Windhoek-The Inspector-General of the Namibian Police, Lieutenant-General Sebastian Ndeitunga, says evidence gathered by the police in Namibia and South Africa in the N$200 million SME Bank saga points to a “high possibility of organised crime”. The police investigation concerns possible fraud, theft and contravention of Namibia’s Prevention of Organised Crime Act.
Members of the Namibian police have travelled to South Africa where they acquired the cooperation of the South African National Prosecuting Authority to investigate the trail of SME Bank money in that country.
SME Bank is owned 65 percent by the Namibian government, in a venture with minority private investors from Zimbabwe.
“There is a high possibility that this is organised crime … where locals and foreigners are involved,” Ndeitunga said yesterday.
“We made a lot of progress. The police members, who are part of the team, visited South Africa and gathered necessary evidence that could be valuable to our investigation.”
The police started investigations after the Bank of Namibia referred the case to the commercial crime investigation division.
“I can consider it as an investigation [that] is progressing well,” Ndeitunga said.
The Anti Corruption Commission (ACC) director Paulus Noa yesterday said the commission would gladly join the task team investigating the case, if asked. The ACC is currently not involved with the case.
South Africa’s National Prosecuting Authority (NPA) spokesperson Luvuyo Mfaku yesterday told New Era that it has been requested by Ndeitunga to conduct an investigation and trace the trail of the SME Bank’s dubious investments made with that country’s financial and business entities.
Mfaku would not dwell on specifics, saying: “We cannot comment on issues relating to mutual legal assistance where we are the requested state.”
New Era can however reveal that it was through intervention of the NPA, which subpoenaed all South African institutions that transacted with SME Bank, that the Bank of Namibia was able to determine that the millions that were purportedly invested with South African financial institutions and banks were withdrawn and pumped into other ventures, such us buying fertilisers.
It was through the NPA subpoena that Namibian authorities got to learn that the N$195 million that SME Bank had channelled to Johannesburg-based Mamepe Capital in South Africa, was in fact not with Mamepe Capital but has been chucked in other accounts managed by the company.
Mamepe Capital chief executive officer Mauwane Kotane made the damning revelations – including the fact that N$175 million was pumped into buying fertilisers with a Lebanon-based entity – in a deposition to the NPA.
Even though Kotane has promised that the investments would mature and pay dividends, no single cent had been paid to SME Bank when the maturity date arrived on June 30, 2017, when Mamepe Capital was obliged to pay back more than N$28 million, which it had supposedly put in money markets, and nearly N$60 million that it had put in unlisted investment vehicles.
A further N$100 million is scheduled to mature on August 31 and September 30.
The SME Bank was this week officially placed in the hands of the Master of the High Court to start its provisional winding up as ordered by Judge Hannelie Prinsloo in the Windhoek High Court.
Provisional liquidators to oversee the process were appointed and the bank is shut with its ATMs not functioning.
The bank needed recapitalisation of N$359 million to remain afloat, however the Namibian government, as the main, 65 percent shareholder, declined to pump in more money. The other shareholders are the Metropolitan Bank of Zimbabwe, which holds 30 percent, and Zimbabwean company World Eagle Properties, which holds five percent shareholding.
“We believe it would be irresponsible to use taxpayers’ money to compensate for money that was irregularly taken out of the country. We are aware of the job losses [but] we have an economy that is under pressure – a failure by the [SME] bank would further weaken the economy,” finance minister Calle Schlettwein had said, adding that the government has over the past four years been injecting millions of dollars into the bank with no good results.
SME Bank has a staff complement of 208 employees. Dozens of them held a peaceful demonstration on Tuesday regarding their fate at the embattled financial institution.