Standard Bank takes on wool ‘lies’

Standard Bank takes on wool ‘lies’

MASERU – ANYONE who has dealt with a dicey debtor knows the drill.  If the debtor is not telling half-truths, then they are dispersing some blame.
“I am waiting for some cheques to clear”.
“I transferred the funds but the bank is delaying to process the payment”.
“The banking system is not working.”
“We could not transfer the money because there was no internet.”
And the list goes on.

The trouble for the person owed is that they have no way to verify these stories.
It’s pointless to call the bank because they are shackled by the strict rules of client confidentiality.
So they wait.
Lesotho’s wool and mohair farmers have walked the same agonizing journey with Stone Shi’s Maseru Dawning.
After reluctantly selling their wool and mohair to Shi, some farmers have waited for months for their cheques.
First, they were told that because the shipping of the wool delayed their payments will not come within the promised “few weeks”.

Second, they heard that they had not submitted their account details on time.
You gave us dormant accounts, Maseru Dawning told other farmers.
The farmers provided the accounts again but Shi conjured up another story, this time claiming that Standard Lesotho Bank is struggling to make the payments because they are too many.
Standard Lesotho Bank has found itself drawn into the ragging fiasco.

Although Maseru Dawning has not directly blamed the bank for the delays, its explanations have consistently put the bank at the centre of the storm.
Standard Lesotho Bank, Lesotho’s largest bank by assets and depositors’ book, might have wanted to forcefully defend itself but banking rules limit how much information it can reveal about transactions and clients.
So ears were pricked up when the bank’s chief executive, Mpho Vumbukani, was called to testifying before the parliament’s ad hoc committee established to investigate the chaos in the wool and mohair sector.

As he fielded pointed questions from the MPs, Vumbukani found himself walking a thin line between parrying unfair accusations against the bank and revealing more than what is permissible under the data privacy rules.
It was a delicate testimony but the import of his message was clear: the bank had nothing to do with the delayed payments to farmers.
Vumbukani systematically quashed those allegations.
Although he did not directly shift the blame to Maseru Dawning, he told the committee that the bank’s payment system is efficient and cannot be blamed for the delays.

He told the committee chaired by Kimetso Mathaba that the system has worked smoothly since the farmers were selling their wool through BKB.
What he was saying is that a system that has worked for decades could not suddenly jam because the broker has changed.

In other words, he was saying if the payment system, the sellers and the products haven’t changed then the problem must be with someone else, not the bank.
He told the committee that they pay according to instructions from their clients, as they did with BKB.
“Maybe in this case, Maseru Dawning delayed to prepare the list of farmers to be paid by the bank,” Vumbukani said.
He said under BKB, farmers were paid through their accounts and not over the counter as is happening now.  With regards to export issues, he said the bank’s operations were strictly controlled by the Central Bank of Lesotho under the guidance of the Ministry of Finance to comply with the exchange control regulations
The allegations that there was some chicanery with payments to farmers and that BKB could have engaged in money laundering were false, he said.

The bank, he added, is banking the farmers directly, farmers’ associations, brokers and government ministries without glitches.
Vumbukani also answered questions about Maseru Dawning’s transactions with Chinese buyers. He said since the wool is exported to China it meant that the payments were in United States dollars. “Upon exchanging Dollars into local currency, the farmers are then paid in Maloti in accordance with payment instructions from Maseru Dawning,” he explained.
Nomonde Sixishe, head of compliance at Standard Lesotho Bank, said the bank has strong anti-laundering systems and processes.

Sixishe said the bank’s investigations department ensures that money is not laundered and if they suspect something, they report to the Financial Intelligence Unit (FIU).
Kamoho Mocheba, a Standard Lesotho Bank official, said their relationship with Maseru Dawning started sometime in 2017.Mocheba said some farmers without bank accounts were historically paid with cheques. He said Maseru Dawning is the one that made a decision to pay the farmers over the counter but the bank had explained other options available at their disposal.

Nkheli Liphoto

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