongdoing and say all amounts were fairly invested in line with the agreements made with the pension fund.