—As South Africa’s top court rules that it paid bribes to get mandate to administer a multi-billion maloti pension fund in that country
By Investigations Desk
AKANI Fund Administrators, the Johannesburg based company at the centre of serious corruption allegations in Lesotho, has been left bloodied after South Africa’s top court ruled that it bribed trustees of a multi-billion pension fund in that country to secure the mandate to administer it.
In a damning verdict, South Africa’s Supreme Court of Appeal (SCA), upheld a judgment which found that Akani bribed three officials of the M6 billion worth Chemical Industries National Provident Fund (CINPF), which invests on behalf of its 21 600 members, who are predominantly South African blue-collar workers in the chemical, pulp, paper and pharmaceutical industries.
The three CINPF officials, who were paid tens of thousands of rands by Akani to give the company the deal to administer the Fund, according to the court papers, are Bonginhlanhla Dangazele, Reginald Sema and Ayanda Sithole.
At the time of the corruption from around 2019, Dangazele (now late) was the CNIPF’s Principal Officer (PO) while Sema was the chairman (also deceased in July 2024) of its board of trustees, and Sithole was its deputy chairman. They were 3 of the 6-member sub-committee that was appointed by the CINPF to deal with NBC’s termination and Akani’s subsequent appointment a few days later as NBC’s replacement service providers to the CINPF.
The three received bribes from Akani disguised as funeral claims for the death benefits of their relatives. But a full bench of South Africa’s High Court originally ruled that the death benefit claims were a ruse. The payments were in fact corrupt inducements for the three to favour Akani, the court ruled in a judgment now upheld by the SCA.
NBC Holdings
Ironically, the company that Akani conspired to remove as Administrator of the CNIPF is NBC Holdings, the same company being targeted by trustees of pension funds in Lesotho who appear to be at the beck and call of Akani.
NBC – a pan African fund administrator, with operations in several African countries – had managed the CINPF since 1987.
Suddenly, the CINPF unceremoniously terminated its mandate and allocated it to Akani, alongside two other service providers, Novare Actuaries and Consultants (Novare) and Moruba Consultants and Actuaries (Moruba).
In March 2020, a South Gauteng High Court judge, granted an interim order interdicting the CNIPF from implementing the appointments of Akani and the two others. This after NBC, and others, had petitioned the court to interdict its removal pending a full review of its case against that decision.
Bizarrely and despite the evidence placed before it, that initial court had found in favour of the CNIPF. That decision had cleared the way for the appointment of Akani, alongside Novare and Moruba and the ejection of NBC despite the latter’s nearly 35 years of effective and unblemished service as Administrator of the CINPF.
In 2021, the SCA granted NBC and other parties leave to appeal to the full bench of the South Gauteng Division of South Africa’s High Court.
The full bench consisting of three High Court Judges, then ruled in favour of NBC unanimously on 29 June 2022. This 2022 judgement penned by Judge Leicester Adams, with the concurrence of two others, set aside the CINPF’s 2019 decision to terminate the provident fund’s service agreements with NBC Holdings and NBC Fund Administration Services.
The judges found Akani had bribed three key CINPF officials (Dangazele, Sema and Sithole) to influence its appointment alongside the others Novare and Moruba, as the new service providers, in place of NBC.
This because on 20 December 2019, within four minutes of one another, Neighbour Funeral Scheme (NFS), a company related to Akani, paid Dangazele R40,000, Sema R25,000, and Sithole R25,000. At the same time, two former NBC employees, who appeared to have been colluding with Akani against their employer, were paid 50 000 and 40 000 by NFS.
How bribes were paid
The CIPNF and Akani said the payments to Dangazele, Sema and Sithole were proceeds of claims of funeral policies after the deaths of their relatives.
In support of their death benefits claims, they furnished death certificates in respect of the deceased relatives,’ according to the court documents. However, this was all a hoax. The court found it curious that all the three had joined the same funeral scheme, independently of one another, at around the same time in August 2019 and shortly before they played a pivotal role in the appointment of Akani. They had also then claimed the benefits which were paid to them on the same day.
“Despite the remarkable coincidence that all the three lost “family members” within weeks of one another and all received their payments on the same day, they failed to state how they are, in fact, related to the deceased,” according to the full bench’s ruling.
It was therefore clear the funeral policies’ were a con to disguise their underlying purpose. That version (of the legitimacy of the policies) was “so far-fetched that it can, and it should be rejected,” the court ruled.
“What is even more astounding is the fact that there is no explanation of how NFS could have issued the policies, given that it is not a registered financial service provider. No proof was provided that it was entitled to sell funeral policies,” the ruling noted.
The full bench said the original judge should have rejected the “far-fetched and implausible explanations” proffered by CINPF and Akani for the irregular pay-outs received by the CINPF’s senior office bearers.
The court then decided the irrefutable and only reasonable inference to draw from the payments was that their true purpose was to bribe Dangazele, Sema and Sithole to favour Akani, which they did.
Scathing Judgment
In a scathing judgment, the full bench then declared that the termination of NBC’s services to the CINPF had been fraudulently obtained.
“…..The termination of NBC’s services is tainted with fraud and corruption,” the full bench’s scathing ruling against Akani declared. The bribery of Dangazele, Sema and Sithole was thus sufficient to set aside all the decisions to terminate NBC’s mandate.
“Where the chairperson and deputy chairperson of the board are conflicted by them having accepted, or having agreed to accept, payment of a bribe in order to pave the way for Akani’s appointment, both they and the board as a decision-making body are fatally compromised.
“The non-disclosure of their conflict of interest constituted ‘fraudulent non-disclosure of the board,” the court ruled.
Aggrieved by the decision, Akani appealed to the Supreme Court of Appeal (SCA) in Bloemfontein. Akani’s appeal was dismissed with costs last week. The decision essentially confirms that the payment of bribes to win work is Akani’s modus operandi as evidence in its ongoing skulduggery in Lesotho.
“This is a victory for vulnerable fund members at the mercy of the trustees who make decisions on their behalf. The justice system will not tolerate any malfeasance in taking those decisions,” NBC Holdings (NBC) executive head of legal and compliance, Lieb van Zyl told Citywire South Africa, after the SCA issued its judgment.
Citywire is a premier publication on the SA financial industry.
Vindication
Akani is presently under fire in Lesotho over what appears to be its endemic corruption. In a mind-boggling decision, trustees of the National University of Lesotho (NUL) Pension Fund terminated Metropolitan’s 18 year long mandate to administer the fund in favour of Akani.
The firebrand chairperson of the parliamentary Public Accounts Committee (PAC), ‘Machabana Lemphane-Letsie, told the trustees– straight in their faces – that that they had been bribed by Akani to make their “irrational decision”.
Ms Lemphane-Letsie will certainly feel vindicated by last week’s decision of the SCA.
Judge Dumisani Zondi said he and four other judges of the SCA had unanimously agreed to dismiss Akani’s appeal against the judgment of the full bench of the South Gauteng High Court.
“Every board member (trustee) was given a bribe to score very good marks for Akani,” declared Ms Lemphane-Letsie to the trustees of the NUL Pension Fund as they appeared before her committee two weeks ago.
The office bearers accused by PAC of having been bribed by Akani are NUL Pension Fund Principal Officer, Monaheng Mahlatsi, and Board of Trustees chairperson, Pheteli Malunga, whose influence was said to have subsequently filtered down to the rest of the trustees.
The two were instrumental in appointing Akani in March 2024 despite that the company was not registered with the regulator, the Central Bank of Lesotho (CBL), at the time and it did not have all the requisite documents including a tax clearance certificate, a trader’s licence and proof of incorporation, the PAC said. It emerged that Messrs Mahlatsi and Malunga had been hosted by Akani in Johannesburg, under the guise of inspecting its offices, when no such courtesy was extended to other tenderers, who, ironically included NBC Holdings’ Lesotho division, NBC Lesotho.
The NUL Pension Fund trustees had also appointed Akani without a mandate to do so as their tenure had expired. They would only have gone so far to appease Akani because they had been bribed, the PAC insisted.
The management of the NUL led by its Vice-Chancellor, Olusola Isaac Fajana , has since rejected the trustees decision to appoint Akani. The management has said it will refuse to submit contributions to Akani. It wants those already submitted to be returned but Akani has signalled it wants a resolution for the directive.
Context
The decision of South Africa’s Supreme Court also helps put into context Akani’s machinations in Lesotho.
For instance, Mr Mahlatsi, who as Principal Officer helped Akani win the NUL Pension Fund bid, admitted before the PAC that he was behind a phony court case launched against NBC by some “aggrieved pensioners” whose agenda appears to be nothing else but to get NBC kicked out of its two mandates to manage Lesotho’s biggest pension fund, the M12 billion Public Officers Defined Contribution Pension Fund (PODCPF), which it has administered since 2008, as well as the Senior Officers Defined Contribution Pension Fund (SODCPF), which it has managed since 2011.
If Mr Mahlatsi is on Akani’s payroll, as alleged at the PAC, it makes sense that he has been driving the anti-NBC agenda in the PODCPF, of which he is also a trustee. That only serves to besmirch the characters of people entrusted to run these pension funds as trustees.
NBC is now in court in Lesotho to fight the orchestrated machinations to get rid of it from administering the PODCPF and SODCPF.
Meanwhile, regarding its devastating loss in the SCA, Akani, through its marketing manager, Mathawe Matsapola, said in a statement it would wait for the full written reasons of the judgment before deciding its next course of action. The full SCA judgment is yet to be released. We will update the story once we have it.
