BFF invested Nu 30M in Zimdra, owned by BFF President
BFF: In what is a clear case of conflict of interest, the Bhutan Football Federation has invested Nu 30 million (M) in the Zimdra Food Private Ltd. of which the President of the federation, Ugen Tsechup Dorji is a promotor.
However, the money the federation’s General Secretary, Ugyen Wangchhuk, said was not the fund granted by FIFA but savings that the federation had collected from its different activities. He said that after conducting all the required programmes mandated by FIFA and Asian Football Confederation (AFC), the left over money goes to the savings of the federation. “This money and the funds generated from leasing out our grounds were invested in Zimdra,” he said.
Ugyen Wangchhuk agreed that a case of conflict of interest was clear in the investment, but said that the decision was taken after consulting with the federation’s committee.
According to Ugyen Wangchhuk, Zimdra Food Private Ltd is providing 10 percent dividend on their investment annually. This is one of the highest dividends currently provided by any company in the country. “It is a case of conflict of interest, but tell me which company will give me 10 percent dividend annually on an investment?” he said.
“Fixed deposits gives me only seven to eight percent interest and savings gives me only six percent,” said Ugyen Wangchhuk. “I’ll definitely invest in the company where I would get the maximum interest for my investment.”
A Memorandum of Understanding (MoU) was signed between the federation and the company. Ugyen Wangchhuk said that according to the MoU, 10 percent dividend on the investment is “guaranteed” by the company. “If the company’s profit is higher, the dividend will also increase with respect to the profit they make,” he said. “Even if the company suffers loss, they will still have to give us the 10 percent.”
According to Ugyen Wangchhuk the idea to invest was pushed forward by him looking at the rate of dividend the company was providing. “I pushed it saying that 10 percent is the best deal we could get rather than just leaving the money ideal in the bank,” he said. “The bank provides us some four to five percent of interest which is not worthwhile.”
Ugyen Wangchhuk said annually Nu 3M income is generated from the investment, which is used to pay the salaries of the national players. There are currently 32 players selected as the national players. Of the 32 players, 23 are provided a monthly salary of Nu 10,000 each. The remaining nine players are given Nu 5,000 each.
He said that the federation this time has collected a good amount of money that they would like to invest as well. “If there is any company willing to give us 10 percent of interest, I have no problem taking off the money from Zimdra anytime and invest in that company,” said Ugyen Wangchhuk.
The government, including the finance minister and the Prime Minister is aware of the investment. The Royal Audit Authority, according to the general secretary also expressed their concern on the conflict of interest. “But I had my own reasoning and they didn’t make any issue,” he said.
“The memorandum of understanding still stands and we will continue until we get a better offer of 10 percent or above.”