HIGH Court judge Makara Molefi has granted the Directorate on Corruption and Economic Offences (DCEO)’s application for the government-owned Victoria Hotel to be placed under curatorship.
The application was granted on 15 June 2020. This after the anti-graft body approached the High Court on 12 June 2020 on the grounds that the lease holder, Sobita Investments, was not only unprocedurally awarded the lease but had also failed to honour its end of the bargain through its failure to pay M60 000 monthly rentals since 2002.
The DCEO’s director general, Advocate Mahlomola Manyokole, this week told the media that the High Court had granted its application and the hotel would now be run by a curator- M Putsoa and Associates.
Adv Manyokole said the DCEO has been probing the awarding of the Victoria Hotel lease for close to a year after being tipped of irregularities in the awarding of the lease by anonymous sources.
“The government entered into a contract with Sobita Investments whose director is Ntate Thabiso Tlelai. Ntate Tlelai stays in South Africa. The contract was signed in 2002 for Sobita to operate the hotel and all other related activities in this property.
“We established that the contract was awarded under questionable circumstances,” Adv Manyokole said.
“There were procurement irregularities. There was no proper tender when the contract was awarded to Sobita Investments. That was illegal because then procurement laws prescribe an open tendering process.
“It was a 10-year contract. But before it could even end, it was renewed for a further 10 years despite that the initial contract stated that it could only be extended by five years. As per that contract, Sobita Investments was supposed to pay M60 000 per month in rentals to the government but failed to do so. The Ministry of Finance says it never received any payments,” Adv Manyokole said.
He said most government officials were not even aware that the hotel was government property and only became aware after former Tourism, Environment and Culture principal secretary, Motena Tšolo conducted her own investigations into the leasing of the hotel to Sobita in 2018.
Immediately after Ms Tšolo’s investigations, then Tourism Minister Motlohi Maliehe told the Lesotho Times that the government had resolved to probe the operations of Victoria Hotel after Sobita had failed to pay rent and taxes for more than a decade.
Ms Tšolo was later transferred to the Ministry of Finance. While at that ministry in early 2019, she wrote to Sobita, asking it to “show cause” why it could not be evicted from Victoria Hotel.
On 28 February 2019, Ms Tšolo wrote another letter informing Sobita of its eviction and to hand over all government property. However, her orders fell on deaf ears.
“Sobita continued to occupy the premises despite that eviction, arguing that it had done some renovations and could not just pack and go.
“The Ministry of Tourism sued Sobita Investments for operating the hotel outside the legal framework. It did not have a hotel trading licence. When we looked into the Ministry of Trade’s company registry, we established that Sobita had been struck off from the roll and this means it was operating illegally,” Adv Manyokole said.
Sobita had been struck off the registry on 23 December 2014 and it was only reinstated on 30 April 2019.
Armed with this knowledge, Adv Manyokole said the DCEO subsequently applied for the preservation order which was duly granted by Justice Molefi on 15 June 2020.
“The court has placed this building under a curator- M Putsoa and Associates. Ntate Matsobane Putsoa is working closely with the DCEO. In short, this building is no longer being operated by Ntate Thabiso Tlelai or Sobita Investments.
“This was done to stop the illegal use of monies generated by this property after we established that every single cent generated was illegally moved out of this country to Ntate Thabiso Tlelai in South Africa. It was wrong for the money to be transferred to him while he was not paying his rentals.
“Given that the procurement processes were flawed, no money was supposed to be generated out of this property. These are what we call the proceeds of crime and the DCEO Act empowers us to stop any illegal operations,” Adv Manyokole said
On his part, the DCEO’s head of the assets forfeiture unit, Adv Peter Matekane said the hotel was currently not operational after it was shut down on 19 May 2020. Without elaborating, he said certain standards had to be met before it could be re-opened.
“Whatever has been generated at Victoria Hotel are the proceeds of crime or simply put, money laundering,” Adv Matekane said.