Conflict of interest issue stalks Lebitsa
MAFETENG – The chairperson of the Lesotho Communications Authority (LCA), Puleng Lebitsa, has shares in Toro Investment Holdings which has a stake in the Sekhametsi Investment Consortium, Public Eye can reveal. Sekhametsi Investment Consortium owns 20 percent of Vodacom Lesotho (VCL) – the country’s leading telecommunications firm which is directly regulated by LCA, which raises serious conflict of interest issues.
Lebitsa declined to comment when contacted this week. “May I not comment on this issue please? What you are asking me about is very complicated,” she said. LCA is a statutory body, established in June 2000, with the mandate of regulating the communications sector in Lesotho. Its mandate entails: granting licences to operators, promoting fair competition, approving tariffs, empowering and protecting consumers, among others.
As a regulator, LCA has to ensure impartiality when engaging with telecommunication companies. VCL reportedly has a market share of 85 percent and is majority-owned by Vodacom Group Limited (80 percent) while Sekhametsi Investment Consortium owns the remaining 20 percent. Toro Investment Holdings owns 3 037 shares in Sekhametsi. Lebitsa owns 913 of Toro Investment Holdings shares, according to the records this publication obtained from the Ministry of Trade’s companies’ registry.
This means that some of the profits made by VCL eventually end up in Lebitsa’s pocket, yet she leads an institution that approves the tariffs VCL charges its customers. This hard-to-believe setup started last year, hardly a year after LCA announced it had revoked VCL’s licence in October 2020. When its licence was revoked, VCL went to court and successfully ensured LCA’s decision was reversed after it won an interim court order. The matter remains unresolved. “Notice is hereby given of the revocation of the Unified Licence of Vodacom Lesotho PTY Ltd in accordance with Section 47(1)(e) of the Communications Act, 2012, read with conditions 7(c) and 8 of the terms of licence for failure to comply with the directive to pay a penalty of M40 200 000 by October 7, 2020,” LCA said in a statement in October 2020.
The authority said the notice was published in accordance with condition 8 of the unified licence. VCL was fined a staggering M134 million for allegedly violating licence. The fine was imposed by LCA, citing a battery of transgressions it said VCL committed since 2016. In a September 28, 2020 letter to VCL, then LCA Chief Executive Officer ’Mamarame Matela instructed the company to immediately pay M40.2 million or 30 percent of the fine.
Matela, however, said the other M93.8 million (70 percent) of the fine was suspended for five years on condition that VCL “does not commit any further contraventions during the said period.” In court papers, LCA lawyer Advocate Thabo Mpaka, reportedly blasted Vodacom for allegedly hiding behind politicians instead of dealing with the charges that the LCA had levelled against it. Matela was suspended from her position of CEO about eight months later, on June 3, 2021, by the then Minister of Communications, Science and Technology, Keketso Sello, on allegations of corruption or irregular involvement in the tendering process and award of a tender to an international company, Global Voice Group.
Her suspension letter revealed that the LCA board resolved in its meeting held on June 2, last year that an investigation into the award of the tender should be conducted. The board also resolved that her presence in the workplace during the period of investigation would not be viable. It, therefore, further resolved that she be placed under precautionary suspension pending the outcome of the investigation. This was a few days after Motanyane Makara’s membership and chairmanship of the LCA board was terminated on May 31, 2021.
Makara was fired as chairperson of LCA principally on three grounds – alleged incompetence to act as chairman of the board, irretrievable breakdown of the working relationship with Sello and suspicious relationship with Matela. Upon Matela’s suspension, Sello appointed Nizan Goolam as acting CEO of LCA. Goolam’s brother, Brey Goolam, owns 304 shares in Sekhametsi Investment Consortium, according to documents Public Eye obtained from the Ministry of Trade this week. Sello was removed from the ministry of communications on June 4, and transferred to the Ministry of Public Service to be replaced with Tšoinyana Rapapa.
Rapapa then appointed Lebitsa, whose company has shares in Sekhametsi Investment Consortium, as chairperson of LCA. Unperturbed by the apparent conflict of interest, the communications minister was dismissive when asked to comment yesterday. “Yes, I am aware of Lebitsa’s investments in Toro and I am comfortable with that. “I don’t see any conflict in her having invested in the company and the position she holds now at LCA.”