Scandal claims Namibian MP

Namibia’s latest financial investment scandal has claimed a Cabinet scalp.

Paulus Kapia, the Deputy Minister of Works, Transport and Communication, who only a few months ago was the most favoured foot soldier of former state President Sam Nujoma, has resigned over his role in an asset management company linked to the embezzlement of a R30-million investment of the Social Security Commission (SSC). The SSC is a state welfare agency run on monthly tax levies on employers and workers. Its revenue is used to pay for maternity leave, medical, work disability, retirement and death benefits.

The SSC management claims that Kapia, the head of the ruling party’s youth wing and Ralph Blaauw, secretary general of the National Youth Council until he too quit this week, pressured it to give Avid Investment R30-million to invest in January.
The investment was due to mature in May, with promised returns of 14,5% interest. Avid has failed to repay the money and evidence has emerged that the funds may have gone into the pockets of unscrupulous individuals in Namibia and South Africa.

Kapia was a director of the start-up asset management company set up by Lazarus Kandara, a shady insurance broker who was blacklisted by the SSC four years ago. Kandara committed suicide last Wednesday while in police custody. He had kept his role as CEO discreet, but picked politically connected people such as Kapia, Blaauw’s wife, Sharon, and army Brigadier Mathias Shiweda to tout for business.

Kandara, working through another Namibian firm, Namangol Investment, sent the SSC money to a dubious South African investor, Alan Rosenberg, with the promise of investing in high-yielding off-shore instruments. But the Namibian High Court has since learnt that the owner of Namangol Investment had repatriated R15-million to Namibia, which was squandered on friends, churches, cars and diamonds.

Before he shot himself, Kandara testified in court that he paid the directors, including Kapia, R40 000 each in “commission” for generating business for Avid.

After Avid failed to repay the R30-million investments with interest, the SSC applied to the court for a liquidation order. During court proceedings there have been claims that Nujoma was a clandestine shareholder in Avid, and that the Swapo Youth League too held a substantial number of shares in the company. The ruling party has dismissed these claims, despite Kapia’s insistence that the shares were in the process of being allocated when the scam broke into the open.

Kapia’s political currency is on the wane. He has come under increasing pressure within the ruling party, where he is reputed to have made many enemies for being Nujoma’s hatchet man. He is also notorious for his rhetoric against the media and the judiciary, which he has called agents of Western imperialism.

But of late even Nujoma has been angered by the Avid saga and has called on Kapia to clear his name.

As a growing sign of Kapia’s isolation, the Swapo Youth League national executive committee this week began moves to oust him from his position as secretary. There is even talk of a complete expulsion within a week. It is doubtful that he will retain his seat in Parliament as a ruling party public representative as more revelations emerge of him using the Swapo name to peddle influence and his attempts to cover up his relations with Kandara.

The high court hearing into Avid’s liquidation is expected to continue next week with evidence to be submitted about Alan Rosenberg, the South African investment manager whom SSC lawyers have described as dishonest.

This SSC deal is one of two embarrassing investments involving state-owned organisations that have rocked Namibia. The government is still in the dark about R100-million that was allocated to a company of South Africans that was registered in Botswana as a micro-lender. The company, Great Triangle Investments, chaired by the former chief executive of the Amatola Water Board in the Eastern Cape, Phillip Fourie, has failed to pay back the money that the Offshore Development Company, another state entity, had invested with it in 2003.

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