How CMB hypnotised Peloetletse with money

It turns out that at one stage DISS thought the relatively smaller matter of Emma Peloetletse and CMB could be a crucial cog in the wheel of investigations into how former president Ian Khama allegedly took the king’s ransom amount of P100 billion from the Bank of Botswana and distributed it into offshore accounts around the world, INK Centre reports

How CMB hypnotised Peloetletse with money

Acting Permanent Secretary to the President (PSP) Emma Peloetletse allegedly promised Capital Management Botswana (CMB) her full support in a bid to increase their exposure to the BPOPF, the country’s largest pension fund, allegedly in exchange for kickbacks.

In August 2014, CMB won a tender to manage P500 million on behalf of the Botswana Public Officers Pensions Fund (BPOPF). In July 2017, the firm unsuccessfully sought to increase its portfolio to P1.1 billion but needed backing from the Board of Trustees. CMB is now being sued for mismanaging the funds.

Peloetletse sat on the BPOPF Board as the government trustee representative. She also chairs the powerful Finance and Investment Committee, which appoints fund managers that manage the P65 billion pension fund assets.

According to well-placed sources,  in April 2017, Peloetletse and her husband allegedly received air tickets and luxury accommodation to the prestigious Cape Town Jazz Festival worth more than R98 000 (approximately P73 000) from CMB without the knowledge of other trustees and BPOPF management. The trip was allegedly not approved by the BPOPF. Other beneficiaries of the luxury trip allegedly included the former CEO of Fleming Asset Management Botswana, Moitseki “Chucks” Lekalake and his girlfriend, two people from the Botswana Public Employees Union (BOPEU) and two other undisclosed individuals.

Lekalake allegedly had a beneficial relationship with CMB through Varsity League, a little-known firm which was paid P3 million from CMB for unknown reasons. In line with anti-corruption international best practice, BPOPF policies prohibit trustees from accepting gifts and invitations to “hospitality events” from stakeholders and clients in order to protect the transparency and integrity of the Fund. In 2019, Peloetletse was expelled from the BPOPF Board of Trustees after it emerged that she was under investigation in connection with the trip. In court papers filed by BPOPF, they accuse CMB of mismanagement of funds.

Three months after the Cape Town trip, CMB requested the BPOPF Board to consider an increase in their exposure to P1.1 billion. The asset management firm was allegedly banking on Peloetletse to influence the decision in the investment committee. However, BPOPF declined their application based on an argument that their pipeline for expansion of the investment was unconvincing. The committee was also concerned that CMB had invested more than 80 percent of the P500 million already allocated to them without providing evidence of growth and yield.

At that stage, sources say Peloetletse had become a vocal supporter of CMB’s quest to double its portfolio. “She asked management under what circumstances they could get them more money,” said the source. “It appears they had discussed this (in Cape Town and she had promised them more money). There was no good reason.” It was only after an Advisory Committee Board made a resolution that CMB got the money, though in the smaller amount of P380 million.

BPOPF governance rules require all trustees to sign an annual declaration of interest, according to the Fund’s CEO, Moemedi Malindah. He declined to say whether Peloetletse had declared her CMB-sponsored trip to Cape Town to the Board, saying the matter was under investigation. Said a former trustee who did not want to be identified: “Some asset managers will not waste an opportunity to incentivise trustees,” 

How will the investigation end?

In a letter dated 17 June 2019 to the BPOPF Board Chair Solomon Mantswe that INK Centre has seen, Peloetletse tried to pre-empt the investigation, saying accepting an invitation from stakeholders was common. This claim was disputed by her fellow trustees and the Fund’s Gift and Entertainment Policy, which expressly prohibits such behaviour. Peloetletse has refused to answer further questions on the investigation.

INK Centre understands from another well-placed source that the Peloetletse’s case has been delayed by DCEC because agents of the Directorate of Intelligence and Security Service (DISS) argue that if she is not prosecuted, her cooperation could add weight to a broader probe into whether former president Khama diverted P100 billion to offshore accounts for personal gain. The Office of the Accountant General, under the Ministry of Finance, deals with recurrent expenditure, government revenue and the development budget. “(The) Peloetletse case was stopped by (Brigadier Peter) Magosi because he felt that she would endanger the P100 billion case,” the source said.

According to the source, DCEC should have investigated the matter and forwarded a docket to the public prosecutor. But, according to this source, that is now unlikely. President Mokgweetsi Masisi promoted Peloetletse while she was under investigation, from her relatively obscure position of Accountant General to become Deputy Permanent Secretary in the Office of the President.

The Director General of DCEC reports to the Permanent Secretary to the President (PSP). Peloetletse is said to have a close relationship with President Mokgweetsi Masisi and former cabinet minister Thapelo Olopeng. During his campaign for party chairmanship, Masisi was allegedly a guest of the Peloetletse family in Tonota. Other people facing corruption charges related to the BPOPF and CMB matter have been discharged.

Reached for comment, DCEC said it is constrained to respond as the “CMB case is under investigation”.


Additional reporting by Julia Kotlhao. INK Centre for Investigative Journalism compiled this investigative story. Go to INK website for more stories.