Police probe M15m wool fraud

Police probe M15m wool fraud

MASERU – BKB, the Lesotho National Wool and Mohair Growers Association (LNWMGA) and officials of the Ministry of Agriculture are under police investigation for a possible M15 million fraud. The Ministry of Agriculture’s principal secretary, Malefetsane Nchaka said he roped in the police after suspecting that there could be fraudulent relationships between the BKB, LNWMGA and the ministry’s officials.

BKB is a South African based company that has Basotho’s wool and mohair for international buyers in Port Elizabeth for over four decades auctioned.

LNMWGA is accused of allegedly unlawfully diverting dipping fees to BKB account, according to the ministry.
The allegations are contained in a letter Nchaka wrote to Assistant Commissioner of Police Criminal Investigation Division on September 13.
Nchaka alleged that on November 20, 2003 LNMWGA wrote a letter to the director of Livestock Services requesting him to facilitate a transfer of dipping levy from the government’s account to the association’s account during 2004 dipping season.

Nchaka says the association indicated that the decision was made during the association’s Annual General Meeting held in Tšehlanyane in August 2003.
He says on November 10, 2004, LNMWGA and the officials from the Department of Livestock Services agreed to pave the way for transfer of dipping campaign activities to farmers under instructions from the Minister of Agriculture, the late Daniel Rakoro Phororo.
During 2006, LNMWGA took full control of dipping.

“The dipping levy proceeds were deposited into LNMWGA’s bank account,” Nchaka says.

He says after getting a legal advice that the move to transfer dipping levy to farmers was illegal the department reversed its previous decision and started collecting the dipping levy on its own.
“In August 2010, LNMWGA advised their broker (BKB) in Port Elizabeth to transfer dipping levy from government’s account into their account,” Nchaka says.
He says the move was vehemently opposed by the department which took necessary steps to stop it but failed.

Nchaka further says since then the farmers are managing the fund that by the law has to be controlled by the government.
The PS has handed the police a dossier detailing the chain of events that led to farmers taking control of all monies that accrued from collection of the dipping levy.
They included management of funds, usage for purchase of injectable acaricide, dipping fluid and other animals’ medication in contravention of laws of Lesotho, international standards and good practices that give government full control and regulation of diseases.

Nchaka says he needs more time to investigate other transactions that date back to 36 years ago. Nchaka says.
He told thepost that he had to involve the police because he could not get the answers.
“I tried to peruse through the relevant laws but could not see where the dipping levy could be kept by the BKB,” Nchaka says.
He says the law clearly shows that all the money recovered shall be remitted to the principal secretary for Agriculture who shall, without delay, deposit it into the “dipping account established under the Wool and Mohair Fund Regulations 1974”.

Isak Staats, BKB General Manager for Wool and Mohair, however said it is surprising that in their bi-annual meeting with the government and the LNMWGA this issue was never raised.
“I am not aware of this issue, not at all,” Staats said.

“It is surprising that for the past 15 years, if they say it happened in 2003, they have never talked about it. It is really surprising,” he said.
Staats said BKB was instructed by the government and the LNMWGA in one of their bi-annual meetings to deduct the dipping levy and nobody has ever complained about that decision.
Seelan Pillay, BKB’s official, said sometime during Ralechate ’Mokose’s tenure as Agriculture minister ministerial “the farmers gave us an instruction to deduct dipping levy and pay it straight to them”.

“This followed an alleged misuse of funds by the government officials who were never transparent in procuring veterinary medicine, and in year out animals were dying,” Pillay said.
He said the government wanted to fight this “but ultimately they understood the benefit of efficiency”.

He said ever since the farmers procured their own medicine, they have trained village veterinary assistants across the country.
“You should pick that Lesotho has less than 10 veterinary doctors and veterinary assistants, so such people were actually paid by the association,” he said.

Majara Molupe

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