CABINET ALLEGEDLY STOPS FSRA PROBE INTO PSPF

MBABANE – The application by FSRA to be allowed to continue with its investigations into the affairs of Public Service Pension Fund (PSPF) has been withdrawn.

FSRA is the acronym of Financial Service Regulatory Authority. The withdrawal of the application by FSRA comes after an alleged instruction from Cabinet. The application was withdrawn by FSRA lawyers yesterday.
the Minister of Public Service Owen Nxumalo, whose portfolio the PSPF falls under, when interviewed yesterday confirmed that he had reported the latest developments to Cabinet.

He said he could, however, not go into detail about what transpired, but said he had also informed the Deputy Prime Minister (DPM) Paul Dlamini about the matter. “Yes, the matter was discussed at Cabinet and that is all I can say,” said Nxumalo.     
PSPF is one of the government parastatals which falls under the Ministry of Public Service. FSRA lawyer Nkosinathi Manzini only confirmed that the application has been withdrawn and a correspondence to that effect has been sent to PSPF legal representatives.

Meanwhile, the DPM said the matter was under Nxumalo’s portfolio and he was the minister who was in the best position to go into detail about it.  He did, however; acknowledge that he was aware of the matter. 
FSRA ran to court after PSPF allegedly adopted an obstructive stance by instructing its officers not to cooperate with its investigating team.  According to FSRA, its team of investigators was allegedly met with resistance from PSPF officers.

FSRA, as a regulator for retirement funds and financial services providers, is responsible for ensuring that all retirement funds, fund administrators, investment managers and anyone associated with them, conduct the business in accordance with the law and principle governing the industry.

So far, the investigations, according to FSRA, had unearthed that huge loans were granted to entities without any loan agreements and supporting documents. It was also allegedly discovered that PSPF appointed an auditor without the approval of the Board at the tabling of the entity’s financial statement, which according to FSRA, was in contravention of principles of corporate governance.

The team of investigators from FSRA further found that PSPF allegedly took major investment decisions in relation to certain major acquisitions without the involvement of its Investment Committee. “The respondent (PSPF) disinvested large sums of funds from local financial institutions to offshore destinations,” reads one of the findings made by FSRA.

FSRA Chief Executive Officer (CEO) Sandile Dlamini, in his affidavit, stated that the preliminary findings that had been already made, suggested that there was a need for more intensive investigations into certain other areas, not discounting the inspection that had been carried out.

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