…raises possibility of money laundering through gvt accounts
Mohloai Mpesi
THE Public Accounts Committee (PAC) has berated Accountant General Malehlohonolo Mahase’s office
over its “laxity, negligence and gross incompetence” in the discharge of its duties.
The PAC has also raised concerns that the office’s laxity and nonchalance, could lead to government accounts being used to launder illicit funds.
It added?it was because of the incompetence of that office that led to junior officers swindling the state of the much reported M50million.
The PAC berated the Accountant General’s office after?it established that Lucapa?Diamonds had in fact settled its M175 million debt to the?Lesotho government, for its 2017 purchase of Mothae Diamond Mine.
The Accountant General’s office had denied any knowledge of Lucapa Diamonds having settled its debt for buying the mine.
At a previous PAC sitting, Deputy Accountant General ‘Mabakubung Pitso, had fiercely denied receiving payments to the tune of M175 million, for the mine’s acquisition. The Ministry of Natural Resources had explained that the amount had been paid over a period of five years from 2017 to 2021.
It was only a week ago, at the behest of the PAC and almost eight years after the sale, that Ms Pitso’s office eventually discovered, that the Australian company had paid the Ministry of Natural Resources in full.
Lucapa Diamonds owned a 70 percent stake in the mine, which it is in the process of selling to Lephema Executive Transport. The government owns the remaining 30 percent.
The PAC was investigating the allegedly missing M175 million owed to the government by Lucapa Diamonds, for its 2017 acquisition of Mothae Diamond Mine, as per the current Auditor-General report.
While the Ministry of Natural Resources was insistent that the Australian company had paid the government, Ms Pitso was adamant that no such payment reflected in the government’s accounts.
Last Monday the Ministry of Natural Resources had been questioned about queries raised in the Auditor General’s Report for the year ending March 31, 2022.
Auditor General, ‘Mathabo Makenete, noted in her report that M175 million was owed by Lucapa from their 2017 acquisition of Mothae.
The PAC had therefore summoned the Ministry of Natural Resources to clarify the status of the M175 million before Lucapa Diamonds exits the country.
Ministry of Natural Resources Principal Secretary, Relebohile Lebeta, had insisted the money had been paid by Lucapa.? The Accountant General’s office nonetheless denied the existence of any proof of payment.
The agreement stipulated that Lucapa would acquire the mine for USD$9 million (M175) to be paid in instalments.
The first payment was to be USD $400,000, and the second a USD$4.1 million.
The remaining USD$4.5 million was to be paid in eight instalments of USD$562,000 each, Ms Lebeta had said.
Ms Lebeta had also detailed the payment history, asserting that the total of USD$9 million had been paid by August 2021.
However, the office of the Accountant General did not have the record of any such payments. ?
After the PAC demanded details, Hlompho Matsoso, from the Accountant General’s office finally agreed that the full payment had been made. Matsoso blamed the failure to record the payment on the Central Bank of Lesotho (CBL) which?she?accused of using a vague format “that does not clarify the source of the money”.
However, that explanation was enough to ignite PAC chairperson, Ms ‘Machabana Lemphane-Letsie’s, ?anger.
She attributed the failure to properly record the payment to the Accountant General’s office. She said it was shocking that eight years had lapsed without the payment being properly receipted.
It was because of the “incompetence and laxity” of Accountant General Mahase’s?office that junior civil servants and their accomplices had managed to swindle M50million from the government.
That same office was also to blame for the controversial cumulative M6.1billion that the current and previous Auditors-General, reported as unaccounted for, Ms?Lemphane-Letsie said.
She vowed the PAC would not let the matter lying down “without consequences for that office”.
“I have to say that you had us entangled in a lot of issues before we went to the elections in 2022. I speak in relation to the M6.1billion that the Auditor-General said you could not account for,” Ms Lemphane-Letsie said.
“It is so obvious now, why you cannot account for some of the government’s monies. If today, you can do in seven days, reconciliation that you could not do in eight years, I take it that you don’t want to work.
“This is a sign of an incompetent office, which I believe parliament will not overlook. I conclude that you are doing this thing purposely. You are not serious about this country. There must be consequences for your actions.”
She continued: “This is unacceptable behaviour from the office of the Accountant General. We don’t have to hide it. I believe there must be consequences. M50million slipped through people’s fingers in the Accountant General’s office. This is because that office is incompetent.”
Incompetency, Ms Lemphane-Letsie stressed, started from the top “hence it was easy for lower ranking officers to steal money and do as they like”.
“It is because they have realised that their superiors don’t care. This is a high level of incompetency. Sitting here as PAC chairperson, I am not going to overlook this issue and pretend that things are fine,” she said.
“You give this parliament a bad image. We shouldn’t be here to start with, if ever you had worked on that issue. We are here because of the poor performance of the office of Accountant General. It is unacceptable!”.
Still, Ms Matsoso attempted to explain to the PAC that since Lucapa had paid in dollars, they payment would not reflect in their financial statements.
But Ms Lemphane-Letsie was not satisfied. She demanded justification for why it took the Accountant General’s office eight years to finally reconcile the financial statements.
“We are talking about transactions from 2017, meaning from 2017 until just now, you have been unable to provide the record of this money, until the Auditor General interrogated it,” Ms Letsie said.
Ms Matsoso explained that they used different formats with CBL hence they could not reconcile their books.
“The financial statements from the Central Bank came in a format that would not allow us to reconcile our books. We asked them to give us a format that we could use to reconcile,” Ms Matsoso said.
“The statement they gave us came as a PDF, and in that format, it is not clear where the money comes from.”
As matters heated up, PAC member, Mamello Phooko, said it was worrisome that an office of that stature, could go for eight years without recording critical transactions.
She said it was most likely that government accounts were being used to launder illicit funds since the Accountant General did not “care to know where that money came from”.
“I am afraid, Accountant General, that all these years the money has not been recorded. The national books have been improperly recorded,” Ms Phooko said.
“I am afraid there might be people using government bank accounts to launder money if books are not properly kept.
“One other time we talked with the Accountant General about the issue of reconciliation. She explained that it was done monthly, specifying that there was a reconciliation team. Are they really doing their work?”
If books were not reconciled, Ms Phooko said, it meant that government accounts and ministries were possibly being used as a haven to launder money, which would then be clandestinely transferred “to its owners without anyone knowing”.
“In this poverty-stricken country, don’t we care to know where the M175million comes from and why is it being paid? This is scary”.
Ms Matsoso acknowledged that her office made mistakes, stating that they were currently reconciling the books from 2016.
“I realise that there was mismanagement of things in our office, and we apologise for that. We became aware of this query in 2022. We are already working on other queries, and they will never be raised. We are now doing reconciliation,” she said.
“We started reconciling from those backdated statements to fix our reconciliation. So, we have realised that it is a lot of work because we are reconciling from 2016, so that our books are proper.”?