Pascalinah Kabi
CONTROVERSIAL Chinese businessman Yan Xie, who served as former Prime Minister Thomas Thabane’s special envoy and trade advisor on the China-Asia Trade Network, has fled the country to avoid possible prosecution for corruption.
Sources within the Directorate on Corruption and Economic Offences (DCEO) this week told the Lesotho Times that Mr Xie fled to Australia after being tipped off that the DCEO and the Financial Intelligence Unit (FIU) were investigating him over suspected corruption in the financing of the construction of Mr Thabane’s two-storey house at Makhoakhoeng, Maseru. The sources did not give the exact time when Mr Xie, popularly known as John, fled the country.
In a telephone interview with this publication from his new Australia base on Monday, Mr Xie said he was unable to respond to the allegations due to ill-health.
He said he had been in Sydney since last September for medical attention for an undisclosed ailment and he would not be returning to Lesotho anytime soon.
“I am in Sydney for treatment and I am very sick,” Mr Xie said.
“I left the country long time ago and I will not come (back) soon. You see I am very sick. I need (to) sleep and oxygen every day”.
DCEO spokesperson ‘Matlhokomelo Senoko on Tuesday said she would neither deny or confirm any investigations into Mr Xie’s dealings.
“We cannot deny nor confirm anything because that in itself compromises our investigations,” Ms Senoko said.
But the DCEO sources insisted that Mr Xie had fled after being tipped off that the DCEO and the FIU had resumed investigations into his alleged corrupt dealings which had allegedly been stopped by Mr Thabane.
Mr Xie has been linked to a number of murky deals that include financing the political parties including Mr Thabane’s All Basotho Convention (ABC).
He is also said to be the main financier in the construction of Mr Thabane’s double storey house in Makhoakhoeng. The sources said the anti-graft body wants Mr Xie to explain his involvement in the financing of the construction of Mr Thabane’s house.
Mr Thabane started constructing his new house at Makhoakhoeng in 2018, just a year after he was installed as prime minister. He had also appointed Mr Xie as his trade advisor and the latter is said to have been awarded several government construction-related tenders at grossly inflated prices so that some of the funds could be used to finance the construction of Mr Thabane’s mansion.
Mr Thabane was not reachable on his mobile phone for comment yesterday.
“John was awarded tenders to supply curtains and furnisher to the new state house, do landscaping and install new cameras,” a DCEO source said.
“The DCEO received a tip-off that the tender prices were highly inflated and that all the spill-overs were later used to finance the construction of Ntate Thabane’s house,” the source added.
Mr Thabane moved into the Chinese-funded State House in 2018 after it was fully furnished by one of Mr Xie’s companies. Another DCEO source claimed that Mr Xie had been tipped of the DCEO’s plans to raid his office at Jackpot Supermarket, Maseru to investigate the issue.
“Part of the proceeds from the tenders were used to pay a company that was contracted to build Ntate Thabane’s house.
“There were no bank transfers between Mr Xie and Ntate Thabane or between them and the construction company. They operated on a cash basis to avoid detection.
“We planned to raid Mr Xie’s office and confiscate every document as part of our investigations,” the source said.
The source alleged that fully aware that the net was closing in on Mr Xie, Mr Thabane fired former DCEO director general, Advocate Borotho Matsoso, in February 2019. He was replaced by current DCEO boss, Adv Mahlomola Manyokole, in July 2019.
Shortly after his appointment, Adv Manyokole suspended Chief Investigations Officer, Thabiso Thibeli, for allegedly refusing to comply with a directive to hand over files and exhibits of cases that he was investigating. He remains on suspension after Adv Manyokole refused to comply with last month’s directive by the DCEO board to reinstate him. Law and Justice Minister Professor Nqosa Mahao says he is handling the issue.
Last September, Mr Thibeli told the Public Accounts Committee (PAC) that Adv Matsoso was fired for investigating some Chinese nationals who were said to be close to then First Lady, ‘Maesaiah Thabane.
Adv Manyokole however, denied these and other allegations that he sought to block any high-profile cases from being prosecuted. He told the PAC that he had forwarded all the case files to the office of the Director of Public Prosecutions (DPP) for prosecution.
FIU Director Palesa Khabele was not reachable on her mobile phone to shed light on the FIU’s own investigations into Mr Xie’s alleged corruption.
A source said the police also launched their own separate investigations into the matter.
Deputy Commissioner of Police Paseka Mokete this week told this publication that they were investigating the Home Affairs tender scandal where Mr Xie allegedly defrauded four local companies that were awarded a tender to supply the Ministry of Home Affairs with park homes worth M26 million. The four companies — Legends Construction, Selemela Steel Works and Construction, BT Group and L&Kiti — were awarded the contracts in January 2019. After being awarded the contracts, the four companies were allegedly told by Home Affairs principal secretary ‘Machabana Lemphane-Letsie to approach Mr Xie for funding. The latter is said to have withdrawn monies paid into the companies’ bank accounts without their knowledge. Ms Lemphane-Letsie denied any wrong-doing when she appeared before the PAC last year.
DCP Mokete said “the police are investigating the tender scam at Home Affairs”.
“Assistant Commissioner of Police (Beleme) Lebajoa is best placed to give you details on these issues,” DCP Mokete said.
ACP Lebajoa on Tuesday said he did not have updated reports on the Home Affairs tender scam and the M7 million scandal involving Mr Xie and the Lesotho PostBank.
According to information given to PAC members last October by a local commercial bank, all the transfers in the Home Affairs scandal were done on 22 March 2019 and totalled about M26 million.
The commercial bank’s report to the PAC, seen by the Lesotho Times, clearly tabulates the amounts withdrawn from each of the four companies’ accounts into Mr Xie’s Teboho Construction account.
The commercial bank, which asked not to be named in this publication, says in its own analysis and view the four companies were merely used as fronts for Mr Xie’s Teboho Construction.
Mr Xie is also wanted in connection with the irregular transfer of M7 million from a Lesotho PostBank account held by Meriti Holdings (Pty) Ltd into another one belonging to Teboho Construction at a different bank. Teboho Construction was controlled by Mr Xie.
According to the sources, the scam happened two days after the Meriti Holdings account holders had submitted a new shareholding structure of their company and a new set of account signatories to PostBank.
At the time of the illegal transfer, one Teboho Mothebesoane controlled 490 shares of Meriti Holdings while a Xiao Fung owned 510 shares. However, as of 15 January 2019 Mr Mothebesoane became the sole shareholder of the company controlling all 1000 shares.
Soon after Meriti Holdings approached the bank on 23 January 2019 to change their account signatories, the illegal transfer was done to Teboho Construction.
Lesotho PostBank’s chief credit officer Themba Sopeng was suspended and fired in July 2019 over accusations that he had potentially prejudiced the bank of nearly M7 million after he irregularly transferred that amount from the account of one company into another without any basis for the transaction.
Mr Sopeng was accused of making the transfer unilaterally without following the bank’s procedures and involving others who should have authenticated the transaction.
