(Namibia) — ESMERELDA Majiedt, accused of corruption, allegedly managed to outsmart not only AfriSam Cement’s internal controls but also outwitted international auditing firm Ernst & Young.
During the continuation of her bail application yesterday, it emerged that from the around 12 audits carried out by Ernst & Young over the four years during which the alleged corruption took place not a single irregularity was discovered. Moreover, “suspicions” among at least eight AfriSam staff members, including the financial controller and a management accountant, were never investigated.
AfriSam’s financial controller, Yvette Olen, testified in the Windhoek Magistrate’s Court that at least N$75 million (US$11 million) may have been involved. The initial figure mentioned was N$71 million (US$10.5 milllion).
Olen testified that alarm was raised when Majiedt wrote off stock to the value of N$13 million (US$1.9 million) in January after which a forensic probe was conducted.
According to Olen, Majiedt had no authority to do the write-off. She allegedly “disguised it as a stock write-off”.
Olen described this as “highly irregular. You cannot offset a stock write-off against a provision account with which you pay transport.”
Apart from the write-off, Majiedt allegedly used the transport provision account to transfer credits to Cool Properties and Discount Hardware – two Rundu-based companies.
As a result, she was allegedly able to have truckloads of cement released to these two companies without AfriSam receiving a single penny for it, Olen testified. When the forensic investigation revealed that no proof of payment of N$16 million ($US2.35 milion) worth of cement could be traced from Cool Properties, its owner, Calvyn Bezuidenhoudt, allegedly informed Olen that he “never bought cement from AfriSam, but bought it from Esmé (Majiedt) and paid in cash”. This came after Olen asked him to either produce proof of payment or pay up.
Initially, Daniel de Jesus of Discount Hardware was quiet about their seemingly outstanding account of N$42 million (US$6.2 million) of cement. After newspaper reports about the alleged corruption, his lawyers, Metcalfe Attorneys, informed Olen that they also did not owe AfriSam anything, Olen testified.
Cool Properties and Discount Hardware were both cash clients. This meant that they had to pay for their cement in advance before the goods could be dispatched.
Olen testified that although reconciliations of the transport provision account were requested from Majiedt she never provided these. It is alleged that she used this account as the main vehicle for her alleged corruption.
When the AfriSam Namibia country manager, Johan Burger, was questioned about the high freight charges reflected in the account, he allegedly referred queries to Majiedt “who always had an answer”.
Olen testified that the amount involved “could be close to N$75 million (US$11 million), because there were also other customers who got some benefits”.
During cross-examination by Advocate Louis Botes, Olen claimed that had Majiedt given out her computer system password to her colleagues, she committed a dismissal offence.
Olen said Majiedt apparently also told the South African staff “not to interfere with [Namibian] customers as they (Majiedt and other Namibian personnel) are closer to the customers and the customers don’t like that (interference)”.
The alleged irregularities were not detected by Ernst & Young during any of their audits, because they “did not do transaction reviews”, Olen testified. “They decided that that is what their audit plan would entail.”
According to Olen, “it is a disappointment” that AfriSam’s internal controllers did not pick up the alleged corruption. “These transactions were cleared and once they were cleared, they did not stand out on the system.”
Also, she said, “based on what I can gather, there were no stock-takes done by Ernst & Young”.
Botes told her that although “nothing in life seems impossible”, he finds it “improbable” that the alleged irregularities went unnoticed “especially having regard to the time period”.
Olen answered: “If there is collusion, such things are possible. You must remember a lot of it only washed out in January. I am saying there may have been collusion between outsiders and people in AfriSam. Esmé (Majiedt) did a very good job of clearing transactions.”
Olen admitted that based on “humanitarian aspects” she would not be against Majiedt, with whom she had “an amicable, working relationship”, from being released on bail.
The bail application before Magistrate Ruth Herunga continues today. Public Prosecutor Hans Thourob represents the State, while Botes acts for Majiedt on instruction of Bradley Basson.
By: DENVER KISTING