Avid corruption case pre-sentencing date set for the 16th of May

Judge Christie Liebenberg has set the 16th of May as the date to fix the presentencing date for convicted former MP, Nicolaas Josea, and other co-accused in the Avid corruption trial in which N$30 million of state funds were plundered from Social Security Commission (SSC).

Josea was last week Friday found guilty of theft of SSC money meant for investment and attempts by his lawyer to have his initial N$30 000 bail increased to N$40 000 were thrown off the window.

The judge considered chances of his being a flight risk as having increased substantially given the fact that his situation had changed with the passing of the ruling.

The bruised Josea was escorted by officials for detention at the Windhoek Correctional Facility soon after the court ruling.

Former Swapo National Assembly members Paulus Kapia and Ralph Blaauw were also found guilty of fraud as well as former Avid board chairperson, Inez /Gases.

Blaauw’s wife and lawyer, Sharon Blaauw, was also found guilty of reckless conduct of business while former Avid director and lawyer Otniel Podewiltz and retired army brigadier, Mathias Shiweda were acquitted of fraudulent conduct of business.

The convicted four successfully had their N$10 000 bail reinstated on the same conditions after the court found that they were not flight risks and had religiously attended court proceedings.

Background to the case: The Kandara factor

The Avid corruption saga dates back 14 years ago when the late Lazarus Kandara captured the Avid management, imposing the self as de facto chief executive officer to swindle SSC out of N$30 million meant for investment.

Evidence has finally disclosed that of the N$30 million intended for investment by the SSC through Avid, N$29.5 million was transferred to Namangol, a company owned by Josea and has since been declared insolvent.

“At the outset the amount of N$3.2 million had been set aside for Kandara’s personal use,” said the judge.

It has also been proven that N$29.5 million was transferred to a South African based Alan Rosenberg after which Josea was given N$14 million which according to judge Liebenberg, “was spent abundantly within a short period of time.”

Said the judge, “This much is evident from a letter dated 07 February 2005 sent by Alan Rosenberg to Avid, purporting to be a guarantee bond assigned to Avid in the amount of N$30 million with a return value of N$31 476 494. This despite having received only N$20 million (and not the amount stated) which was recalled by Namangol after four days.”

“The instituting of court proceedings in South Africa between Namangol and Alan Rosenberg which, except for payment of N$15 million through his attorneys, seems to me to have been nothing more than a facade to re-route the investment away from Namangol and have the money transferred to accused no 7’s private account, under the guise of a loan advanced by Kandara.”

“On paper the investment of N$20 million was made by Namangol, according to which the money had to be returned to Namangol as lawful owner/possessor when recalled, no one else. At this stage Kandara had no say over the money and neither could it legally have been paid into accused no 7’s private account.”

It has come to light that Josea’s protracted explanation that the N$29.5 million he got was part of a loan he got from Kandara on the strength of a promise by Rosenberg to repay him from funds due in the sum of US$38.8 (as set out in a Settlement Agreement), was not supported by any other (reliable) evidence and was rejected by the court as false.

The judge also said that Josea was part of a premeditated plan to syphon state funds from the start and worked in cahoots with Kandara despite playing innocent in his defence.

The judge ruled that Josea, Kandara and Rosenberg had no intention to return the money back to its owners and deprived Avid or the SSC of their lawful possession and ownership of the funds.

“Instead, there is overwhelming evidence showing that during his dealings with Kandara and Alan Rosenberg, he knew that the SSC’s money had been stolen,” ruled the judge.

Instead of refunding the SSC for their loss, the judge ruled that Josea was unable to satisfactorily explain why he to date never followed up on the investment.

Said judge Liebenberg, “The best he could do was to explain that it never materialised because of the liquidation of Namangol and his personal sequestration. When reminded that it would have been all the more reasonable to tell the liquidator about the investment which could salvage his company and himself from downfall, he said that he actually did, but nothing had come from it.”

“Had that indeed been the case, his counsel undoubtedly would have addressed it in cross-examination when the liquidator testified. In the circumstances it seems reasonable to infer that the reason for such failure was because the accused fabricated evidence about the offshore investment in an attempt to explain the so-called loan he got from Kandara.”

Judge Liebenberg said the recalling of the N$20 million investment a few days after it was made with no prospects of it being reinvested elsewhere, or returned to the investor, confirms the existence of a mutual agreement between Joseaand Kandara to misappropriate the funds, thereby permanently depriving the lawful owners or possessors of the money.

“As for accused no 7 (Josea), it would not involve the full amount but the actual amount of N$29.5 paid over to Namangol. In the result, I am satisfied that the State proved beyond reasonable doubt that accused no 7 has committed the offence of theft by conversion and should accordingly be convicted,” ruled the judge. 

How Avid was outsmarted and captured by Kandara

The judge found that Kandara had indeed successfully captured the leadership and operations of Avid by presenting himself as the company’s CEO although he had initially been presented as a mere advisor.

This is inspite of the court finding that Kandara had in fact little experience in investments besides possessing basic knowledge of the field.

Judge Liebenberg found that there was not a shred of evidence that he advised the board on any of the two investments made with Avid i.e. the Navachab deal and the SSC deal.

“Kandara was key in putting together the Board of Directors of Avid. In the recruitment of suitable directors Kandara was assisted by Mr Gordon Goeieman and accused no 5 (Ralph Blaauw), the latter having introduced accused no’s 1 (Kapia) and 6 (Shiweda) to Avid.”

“What is clear from the evidence of the SSC managers, the suspected involvement of Kandara in Avid was not only of great concern to them, but sufficiently important to suspend the whole deal,” said the judge.

According to /Gases the board had made no decision over the SSC money and everything was left to Kandara who was thought to do a good job given how he had successfully handled the Navachab deal.

Kandara thus went on, unhindered to loot SSC funds.

Photo credit: The Namibian