Livestock dependent farmers in the highlands of the country have been left in abject poverty after the Park Homes project that was intended to combat animal theft has been abandoned.
The project was launched in 2018 by the Ministry of Home Affairs to ease stolen livestock identification and recovery. “The park homes were supposed to function as offices and facilities for livestock registration, tattooing and branding,” said the ministry’s principal secretary, Tumelo Raboletsi.
The project stretched to different districts, but Lot 5 is the project in question. This project was supposed to be implemented in Thaba Tseka and Qacha’s Nek districts at a cost of M7.8-million.
The villages involved under this lot were Ha Sekake, Sehlabathebe, ‘Melikane, Matebeng, Lesobeng, Sehonghong, Ha Makoto, Bobete, Matšonyane, Makunyapane, and Manamaneng/Linakaneng.
Legends Construction, the Lot 5 contractor, abandoned the project in April 2019 after being allegedly duped out of M7.1 million by its funder, MNN Centre for Investigative Journalism has learnt. This happened on the same day that Home Affairs made a contentious payment into the contractor’s bank account.
Legends director, Monaheng Letsie, told MNN that when his company ditched the project, they had only completed 40% with park homes yet to be constructed in ‘Melikane, Ha Sekake and Sehlabathebe.
These developments have dashed the hopes of farmers who believed the project would help them combat the stock-theft crisis in their area.
Khobo Letsoma, a 64-year-old ‘Melikane Cliniking resident and a father of five, told MNN that after his cattle were stolen in 2019 he has felt like a castrated man with no means to provide for his family.
‘Melikane is a cattle rustling hotspot in Qacha’s Nek. It is a vast region stretching miles across mountains and it takes five to six hours to travel from one village to another. The isolated communities in that region rely heavily on livestock as their sole source of income, including for field plowing, goods transportation, hide tanning and wool and mohair sales.
“Animals serve a variety of functions for us. This is our way of earning a living. So, when we wake up to discover that they have vanished, it means that our money and our means of subsistence have vanished as well,” said Leeto Khanya, the chief of Ha Khanya in ‘Melikane.
Letsoma’s house, though average in size, is rundown and constructed of metamorphic rock, which is common in the area. His two large kraals are a stone’s throw from his house, but they are empty and in disrepair.
Speaking to MNN he said that he was able to purchase his cows years ago after landing a school feeding catering job. Now he has lost his wealth and he has been unable to start over, partly because of his age.
“’How are we going to survive now that you are idle?’ my wife asked me as the head of the household before she left for domestic work in South Africa. My spirit is not well, theft of my cattle has turned me into a beggar,” Letsoma explained. “There are days when we go to bed on an empty stomach.”
Chief Khanya who believes branding and tattooing can help his subjects to recover their stolen animals told MNN that the last time their area received these services was in 2017.
“Ever since then, the people of Melikane have been using outdated custom ear-cuts to mark their livestock,” he said.
“Livestock earmarking and some [uncoordinated] branding across districts has been a nightmare for the police…,” police spokesperson, Senior Superintendent Mpiti Mopeli told MNN in a separate interview.
In the absence of government coordinated marking services, the ‘Melikane farmers have banded together to form an anti-stock theft association, which helps them trace and recover stolen animals.
The association’s chairperson, Morapeli Lekeno says: “Tattooed animals are easy to identify and marks cannot be easily doctored or removed unless one cuts off the animal’s ear, which would signify they were stolen. However, the same cannot apply to knife-cut markings, the cuts can simply be altered.”
Another farmer, Mothibe Moea, who has lost 12 cows since 2012 said that through their anti-stock theft association association tattooed animals have been recovered from various auctions in South Africa with the help of the police.
According to Moea, stolen animals in ‘Melikane are usually ferried to Cedarville, Eastern Cape province in South Africa where livestock auctions are held.
“Thieves would keep the animals there before auctioning them off,” Moea said, adding that they now work with a counterpart association in South Africa, which has helped them stem the problem. “We get tip-offs on auction dates and we are able to retrieve them before they are auctioned,” he said.
South African association chairperson, Siyabonga Dlamini, corroborated Moea saying that it’s easier for them to identify Lesotho animals when they are tattooed or branded.
Letsie, Legends Construction director, suspects their company was defrauded of the M7.1-million by a controversial naturalised Chinese businessman, Yan ‘John’ Xie, because following payment, the money was immediately transferred into the account of his supermarket, First Choice, according to court documents seen by MNN.
To carry this project, Letsie said Xie lent them money at 25% interest. Accoridng to the Central Bank of Lesotho, the formal lending rate is at 8,56%, which by any regulated standards makes Xie’s lending rate highly questionable. Letsie says there was no figure agreed upon as it would be determined by labour and material costs. “We spent about M9-million on the Legends Construction, plus taxes, it went over M10-million,” Xie told MNN in a separate interview.
To protect his interest, Letsie said Xie “took 51 percent shareholding [in Legends Construction]” through his company, Bafani Construction, which became major shareholder.
The two companies then sealed a financing deal that gave both of their representative companies signatory powers in Legends Construction.
Legends’ administrator, Thuso Bataung, said he had his doubts about Xie’s intentions from the onset but did not act as the motive was not clear. “It appeared as if the project belonged to John [Xie] yet his company did not win the tender,” he told MNN.
“Home Affairs engineers were always in the dark whenever we sought clarity on project issues from them, John is the one who knew everything,” Bataung added.
Letsie told MNN that during the tender process a local bank committed to lend them up to M10-million to deliver the project. However, Home Affairs gave them only a month to prepare, which meant they resorted to Xie for funding, after being connected to him by ‘Machabana who was the ministry’s principal secretary at that time.
‘Machabana denied this, saying: “all the companies that won the tender made the same deal with John [Xie], it had nothing to do with me”. She also said that the one month preparatory period is standard for all tenders and includes an additional fifteen day period during which those who are successful can make queries.
Xie admits that Legends Construction was referred to him by Home Affairs officials. He said: “many times these companies win tenders but have no funds to execute them. People from the ministry told them to come to John because they knew we help many companies”.
Letsie alleges Xie connived with ‘Machabana for the payment to be made and transferred to him. But Xie insisted that he had no special relations with ‘Machabana.
According to ‘Machabana, the M7.1-million issued by her ministry to Legends was 90 percent payment for delivery of the overall park homes project. She denies having issued the payment under Xie’s influence.
But Letsie says when his company received the payment, it had delivered only 40 percent of the project. “[This was] against our agreement that they pay us when 90 percent of the project was completed,” he said.
He said that evaluation of their project execution and inspection were among the conditions for Home Affairs to pay them. However, “there was never an inspection…not even a single site visit by Home Affairs when the payment was done”.
Letsie said that what was even more disturbing was that he had not even claimed payment from the ministry, yet on May 13, 2019 M7.1-million was deposited into his company account. He later learnt it was Xie who had made the claim for payment from the department.
“We approached the Principal Secretary Office to get clarity on how the claim was received and paid, yet only 40 percent of the work was done, but she [‘Machabana] was not amenable to discussions on the issue,” Letsie said.
Xie in turn blamed Legends management for alleged mismanagement of funds, which he claims resulted in losses to the entire project.
He said that during their financing, he found that Legends withdrew M900 000 for a service that was quoted at M200 000. “We requested them to hand over their site to us to complete the project having realised that they were running huge loss. We had already lost M7-million on Lot 5 alone”.
According to Letsie, he spent M900 000 in labour costs because John suddenly changed the contractual terms with Legends, making him pay for workers daily, instead of by “stock”, which is a once-off payment and is cheaper. Letsie said that by refusing his way of working, John deliberately made things more expensive, ultimately squeezing him out of business.
Through a similar arrangement as with Legends, Xie funded other companies participating in the parks home project. Xie told MNN that they were facing similar problems but unlike Legends Construction, they had agreed to hand over their sites to him to complete.
“Only Legends refused to hand over their site to us. He [Letsie] said for his project, he wanted money. We’re not supposed to be responsible for how they made money… like with the bank, if they failed, they still had to pay us back,” Xie said.
Notwithstanding these revelations, ‘Machabana insisted that when she issued payments, all companies contracted in different lots of the project were paid 90 percent because they had met 90 percent of their targets.
However, MNN visited ‘Melikane, Ha Sekake, and Sehlabathebe, and found that in fact no park homes have been built.
“The documents at the office of Home Affairs show that 90 percent of the work was done. I do not evaluate the projects hence I did not have to do site visits and relied on project files. There were about 40 files in all,” ‘Machabana told MNN.
Pressed to reveal names of people who inspected and evaluated the Legends project, ‘Machabana said she did not know people by names.
Astoundingly, ‘Machabana admitted that Xie had completed all the tender documents for the projects he had lent money on, a seemingly gross conflict of interest. “Their tender documents are identical…created at the same place…and carried out by ‘John’ of theirs”.
Legends Construction is challenging Xie in court on charges of fraud. But because Xie was referred to as John [nickname] in court papers, Director at Bafani Construction, Shen Yao (and Xie’s brother-in-law), said in his founding affidavit that the man Letsie refers to as “John” has never been part of the finance agreement between Bafani and Legend Construction and that Bafani does not have a John in its administrative structures.
According to the companies register, Xie forfeited his shareholding in Bafani Construction on August 1, 2017 before he was appointed Head of Special Projects and the Prime Minister’s Special Envoy and Trade Advisor on China-Asia Trade Network by former Prime Minister Thomas Thabane. The same happened with his other companies, which were left with his wife and Shen Yao. MNN understands, however, that he continued to run them from behind the scenes.
While the case is still pending in court, Home Affairs was directed in a court interim order to stop paying the remaining balance of 10% into Legends Construction’s account. First National Bank was also ordered to freeze and withhold funds in the same company’s account.
For Home Affairs to hold perpetrators accountable, Minister Motlalentoa Letsosa told MNN that they are awaiting court’s decision on this case. “As the Ministry, we have decided that the court will help us solve this impasse. That’s where we are,” he said.
To complete the assignment, the government will have to dig deep into its coffers for additional funds. Principal Secretary Raboletsi stated that they will request additional funds and expect them to be included in the next fiscal year’s budget.