The Central Bank of Lesotho (CBL), custodian of financial stability and guardian of the public’s money, is refusing to answer direct questions about what appear to be blatant violations of the law, pure criminality, by Zenith Horizon Insurance and its controversial subsidiary, Mamoth Health.
Instead of clarifying whether it has approved, investigated, or penalised these arrangements, the Bank has chosen silence. This is fuelling suspicion that crime may be happening in plain sight, under the very institution mandated to stop it.
Section 11(4) of the Financial Institutions Act, 2012, could not be clearer. It states that no unlicensed entity may accept deposits from the public.
“A person, other than a licensed deposit-taking institution, shall not accept any deposits from the public.”
It further warns: “Any person who contravenes the provisions of subsection (4) commits an offence and shall, on conviction, be liable to either or both penalties provided in the First Schedule (10 years imprisonment or M500,000 fine).”
However, Newsday has confirmed that Mamoth Health, which has no CBL licence, continues to collect contributions from members of the public as if it were a financial institution.
Zenith Horizon Insurance, which is licensed by the central bank, is said to own and manage Mamoth. That ownership structure alone raises the spectre of serious illegality, but the CBL will not say whether it has intervened.
Section 28(14) of the same Act prohibits financial institutions from holding shares in another undertaking, except under narrow, explicitly approved circumstances.
The law provides: “A financial institution shall not directly or indirectly, acquire or hold any part of the share capital of any financial, commercial, agricultural, industrial or other undertaking except such share-holdings as a financial institution may acquire in the course of the satisfaction of debts due to it, which share-holdings shall, however, be disposed of at the earliest suitable moment and not later than a date at which such disposition may occur without incurring a loss, as the Commissioner may approve and, in any case, within 2 years of their acquisition at the latest, this period may be extended for a period of up to one year by approval of the Commissioner.”
Despite this, Zenith reportedly owns around 70 percent of Mamoth.
When asked if Zenith had sought and obtained approval from the Commissioner, and if not, why it has not taken enforcement action, the bank did not answer.
The Act does more than prohibit corporate misconduct; it also holds directors and officers personally liable for contraventions, with penalties that could lead to prosecution.
“A person who contravenes the provisions of this section commits an offence and, on conviction, shall be liable to a penalty of either or both penalties provided in the First Schedule (two years imprisonment or M40,000 fine).”
It continues: “Provided that where the person found guilty of such offence is a body corporate, the term of imprisonment set out in the third column of the First Schedule (two years imprisonment) shall apply to any director, officer, or person responsible for carrying out any contravention of such provisions.”
Yet the CBL, when pressed on whether Zenith Horizon’s executives, including its CEO, could face liability, declined to confirm if investigations are even underway.
In response to Newsday’s detailed questions, the CBL issued only this: “The Bank is prohibited by the law from disclosing information relating to the affairs of a regulated entity and is therefore unable to comment further.”
Last week Newsday reported that Zenith Horizon, a regulated insurer under direct CBL supervision, had apparently gone rogue, acquiring a majority stake in Mamoth Insurance/Medical Aid around 2023–2024 and assuming management control.
Instead of rescuing the troubled health insurer, multiple insiders allege Zenith’s involvement hastened Mamoth’s collapse. Staff went unpaid for months, some were forced to resign just to access their pensions, and others faced frozen bank accounts or the threat of losing property.
Allegations also point to conflicts of interest, with Zenith’s ties to another medical aid scheme raising concerns of collusion and the deliberate weakening of competition in Lesotho’s medical aid sector.
Even when the Ministry of Trade sought to intervene, sources say Zenith blocked the move, promising to rescue Mamoth itself, a promise that never materialised.
The company now sits insolvent, employees abandoned, and the public left to wonder whether the regulator was complicit, complacent, or simply asleep.
Summary
- The Central Bank of Lesotho (CBL), custodian of financial stability and guardian of the public’s money, is refusing to answer direct questions about what appear to be blatant violations of the law, pure criminality, by Zenith Horizon Insurance and its controversial subsidiary, Mamoth Health.
- “A financial institution shall not directly or indirectly, acquire or hold any part of the share capital of any financial, commercial, agricultural, industrial or other undertaking except such share-holdings as a financial institution may acquire in the course of the satisfaction of debts due to it, which share-holdings shall, however, be disposed of at the earliest suitable moment and not later than a date at which such disposition may occur without incurring a loss, as the Commissioner may approve and, in any case, within 2 years of their acquisition at the latest, this period may be extended for a period of up to one year by approval of the Commissioner.
- “A person who contravenes the provisions of this section commits an offence and, on conviction, shall be liable to a penalty of either or both penalties provided in the First Schedule (two years imprisonment or M40,000 fine).
Authored by our expert team of writers and editors, with thorough research.
