DCEO uncovers more rot in dealings with govt properties
- as company is awarded a multi-million “verbal contract” to manage rail facility
THE Directorate of Corruption and Economic Offences (DCEO) is investigating violations of state procurement regulations and possible corruption which allowed a local company to pocket millions of maloti for managing the government’s Mascon railway facility in Maseru.
DCEO director general Advocate Mahlomola Manyokole yesterday told the Sunday Express that the government had not been paid a single cent ever since Katleho Logistics was awarded a contract to manage the railway facility by the Ministry of Public Works and Transport in 2018.
But what makes this deal even more reprehensible is the fact that the multi-million dollar contract was awarded by word of mouth only without any lawful tender processes.
Adv Manyokole said they had since ordered Katleho Logistics to cease operations pending investigations into how they were awarded the dubious contract.
This is the second such unprocedural contract the DCEO has uncovered in as many months. Last month, the DCEO discovered that the government-owned Victoria Hotel had been allegedly unprocedurally and corruptly leased out in 2002 by then Finance Minister Timothy Thahane to South African businessman Thabiso Tlelai.
It was then used as a conduit for money laundering by Mr Tlelai, the DCEO alleges. The DCEO estimates that the government has been prejudiced of M19, 4 million due to non-payment of rent for Victoria Hotel.
In the case of the Mascon railway facility, Adv Manyokole said Katleho Logistics was allegedly awarded a verbal contract by the public works ministry in 2018.
This was during the tenure of the previous Thomas Thabane-led four party administration which came to a premature end on 20 May 2020 and paved way for a new government led by Dr Moeketsi Majoro.
Lesotho has a very small railway line which allows goods to be brought into Maseru’s industrial area from neighbouring South Africa.
The railway line was previously operated by a South African company, Infradev, on behalf of the Lesotho government.
Adv Manyokole said although he did not have the figures at hand, Infradev used to pay dividends to the government.
He said Katleho Logistics had not paid anything to the government after taking over the running of the railway facility in 2018. Katleho Logistics’ duties included loading and off-loading containers as well as storing the containers.
Adv Manyokole said their investigations had uncovered that Katleho Logistics had taken advantage of the absence of a written document indicating the terms of the contract to pocket all the proceeds from the railway line estimated at M8 million to date.
“About a month ago we got a tip-off that Katleho Logistics had been operating the Mascon railway service without a valid contract and had therefore not paid a cent to the government,” Adv Manyokole said yesterday.
“They (Katleho) have been operating the facility and they also occupied government premises without paying anything. There is no written contract and all we have to go by is Katleho’s version that they could not pay anything because they did not know the amount expected of them by the government.
“The company alleges that it tendered for and was verbally awarded a three-year contract by the Ministry of Transport which was then part of the Ministry of Public Works and Transport. However, we have not been given any proof that there was indeed an open tender before they were awarded the tender. It is not clear who exactly awarded them the tender.
“They have been collecting monies from courier clients for their own benefit. We have picked up that so far, they have pocketed M8 million. We have therefore suspended their operations and frozen their bank accounts.
“This is to allow us to recover the suspected proceeds of crime. We believe that the tender process was flawed.
“After the investigations, it will be up to the government to decide whether or not to lease out the facility or operate it themselves.”
Adv Manyokole said the Mascon railway facility probe was part of their project to uncover all government assets which had either been sold or leased without following proper procedures.
He also urged those who have benefitted from the unprocedural disposal or leasing of government assets to voluntarily come forward to avoid harsh sentences if they are caught after protracted probes.
“In April this year, we launched a two-year programme to uncover government properties that have been unlawfully leased out through flawed tender processes or sold to private companies or individuals.
“The Mascon railway facility is the second flawed tender we have discovered after the Victoria Hotel lease,” Adv Manyokole said.
According to the DCEO, Mr Tlelai’s Sobita Investments was awarded the lucrative deal to lease the strategically located Victoria Hotel without an open tender process as required by procurement regulations.
Since “corruptly” obtaining control of the hotel, Mr Tlelai has used it to export millions of Maloti to his other South African based accounts but has never paid a single cent of the monthly M60 000 rent for the facility. Nor has he paid any taxes to the Lesotho government, thereby prejudicing this impoverished country of revenue it should have obtained from a key asset.
Adv Manyokole and his principal investigations officer, Tsotang Likotsi, accuse former Finance Minister Dr Thahane of orchestrating the entire “corrupt” scheme and want him charged with corruption.
As if this is not shocking enough, the DCEO’s head of the assets forfeiture unit, Adv Peter Matekane, further revealed that government officials in the Finance and Tourism ministries as well the tender board were not even aware that the hotel is government property.