…their decisions on behalf of M12 billion fund are thus null and void
Mohloai Mpesi
ONLY two of the 11 trustees of the multi-billion Public Officers Defined Contribution Pension Fund (PODCPF) are certified as “fit and proper” to serve as such.
The startling revelation at the ongoing probe by the parliamentary Public Accounts Committee (PAC) into malfeasance at the M12 billion Fund essentially means that it is being run illegally.
All the decisions of the trustees – including their spirited bid to remove the Fund’s independent and long-term Administrator – NBC Holdings – in favour of their own plaint are therefore illegal.
Their decision to terminate the mandate of asset manager, Mergence Lesotho, into the development of a multi-million dollar hotel for the Fund at the Maseru Racecourse – after incurring huge expenses – could be equally problematic, among others.
The revelation that only two trustees are fit and proper to serve the Fund emerged at yesterday’s PAC proceedings in Maseru. The PAC had summoned the PODCPF’s Board of Trustees and all its 11 members obliged.
The trustees are caught in a storm in which they are accused of taking bribes to sway decisions in favour of their preferred service providers. One of their biggest acts of malfeasance has been their spirited bid to oust independent regulator, NBC Holdings, a pan African and long established and experienced pensions funds administrator, in favour of their malleable candidate.
That would enable them to control the entire value chain of the Fund from administration to allocation of assets for their benefit.
Some of the trustees, like Monaheng Mahlatsi, had been fighting vigorously to have dubious companies like the now infamous Akani Fund Administrators, replace NBC. Akani is enmeshed in various acts of corruption in its fund administration work in South Africa. Mr Mahlatsi and his cohorts had since given Akani the tender to manage the National University of Lesotho (NUL)’s Pension Fund, which they also run, in a deal the PAC has declared as “corrupt and illegitimate”.
During yesterday’s proceedings, the PAC asked if all the trustees are certified as fit and proper by regulator, the Central Bank of Lesotho (CBL), as per the requirements of law. Their terse response was that they had submitted their documents to the regulator and were awaiting a response.
That angered, PAC chairperson ‘Machabana Lemphane-Letsie, who adjourned the meeting, to caucus with fellow PAC members, in another room.
Half an hour later, Ms Lemphane-Letsie returned with her PAC colleagues. She then dropped the bombshell that the Committee had contacted the CBL to ascertain the “fit and proper” statuses of all the trustees. It had been told that only two of the 11 trustees had been declared fit and proper to serve as such.
This riled Ms Lempane-Letsie who declared that the Board of Trustees was therefore illegitimate and was disqualified from making decisions for the Fund.
Ministry of Finance and Development Planning Principal Secretary, Nthoateng Lebona, is the chairperson of the board by virtue of her position in the line ministry of the Fund.
The other members present yesterday are Accountant-General ‘Malehlohonolo Mahase, Teaching Service Department trustee Thaabe Kuleile, Public Officers Defined Contribution Pensioners’ Association (PODCPA) trustee, Monaheng Mahlatsi and Local Government Service trustee, Thandi Mabaso.
Security agencies’ trustees, Karele Poqa and Nomalinge Tlakeli were also in attendance as well as independent trustees Martha Baatjies and Tṧaliko Ntoampe.
Also present were Public Service Employees trustee, Mpotṧeng Pama Letsoela and employer trustee, Matheakuena Lekhoaba.
Representing the Fund’s secretariat were Corporate Secretary Sempe Moshoeshoe, Head of Benefits Administration Makoa Macheli, Head of Investments Motheba ‘Matli and Principal Officer, ‘Mamotlohi Mochebelele.
Also present were Lisenyehelo Matsoso from NBC- Lesotho and and Mergence Lesotho’s CEO, Semoli Mokhanoi.
The PAC on the other hand comprised Ms Lemphane-Letsie, main opposition Democratic Congress (DC) lawmakers, Thabiso Lekitla, Lephoi Makara, Mootsi Lehata of Mekaling, Malimong and Makhaleng constituencies respectively.
Other PAC members present were Basotho National Party (BNP) leader Machesetsa Mofomobe, Alliance of Democrats (AD) proportional representation (PR) legislator, Maboiketlo Maliehe as well as the All Basotho Convention (ABC)’s Montoeli Masoetsa.
A great deal of the proceedings was devoted to discussing the mandate that had been given to Mergence to oversee the development of a five star hotel at the Racecourse Ms Lebona explained how the deal had been cancelled – after the Fund decided not to proceed with the project. But the PAC felt the cancellation had been done unprocedurally.
The most poignant revelation remains that the PODCPF – which has for long been mired in allegations of corruption – is essentially vested in an illegitimate Board of Trustees.
That such an important institution can be overseen by individuals who are not cleared as per the law proves the laxity of Lesotho’s governance systems.
Mr Mofomobe asked the trustees to furnish evidence they had been certified as fit and proper by the CBL to serve in their capacities as per legal rules and regulations governing pensions funds.
“Can we be furnished with documents of members of the Board of Trustees who qualify to be here, who passed the fit and proper test?” Mr Mofomobe demanded, throwing the trustees into sixes and sevens.
Ms Lebona retorted: “There is no determination from the regulator yet, but we have submitted all documentations for fit and proper tests. We have not received a response.”
Mr Mofomobe fired back: “Meaning you are not fit and proper. One of the decisions that created a big argument recently was the fact that the Board of Trustees of the NUL Pension Fund made critical decisions (to appoint Akani Financial Services) as Administrator when they (trustees) had not passed the fit and proper assessment. Here we are now with a similar case of a PODCPF Board of Trustees whose members are not fit and proper?”
Ms Baatjies – one of the trustees – said all her documents had been submitted and she was waiting for clearance from the regulator.
All the trustees said the same, forcing the PAC to adjourn and seek to establish the truth for itself. Only to discover that only two trustees had been cleared by the central bank. The rest have not, meaning they cannot act as trustees. All the decisions they have been making for the Pension Fund are by implication thus null and void.
The identities of the two certified as fit and proper were not immediately identified.
Ms Lemphane-Letsie declared that the Board of Trustees was illegitimate and any of its decisions were therefore unlawful.
“You are not fit and proper and that affects the decisions that you make as the Board. It is only two members of the board who have been confirmed as fit and proper by the regulator,” she said.
“I must say it is disappointing that you did not even try to submit documents for certification…,” she said, meaning that the trustees were lying that they had all submitted documents for verification.
