Ex-August 26 manager to answer N$26m case
Court dismisses absolution application
Former August 26 Textiles and Garment Factory finance manager Paulus Weyulu Moshana and three companies linked to him must answer to allegations that they siphoned N$26 million from the state-owned textile company through fraudulent transactions between 2015 and 2018.
This after the High Court last week dismissed applications by Moshana at the companies which sought absolution from the instance in the embezzlement matter.
The ruling, delivered by Judge Nate Ndauendapo, means the defendants must now answer to allegations that they siphoned the millions.
August 26 Textiles – a subsidiary of August 26 Holdings under the ministry of defence – claims that Moshana, while serving as finance, human resources and administration manager, authorised and processed payments to Veer Investments (Pty) Ltd, Vuma Investments CC, and Proficient Investments CC, all allegedly linked to him, for services that were never rendered.
Plaintiff’s testimony
Testifying for the plaintiff, managing director Silas Chicken Amunyela said that when he joined the company on 1 June 2017, he immediately noticed discrepancies in procurement and financial reporting.
He told the court that the company had three departments, each headed by a manager — with Moshana in charge of finance, HR and administration. When Amunyela requested departmental reports, Moshana failed to submit his.
By September 2017, during a management meeting, it became clear that proper procurement procedures were being ignored. Amunyela instituted a policy requiring at least three quotations for any purchase — a move that exposed several irregularities.
In July 2018, a warehouse supervisor presented him with a N$670 000 invoice from Proficient Investments for repairs to a genset. Suspicious of the amount, Amunyela sourced a comparative quote from Pupkewitz MegaTech, which priced the same work at only N$11 651.
His own review of the company’s bank statements revealed that large payments had been made to three entities: Veer Investments (N$3.4 million), Vuma Investments (N$2.8 million), and Proficient Investments (N$1.2 million). All transactions, he testified, were processed by Moshana and approved under questionable circumstances.
“There was no contract between August 26 Textiles and these suppliers,” he told the court, adding that some payments occurred before his appointment. He reported his findings to August 26 Holdings CEO, Colonel (Ret) George Kaxuxuena, who directed him to open a criminal case.
A forensic investigation by PricewaterhouseCoopers (PwC) confirmed the misappropriation of funds, concluding that payments were made to suppliers who never provided services. The audit revealed 713 supplier transactions worth over N$19.6 million that could not be traced or verified in the company’s system.
PwC’s team leader, Hans Friedrich Hashagen, testified that the finance manager bore responsibility for ensuring accountability for all transactions. He said some invoices were paid twice, others before their issue date, and many had no proof of payment or quotations attached.
Hashagen further revealed that Moshana had undisclosed business interests with companies trading with August 26 Textiles, including Veer Investments.
Another witness, Beverly Kaposiao, who served as general manager for production, testified that she was unaware of certain invoices issued to the company by Veer Investments. One invoice, dated 5 May 2016, charged N$220 000 for embroidery and T-shirt printing — services which, she said, were performed in-house and did not need outsourcing.
Defence arguments
Moshana and his co-defendants, through their lawyers, denied wrongdoing and argued that the claims had prescribed in terms of the Prescription Act.
Moshana’s lawyers argued that there was no direct evidence linking his client to the alleged unlawful payments, adding that the forensic report relied on hearsay and covered a period before Moshana’s employment began in 2011.
They also maintained that the applicants in the matter failed to prove that Moshana violated internal procedures or personally benefitted from any payments.
On behalf of the second defendant, Veer Investments, lawyer Profysen Muluti insisted that the company provided legitimate goods and services, and that the plaintiff’s claims for payments made between 2015 and 2017 had already prescribed.
Muluti cited Kapuka v Haufiku and Uitenhage Municipality v Molloy, arguing that August 26 Textiles should have identified irregular payments during its routine audits. He further claimed that only three payments made during Amunyela’s tenure — totalling N$701 109 — fell within the claim period, and that no evidence proved enrichment on Veer Investments’ part.
Judge’s ruling
In dismissing the applications for absolution, Judge Ndauendapo held that the defendants had failed to substantiate their special pleas of prescription or to disprove the plaintiff’s prima facie case.
“The failure to adduce evidence to support the special pleas of prescription rendered the pleas meritless,” the judge said.
He ruled that sufficient evidence existed upon which a reasonable court could find in favour of the plaintiff, and ordered the defendants to pay costs, including those of two legal practitioners.
The matter was postponed to 17 October 2025 for a status hearing, when the defence is expected to open its case.
This after the High Court last week dismissed applications by Moshana at the companies which sought absolution from the instance in the embezzlement matter.
The ruling, delivered by Judge Nate Ndauendapo, means the defendants must now answer to allegations that they siphoned the millions.
August 26 Textiles – a subsidiary of August 26 Holdings under the ministry of defence – claims that Moshana, while serving as finance, human resources and administration manager, authorised and processed payments to Veer Investments (Pty) Ltd, Vuma Investments CC, and Proficient Investments CC, all allegedly linked to him, for services that were never rendered.
Plaintiff’s testimony
Testifying for the plaintiff, managing director Silas Chicken Amunyela said that when he joined the company on 1 June 2017, he immediately noticed discrepancies in procurement and financial reporting.
He told the court that the company had three departments, each headed by a manager — with Moshana in charge of finance, HR and administration. When Amunyela requested departmental reports, Moshana failed to submit his.
By September 2017, during a management meeting, it became clear that proper procurement procedures were being ignored. Amunyela instituted a policy requiring at least three quotations for any purchase — a move that exposed several irregularities.
In July 2018, a warehouse supervisor presented him with a N$670 000 invoice from Proficient Investments for repairs to a genset. Suspicious of the amount, Amunyela sourced a comparative quote from Pupkewitz MegaTech, which priced the same work at only N$11 651.
His own review of the company’s bank statements revealed that large payments had been made to three entities: Veer Investments (N$3.4 million), Vuma Investments (N$2.8 million), and Proficient Investments (N$1.2 million). All transactions, he testified, were processed by Moshana and approved under questionable circumstances.
“There was no contract between August 26 Textiles and these suppliers,” he told the court, adding that some payments occurred before his appointment. He reported his findings to August 26 Holdings CEO, Colonel (Ret) George Kaxuxuena, who directed him to open a criminal case.
A forensic investigation by PricewaterhouseCoopers (PwC) confirmed the misappropriation of funds, concluding that payments were made to suppliers who never provided services. The audit revealed 713 supplier transactions worth over N$19.6 million that could not be traced or verified in the company’s system.
PwC’s team leader, Hans Friedrich Hashagen, testified that the finance manager bore responsibility for ensuring accountability for all transactions. He said some invoices were paid twice, others before their issue date, and many had no proof of payment or quotations attached.
Hashagen further revealed that Moshana had undisclosed business interests with companies trading with August 26 Textiles, including Veer Investments.
Another witness, Beverly Kaposiao, who served as general manager for production, testified that she was unaware of certain invoices issued to the company by Veer Investments. One invoice, dated 5 May 2016, charged N$220 000 for embroidery and T-shirt printing — services which, she said, were performed in-house and did not need outsourcing.
Defence arguments
Moshana and his co-defendants, through their lawyers, denied wrongdoing and argued that the claims had prescribed in terms of the Prescription Act.
Moshana’s lawyers argued that there was no direct evidence linking his client to the alleged unlawful payments, adding that the forensic report relied on hearsay and covered a period before Moshana’s employment began in 2011.
They also maintained that the applicants in the matter failed to prove that Moshana violated internal procedures or personally benefitted from any payments.
On behalf of the second defendant, Veer Investments, lawyer Profysen Muluti insisted that the company provided legitimate goods and services, and that the plaintiff’s claims for payments made between 2015 and 2017 had already prescribed.
Muluti cited Kapuka v Haufiku and Uitenhage Municipality v Molloy, arguing that August 26 Textiles should have identified irregular payments during its routine audits. He further claimed that only three payments made during Amunyela’s tenure — totalling N$701 109 — fell within the claim period, and that no evidence proved enrichment on Veer Investments’ part.
Judge’s ruling
In dismissing the applications for absolution, Judge Ndauendapo held that the defendants had failed to substantiate their special pleas of prescription or to disprove the plaintiff’s prima facie case.
“The failure to adduce evidence to support the special pleas of prescription rendered the pleas meritless,” the judge said.
He ruled that sufficient evidence existed upon which a reasonable court could find in favour of the plaintiff, and ordered the defendants to pay costs, including those of two legal practitioners.
The matter was postponed to 17 October 2025 for a status hearing, when the defence is expected to open its case.
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