MATHIAS HAUFIKU and TILENI MONGUDHIJUSTICE minister Sacky Shanghala wants an investigation into the state-run N$1,8 billion children and widows inheritance fund.
understands that the proposed investigation was triggered by the discovery that the national savings – known as The Guardian Fund – could lose about N$35 million invested in a property development firm that filed for bankruptcy last year.
The decision to institute an audit is not finalised but it comes at a time when there is a debate on proposed legal changes to the law regulating the fund.
Shanghala wants to change the law to allow the justice minister powers to control the investment of inheritance money, which until now was under private administration.
Although Shanghala’s plans appear aimed at reforming the fund, people familiar with the changes are sceptical.
They accused him of having ulterior motives which could hand over the N$1,8 billion fund into private investment firms – some of them owned by his friends.
Justice ministry executive director Isascar Ndjoze confirmed to last week that Shanghala is in favour of investigating the fund which has up to 40 000 beneficiaries.
If approved, the probe will also look at skills, systems and security to ensure that the 2018 changes to the Administration of Estates Act are enforced.
The publication of unclaimed money every year has allegedly not been done as required by law. The fund has also been failing to produce audited financial statements as good governance would require.
There are also concerns that there is lack of oversight over the decisions by the master of the High Court, Elsie Beukes, the Guardian Fund’s manager.
The fund – through Namibia Equity Brokers (NEB) – invested N$35 million into Faanbergh Properties, a property management company, since 2016.
This includes N$26 million invested by the fund after February 2017 into the same company despite evidence that the company was in the red.
The investment was supposed to yield a further amount of N$6,9 million in interest.
Documents from the Business and Intellectual Property Authority (Bipa) show that Faanbergh Properties was owned by Klaarstaan Business Trust, represented by Adriaan Johan Heerden.
Stephanus Bergh and Pieter Jacobus Krugel are listed as directors. Questions are now being raised as to why the fund continued to pump money into the failing company.
The property firm filed for bankruptcy last year after failing to repay the promised investment returns at the agreed time.
It cited Namibia’s poor economic performance and the collapse of the property market as the cause of the company’s collapse.
The company claims in court papers that it had roped in lawyer Joos Agenbach to craft a rescue plan, but the plan failed.
According to court papers, a meeting was held on 23 February 2018 between Faanberg and affected investors to approve informal liquidation.
At the time the company’s debts reportedly stood at N$200 million.
The fall of Faanbergh Properties affects and could lead to the loss of millions of dollars of other entities such as the Roman Catholic Hospital in Windhoek which invested N$17 million in the company.
Others are Benedictine Building Fund and Benedictine Sisters which invested N$4,5 million each, while Will Sell Family Trust Namibia invested N$2 million. Shanghala is allegedly using the funds’ failed investment into a property company as a reason to push for reforms to give politicians powers to decide investments on behalf of heirs.
Some fear that this amendment could backfire and put children’s inheritance at the mercy of politicians who have a history of turning a blind eye on blatant corruption of state investment funds.
Deputy auditor general Goms Menette told last week that their office will only audit the Guardian Fund as of next year.
Menette said his office struggled to get information from the master of the High Court.
The auditor general checked the Guardian Fund finances in 2010 for the 2005 to 2010 financial years. The auditor general concluded in that report that “I am unable to form an opinion as to whether these financial statements fairly present the financial position of the fund in the manner required by the State Finance Act,”
The auditors also noted that the Guardian Fund has been ignoring the law which compels it to pay over all funds that have not been claimed for 30 years to the finance ministry. Beukes blamed the discrepancies in their financials to a lack of human resources and capacity in her office.
She confirmed that systems were not speaking to each other; hence the difference in figures.
Beukes told last week that her office currently has a three-year backlog in terms of updating its financial statements.
In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.
The Namibian uses AI tools to assist with improved quality, accuracy and efficiency, while maintaining editorial oversight and journalistic integrity.
Stay informed with The Namibian – your source for credible journalism. Get in-depth reporting and opinions for
only N$85 a month. Invest in journalism, invest in democracy –
Subscribe Now!
