National Social Security Authority (NSSA) managers awarded themselves between $100 000 and $460 000 in housing, vehicle and personal loans in many cases, without following laid down procedure and there was no subsequent enforcement on repayments, leaving many in arrears.
Checks such as capacity to repay based on monthly salary were ignored. A consultant hired by NSSA to establish how loans were dished out, says they were approved without any “quality control”, with some beneficiaries that had not yet fully paid back earlier loans being given new loans.
Critically, some of the loans were approved without all those responsible for approval signing off on the loans, exposing corporate governance shortcomings.
The consultant says seven managers and eight executives have loans ranging from $100 000 to $460 000. The money was borrowed between January 2017 and December 2018.
NSSA board chairman Dr Cuthbert Chidoori yesterday confirmed that there are traces of irregularity in the parcelling out of loans, and vowed to recover the money.
“We are looking at loans issued in contravention of conditions of service. The NSSA conditions of service specify what loans staff are eligible for and what we have been given in that forensic (audit report) are numbers and figures which clearly, are in violation of those stipulations in the conditions of service,” said Dr Chidoori.
“So our interest is really to fall back and systematically go through whatever it is that has been unveiled and give an opportunity also to interrogate staff.
“And where indeed there is violation, the money has to be paid back. There will be recovery enforcement.
“This will affect even staff that have left NSSA. If they have left NSSA, we will have to institute civil recoveries.”
According to the consultant’s report, two executives who benefited from the loans, former general manager Elizabeth Chitiga and former investments director Chamunorwa Shadreck Vera, have since been fired.
NSSA chief occupational, health and safety and rehabilitation centre officer Dr Betty Nyereyegona, allegedly received a personal loan of $10 000 with a loan interest rate of 6,5 percent on October 1, 2017.
She started making monthly repayments on February 1, 2018, indicating that no payments were made in the first three months from receiving the loan.
Dr Nyereyegona went on to access another loan of $1 000 for home improvement. However, the consultant found that the section that is supposed to be completed by loan officers was not fully signed.
“The application form wasn’t completed by the accounts department and the salaries and loans department. The loan application form contains six sections, but only four sections were completed,” reads the report.
There was potential financial prejudice of US$3 451,84 due to non-repayment of loans.
NSSA group legal and corporate secretarial executive Ms Cynthia Mugwira allegedly received a personal loan of $2 500 on October 1, 2017, with an interest rate of 6,5 percent.
No monthly payments were made for six months from November 1, 2017 to May 1, 2018 towards the initial loan received.
“Mugwira C. T then further received another loan of $2 650 on 1 May 2018 with the same loan interest. This indicates that
there was no close monitoring of loan repayments hence low compliance and a risk of non-payment of loans,” observed the consultant.
In terms of housing loans, it was found out that no proper documentation is “being maintained, first on the qualifications. The policy stipulates that the loan qualification amount shall be as per prevailing building schedules or as directed by the board from time to time”.
However, the consultant couldn’t get documents in support of that. The policy states that money advanced to an applicant should be deposited into the third party account and receipts are to be obtained.
Dr Nyereyegona had a housing loan of $30 000, which was deposited into her personal account but she allegedly didn’t produce receipts.
Chitiga is also alleged to have obtained a housing loan of $300 000 on February 7, 2017.
The application form was not fully approved, with the head of department not signing it. In this instance, NSSA was potentially prejudiced to the tune of US$15 783,93 resulting from no loan repayments.
The consultant said Chitiga had a due housing loan balance of $355 739,72 on April 1, 2018 that attracted a loan interest rate of 5 percent.
For nine months between April 1, 2018 and December 1, 2018, no payments were made.
Emerson Mungwariri is alleged to have applied for a vehicle loan of $75 900 on January 5, 2017, but it was recorded as $90 000 in the executive loan listings.
Other bosses who got vehicle loans but did not honour monthly payments are Chiuta J. T who got $57 000 on September 18, 2017.
Former NSSA general manager Barnabus Matongera had a vehicle loan due of $3 399,36 on December 1, 2017.
The loan attracted an interest rate of 7 percent. According to the report, no payment was made between December 1, 2017 and January 1, 2018.
Ms Mugwira also applied for a vehicle loan with a purchase price of $68 950 but an anomaly was noted as the executive loan list shows an amount of $70 000.
The NSSA system is understood to be so faulty that Chitiga, who borrowed a personal loan of $10 000, had continuous deductions from January 1, 2018 to April 1, 2018, despite having paid the initial loan in full.
Chitiga is now owed $3 337, 61 by NSSA for that loan, although owing on other loans, and the consultant says the beneficiary might have an outstanding loan which was not recorded that she is servicing or the system is misrouting transactions.
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