· Ram fraudulently took over P90million from Choppies
· Board sets Ram’s disciplinary hearing for Friday
· Wants him out of the board or any other position in Choppies
· Ram personally enriched himself with over R128m in Choppies money
· Ram falsely inflated Choppies Net Asset value
· Ram fictitiously increased Choppies profits
Choppies Chairman, former president Festus Mogae has told suspended CEO that his conduct regarding the Choppies scandal disqualifies him from holding the position of CEO and/or being a member of the board of directors and/or an employee of Choppies in any position of trust, letter calling for Ramachandran Ottapathu’s disciplinary hearing reveals.
Mogae wrote to Ram yesterday (26 August) notifying him of a disciplinary hearing to be held this Friday 30th August in Sandton, Johannesburg SA. According to Mogae, Ram used his position to mislead the board while personally enriching himself using Choppies millions.
In March 2018, documents indicate that substantial stock deficits were discovered by Choppies former internal auditor. It emerges according to Mogae that the deficits were aimed at fictitiously increasing the profitability and falsely inflating the Net Asset Value (NAV) of the company shares, all orchestrated by Ram.
It was found that fictitious, simulated transactions were concluded in relation to sale of stock to disguise the historic stock deficit and to mislead the board, its shareholders and the lenders. The transactions entailed the sale of non-existent stock and a purported receipt of payment, the letter says.
Purported sales were reflected to the value of R128 545 232.92 (Over P92.5 million) from Choppies as seller, to Devland Cash & Carry (Pty) Ltd and ANE Western Cape (Pty)Ltd as purchasers. Both companies had common directors in M Gathoo and S Gathoo.
In order to disguise the sham, actual remittance of the same amount of money was paid back to Choppies by the Devland and ANE which in turn also required back a remittance from Choppies. The return remittance from Choppies was executed by yet another set of fictitious and sham transaction which entailed the purchase of 4 stores from ANE at market value. The four stores were purchased at an inflated price of R145 500 000 (about P104 760 000), but the fair value of the stores was no more than R45 972 562 (about P33 100 244), according to a letter authored by Mogae.
The initial purchase consideration was, without any factual basis increased by R90 million (About P64 800 000). These purchase considerations according to Mogae were never disclosed to the board or the auditors. Between January and May 2018 R123.3 million (Over P88.7 million) was paid to ANE disguised as payment to the four stores. Mogae said in reality, it was part payment for the return remittal of the non-existent stock which Choppies sold to ANE and Devland.
A further USD455 333 (around P5 million) was paid by Choppies to MGC International Trading LLC, a company based in Dubai, partly owned by Y Gathoo, director of Devland.
Source: THE BOTSWANA GAZETTE