Ex-SSC Manager Recounts Avid Lobbying

FIVE of the seven people accused of embezzling a Social Security Commission investment of N$30 million in early 2005 had meetings with SSC managers to promote the inexperienced asset management company that ended up being entrusted with the parastatal’s money.

Despite initial misgivings about the unproven Avid Investment Corporation, high-level SSC managers were eventually persuaded to invest N$30 million with Avid after several people had lobbied with the SSC on behalf of the company, a former manager with the parastatal, Gideon Mulder, testified in the Windhoek High Court this week.

Swapo member of parliament Paulus Kapia, former MP Ralph Blaauw, lawyer Otniel Podewiltz, one of the directors of Avid, Inez Gacircses, and retired Namibian Defence Force Brigadier Mathias Shiweda had meetings with SSC managers, including himself, during January 2005 to persuade the SSC to invest money with Avid and to allay doubts about the trustworthiness of the company, Mulder told Judge Christie Liebenberg.

Mulder testified that after the then chief executive officer of the SSC, Tuli Hiveluah, approved a recommendation to invest N$30 million with Avid on 21 January 2005, Mulder and the SSC’s general manager of finance at that stage, Avril Green, had second thoughts about the deal and decided to cancel it.

However, by then Blaauw had already picked up a letter confirming the approval of the investment from the SSC’s offices, Mulder said.

Following further meetings with Kapia and Gacircses, who were representing Avid, it was decided to go ahead with the investment after all, Mulder said. That decision was taken after Kapia had warned him about the possibility of a penalty of US$1 million if the investment was not carried through as initially approved, he said.

Mulder is the first witness to testify for the prosecution in the trial of Kapia, Blaauw, Gacircses, Podewiltz, Shiweda, Nico Josea, and Blaauw’s wife, lawyer Sharon Blaauw. The trial started before Judge Liebenberg on Tuesday, when the seven accused pleaded not guilty to all of the charges faced by them as a result of the alleged embezzlement of the money that the SSC invested with Avid.

In written plea explanations provided to the judge the seven accused specifically denied having defrauded the SSC or stolen the N$30 million that the SSC invested with Avid.

The seven accused are all charged with a count of fraud, alternatively theft, and charges of reckless or fraudulent conduct of business and giving false evidence at a High Court enquiry into the financial collapse of Avid.

The four former directors of Avid – Kapia, Gacircses, Podewiltz and Mrs Blaauw – are further charged with six counts under the 1973 Companies Act, in which it is alleged that they had failed in their statutory duties as directors of the company.

In his plea explanation Kapia decried the prosecution’s decision to charge him. He claimed that from the contents of the police docket on the investigation of the case “it is clear that there was no legal basis to charge me”.

Kapia also claimed: “It is evident that the State cannot escape a conclusion that charging me was simply an act of inappropriate submission by the State to the uninformed public pressure and expectation. The State knows exactly who stole the money alleged, and that I did not criminally associate myself with such people or entities.” (sic)

In his plea explanation Josea said he did not know that an amount of N$29,5 million that the founder of Avid, the late Lazarus Kandara, deposited in a bank account of a company of Josea, Namangol Investments, on 28 January 2005 had originated from the SSC.

Josea added that Kandara gave him oral instructions to transfer N$20 million to one Alan Rosenberg to be invested by the latter, to find an investment with high returns for an amount of N$6,3 million, and to keep the remaining N$3,2 million in his company’s account pending further instructions from Kandara. The money kept in the account was later “dispersed as directed by him (the late Mr Kandara)”, Josea stated.

Gacircses said in her plea explanation that Kandara, who was her cousin, asked her to become a director of Avid in April 2004.

She said she was surprised when she discovered later that she had been made the chairperson of the company’s board of directors – without having attended any board meeting where such a decision had been taken.

Gacircses said after the SSC had transferred the N$30 million to an account of Avid she, “to my best knowledge”, signed a letter authorising the transfer of the full amount from Avid’s account. When she discovered later that only N$29,5 million had been transferred, she realised that N$0,5 million of the SSC’s money had been used to cover a shortfall in Avid’s account, she recounted.

Podewiltz informed the court that he was a director of Avid only from mid-April 2004 until 24 November 2004. That was well before the SSC investment was done, he pointed out.

Mulder is due to continue with his testimony on Monday.

Source : The Namibian