(MENAFN- The Post) MASERU -THE Directorate on Corruption and Economic Offences (DCEO) on Monday froze the bank accounts of the Lesotho Stone Enterprise (Pty) Ltd.
The DCEO obtained a court order to freeze the company''s bank accounts and seize its assets while investigating it for money laundering, corruption, fraud and tax evasion.
On the same day the DCEO also raided a company belonging to one of the directors, Decorat Art Furniture Manufacturer, and seized computers and cash.
However, the company''s shareholders in a letter to Prime Minister Moeketsi Majoro said the DCEO could be acting at the insistence of John Xie, a controversial businessman of Chinese descent.
Xie is a former adviser to former Prime Minister Thomas Thabane.
The assets which were seized include the sandstone mine in Lekokoaneng and two developed sites in Ha-Matala and Europa in Maseru.
The frozen bank accounts are held with Standard Lesotho Bank and First National Bank.
No one is allowed to dispose of, encumber, dissipate, interfere with, attach or sell in execution, diminish the value of or deal in any manner with the property.
The DCEO has also seized a site which it says was bought with proceeds of crime, bought in the names Tšepiso Mofolo which is next to Thabane''s house in Ha-Abia.
The other site located in Happy Villa, which belonged to the Qhobela family, was sold to one company related to Lesotho Stone Enterprise.
The DCEO said its plan is for the sites to be sold by the courts and the money added to the public revenue.
It said the company has bank accounts in South Africa and China where it has property too that the DCEO is tracing to find if it was not bought with money from Lesotho.
''We now have the locations of such properties,'' the DCEO boss Advocate Mahlomola Manyokole told a press conference yesterday.
High Court judge Justice Thamsanqa Nomncongo has placed the property ''under the effective control of the curator bonis, Mr Junwei Wang of Bloemfontein''.
Wang, according to the order, ''shall open a curatorship bank account and transfer the funds in the Lesotho Stone bank accounts'' for operational purposes.
Wang will be paid his fees from the Criminal Asset Recovery Fund or from the forfeited property if a forfeiture order is made or by the government if no forfeiture order is made.
The DCEO is also looking into how the company''s licence was renewed and extended in 2017 yet they still failed to comply with conditions set by the Ministry of Tourism.
Advocate Manyokole said the investigations show that the company had renewed its licence through fraudulent means and that their auditing too was fraudulent.
Advocate Manyokole said they set up a team made up of a prosecutor, the assets recovery office and investigations office to probe the company.
He said Lesotho has lost over M40 million on royalties as the company has been cheating.
''I am not talking about small amounts of bribes and other corrupt means,'' Advocate Manyokole said.
He said in 2017 the company asked for a renewal of their mining lease from the Ministry of Mining and it was supposed to have passed an Environment Impact Assessment with the Ministry of Tourism before acquiring the lease.
''The Lekoakoaneng community had complained of dust pollution from the mine and the local chiefs and councillors tabled their discontent about the mine,'' he said.
He said after the community complained the Tourism Ministry introduced a new set of conditions which the mine had to meet but the company failed to comply.
''Because they failed to meet the conditions their licence would not be renewed until they paid bribes to some government officials who renewed it without the board''s consent,'' he said.
Advocate Manyokole said the mining board was misled into believing that things were okay and the conditions had been met.
He added that the Lesotho Stone Enterprise cheated by inflating its operational costs so that it did not pay a fitting amount of tax.
''There is a long chain of corruption in the company licence renewal as some high-ranking officers are (also) involved,'' Advocate Manyokole said.
He said on Monday they raided Decorat Art Furniture Manufacturer in Maseru West Industrial Area where they seized some property that they thought would be important for their investigations.
The company is owned by a couple that bought the Happy Villa house the DCEO has attached.
''They are now Basotho through naturalisation,'' Advocate Manyokole said.
He said they also raided Lekokoaneng offices and the Happy Villa house.
He said the South African Reserve Bank had frozen M3 million belonging to the same company due to suspicious transactions to China.
However, the company has appealed to Prime Minister Majoro to intervene saying the DCEO could be under the influence of John Xie.
In the letter sent to Dr Majoro yesterday, the company''s director Zhai Fengfu said the DCEO has been tormenting them since September 2018 after their fallout with Xie.
Fengfu said the DCEO raided them and ''took all books of accounts, correspondence related to sales and company computers''.
Fengfu said they were unable to operate after that and the DCEO promised to bring back the computers but never did.
''And the net effect of this is that we were not able to complete our mandate of taxes with LRA,'' Fengfu said.
He said they were shocked when they found that their accounts at FNB and Standard Bank had been frozen.
He said about 200 Basotho workers'' jobs are at stake.
At Decorat Furniture over 50 workers'' jobs are on the line.
He said the DCEO has seized about M50 000 from the company, personal documents and IDs of some workers.
But what seems to have irked Fengfu and other shareholders more is the engagement of a Chinese man Wang Junwei from Bloemfontein.
He said they had now concluded that Junwei is a ''business partner of Mr Xie Yan (John)''.
Fengfu told Dr Majoro that Xie and some officials at the Ministry of Tourism have an interest in taking over the Lesotho Stone Enterprise.
''It is the same ministry that issued contracts of Convention Centre to Mr Xie Yan,'' Fengfu said.
''Two weeks before the DCEO seized Lesotho Stone Enterprise and search Decorat Art Furniture, I received a call from Mr Xie Yan…complaining about Lesotho Stone still owing him money,'' he said.
Fengfu said he was surprised because ''I never got a call from him for many years''.
Xie is a former shareholder of Lesotho Stone Enterprise, Fengfu said.
He said the shareholders suspected that Xie knew ahead of time that the DCEO was going to seize the assets of the company.
They also suggested that Xie was aware that Junwei would take over the Lesotho Stone Enterprise.
Fengfu said the DCEO is abusing its power hence their appeal for Dr Majoro to intervene.
Efforts to contact Xie were not successful last night.
Nkheli Liphoto
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