A SOUTH African company is suing the state-owned Namib Desert Diamonds for N$2,1 million for terminating a contract that was meant to help the scandal-hit parastatal improve its governance systems.
The parastatal has since 2016 faced allegations of selling Namibian diamonds for values far below standards to territories such as Dubai, which is known for allowing the flow of dirty money.
Senior government officials said the consulting firm also believes that Namdia advertised the tender because it was being investigated by the public enterprises ministry at the time.
understands that the consulting firm, Bravo Compliance, believes Namdia terminated that contract because the company raised red flags about how the parastatal was selling its diamonds to foreign companies.
Namdia advertised a tender in January 2018 for a private company to establish a system meant to evaluate and improve the parastatal’s risk management, control, compliance and governance processes.
“The consultant will mainly be responsible for preparing a risk management framework/plan detailing the risk strategy process and techniques to be used, as well as corporate governance systems practice and the development of a best practice/governance transformation plan,” the advert said.
Namdia awarded the contract to the South Africa-registered company (Bravo Compliance) on 22 March 2018.
High Court documents show that Bravo Compliance filed a lawsuit on 21 January 2019.
It is demanding that Namdia pays it N$2,1 million for terminating the contract mid-stream.
The South African firm also said Namdia breached the contract when it failed to pay around N$300 000 by 1 June 2018 for work which includes N$200 000 for software bought from Cura Risk Management Software Property Limited.
According to the court papers, Namdia informed Bravo Compliance on 1 June 2018 that the parastatal had cancelled the contract because it was awarded based on misinterpretation, and that the tender process should start afresh.
Bravo Compliance said Namdia offered it N$400 000 as a settlement for cancelling the contract if the money was paid by 8 July 2018. The company said Namdia offered N$800 000 if the payment was made after 8 July 2018.
The South African firm said Namdia failed to honour this promise.
Documents filed at the High Court show that Namdia wrote to Bravo Compliance on 31 July 2018, saying they had calculated that the parastatal only owed the company N$39 500, and that such funds would be paid by 3 August 2018.
This amount, Namdia said, was calculated based on the work done by Bravo Compliance, a version denied by the risk management company.
In addition to the N$300 000, Bravo Compliance claims to have suffered damages of N$1,8 million for work which would have been done last year. This includes N$1,3 million for the designing, development and implementation of management systems.
Namdia chief executive Kennedy Hamutenya did not respond to questions sent to him yesterday.
reported in October 2016 that Namdia secretly started operating on 18 April 2016, and its board, appointed by mines minister Obeth Kandjoze, was never made public until this newspaper asked him for the names.
Bravo Compliance claims in its court papers that Namdia started operating in 2016 “with no formal compliance framework, or programme”.
Namdia advertised the tender a month after president Hage Geingob announced in December 2017 that he had instructed public enterprises minister Leon Jooste to investigate Namdia.
Sources said Jooste looked at governance issues at Namdia, and submitted the final report to Geingob, who has kept it to himself since last year.
Namdia has for years sold diamonds valued at more than N$3 billion to secret companies abroad. There are still concerns that some senior officials had their palms greased from Namdia deals. The company denied any wrongdoing, but it has insisted that it will not reveal its buyers to the public.
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