ED’s name & shame ‘looters’ list backfires

President Emmerson Mnangagwa’s decision to name and shame companies alleged to have externalised funds and assets has turned into a nightmare for local companies that are being snubbed by potential suitors and trading partners.

ED warns NGO’s to stay out of politics

This came out during a breakfast meeting organised by the Zimbabwe National Chamber of Commerce (ZNCC) yesterday, where representatives of a number of companies said they have been struggling to do business ever since the list was published by the Office of the President and Cabinet (OPC).

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On March 19, the OPC released a long list of companies purported to have illegally taken money and assets outside the country.

Initially, Mnangagwa had given the culprits a 90-day window period within which they were to return the loot in exchange for their freedom.

The period stretched from December 1, 2017 to February 28, 2018.

After the expiry of the three-month moratorium, he further extended the deadline by another two weeks, to February 19. During that period, government neither asked questions nor preferred charges against those that repatriated the money or assets.

This included cases that were before the courts where judgments were yet to be passed.

A few individuals and companies came forward, but many opted to play hide-and-seek with the authorities.

On Monday last week, Mnangagwa lived up to his word by naming and shaming the alleged culprits who could not take advantage of his moratorium.

Government has said it would subsequently use legal instruments to those that have failed to comply, including triggering prosecutions.

The list, however, emerged as scandalous as it turned out that most of the companies appearing on it were actually legitimate importers and exporters whose transactions were not processed on time and were thus erroneously criminalised.

This has had the effect of compromising their standing since most foreign partners are reluctant to do business with firms that have criminal records.

ZNCC president Divine Ndlhukula said several member organisations are desperately trying to engage the Reserve Bank of Zimbabwe (RBZ) to clear their names and salvage their reputations.

“Their partners abroad are now a bit jittery and obviously that is affecting them. I think there is need for the list to be revised so that only people that externalised are the ones that would appear on it,” she said.

“Currently, there are a lot of people that are on the list who never externalised. It’s important that those companies are cleared because that affects their brands and their business and it’s important that something be done about it,” she said.

Ndlhukula advised the affected companies against suing government for wrongfully exposing them.

“I don’t think going the legal route is the best way. I think the powers-that-be, whoever and wherever that list was generated from; they should revise that list and say these were stated wrongly so that those people can go back to their partners and say we have been cleared.

“If it is the RBZ, obviously they have got to revise that list. I’m sure by now they have had over a 100 engagements by a number of people who feel that they were put on that list when they do not belong to that list. So they should really correct that,” she added.

Jeffrey Rugare, a local businessman who runs an alternative energy solutions concern, narrated how his business partners in Zambia spurned him after his company — Global Solar Company — was wrongly put on the list.

He said the RBZ mistook his $50 000 deal to import solar power equipment for externalised funds, adding that Global Solar Company was wrongly put on the list because of a malfunctioning Zimbabwe Revenue Authority (Zimra) system, which missed its acquittals.

This was during the time when Zimra was processing transactions manually.

“Government is expecting my company to bring back the money when we imported goods which are already circulating on the market. We did not externalise, we are Zimbabweans. We have created employment in the country. We are the first company owned by young Zimbabweans to start manufacturing energy bulbs in the country and we are appearing on the list.

“So if they criminalise us, who is going to do business (with us)? We instead attracted money into the country from our foreign investors who made this business possible. We have a lot of questions to ask. I believe somebody lied to the president. We need a cure from that list because it is affecting our brand. For example, we also operate in Zambia and I sent a message to our partner there to say we wanted to come and start manufacturing there. But he said, ‘hope Mnangagwa will not say you externalised’. We are trying to do business for our country and a foreigner writes this.

“This list, people believe it but it’s a fake list. We want to build our country, it’s our home. But if you do this, you are killing us,” he pleaded.

ZNCC members also heaped the blame on local banks saying they were complicit in the production of the “fake list”.

Former ZNCC president Luxon Zembe opined that the list was replete with companies doing their best to stay afloat despite the difficult operating environment in Zimbabwe.

He pointed an accusing finger at the banks for misinforming the OPC.

But Bankers Association of Zimbabwe (Baz) president Charity Jinya refuted the blame saying it lay squarely with the companies that did not clear their transactions on time.

“I don’t believe it because if it’s more than 90 days, there was an opportunity for banks to write to clients asking for transactions to be cleared. This gives the opportunity for the company to say it should be off the list. No one is perfect, mistakes are common, but there is a process where banks communicate with clients and clients communicate with banks formally and on the back of formal communication, information is then passed through to the RBZ because this is the system which is also under the control of the RBZ,” Jinya said.

She also denied allegations that banks breached client confidentiality by divulging information about their clients to third parties, saying government had direct access to such information through the RBZ.

“The entire banking system is connected to the central bank, they know everything and the clients know it too,” she said.

Deputy Finance minister Terrence Mukupe admitted that government had erred and had now started the process of clearing those that were wrongly implicated.

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