Reserve Bank of Zimbabwe swathed in ‘legal’ corruption

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Zimbabwe’s Reserve Bank boss Gideon Gono is struggling to stay out of
trouble. This time the controversial governor is embroiled in shares grab that has left the oldest bank in the country on the verge of collapse.

from our correspondent in Harare

On Friday Gono grabbed shares worth about Z$6.5 quadrillion which the
government-owned Post Office Serving Bank (POSB) held on the stock market. Reliable sources at central bank on Monday revealed that Gono spent the whole of Friday wrestling the shares.

POSB chief executive Admore Kandlela, emerged the victim as he lost $6
quadrillion in Delta Beverages. Sources say Gono was acting on behalf of a powerful politician aligned to Robert Mugabe.

Initially he wanted POSB’s shares in the part South African-owned
blue-chip company Delta, valued at nearly $6 quadrillion and when eyebrows were raised on why he was targeting only Delta, he then demanded the bank’s entire share portfolio.

This includes a strategic 18 percent in CFX Bank Limited, shares in Old Mutual, Hippo Valley, Star Africa and African Sun Limited. “The government says it knows SAB Miller supported (Simba) Makoni and interestingly it is a shareholder in Delta. But it gets interesting because the Delta boss Joe Mtizwa was accused of being on (Morgan) Tsvangirai’s side and being a runner in the botched unity deal between MDC and ZANU-PF,” the RBZ source said.

SAB Miller is a minority shareholder in Delta. But another source said it was Gono who wanted the shares for himself as he continues to build a business empire spanning the media industry, banking, agriculture and petroleum.

“Gono’s argument was that he wants them for strategic purposes,” the RBZ source said. Gono’s deputy Charity Dhliwayo and the divisional chief for Banking Licencing and Supervision, a one Chirozva, acting on behalf of their boss, held a meeting last Wednesday with Kandlela and told him they wanted the whole share portfolio.

Dhliwayo and Chirozva argued that other banks had given up their shares as the Banking Act did not allow them to actively trade on the stock market – deliberately glossing over the fact that the POSB is governed by the POSB Act which does not limit the financial activities which the bank can undertake.

Kandlela told the RBZ duo that the bank would collapse and ignored their
demands. He then wrote a letter seeking advice from the Ministry of Finance. The Ministry told him to stay put.

This infuriated Gono who summoned Kandlela and POSB chairman Tim Chiganze for a meeting in his office on Thursday morning.

It is at that meeting that Gono threatened to fire Kandlela if he did not play ball. “The final message from Gono was that Kandlela should deliver the share certificates on his desk at 11 am on Friday without fail,” the RBZ source said.

But Kandlela in a last ditch effort to stop Gono, approached the Minister of Finance Samuel Mumbengegwi who wrote a letter to Gono saying POSB could not release the shares to him without a substantive reason. The letter was delivered on Friday.

Around 0900 hrs on Friday Gono called Kandlela asking him to bring the share certificates but the POSB chief told him that Mumbengegwi had written to Gono that morning saying the bank could not release the certificates.

Gono hung up and Kandlela heaved a sigh of relief, but not for too long.
“Within two hours the Ministry of Finance told Kandlela to accede to Gono’s demands. It was dramatic and incredible. We were shocked,” said a POSB official, capping a tense week that has left one of the country’s oldest financial institutions on the brink of collapse.

Yesterday Gono was in Mozambique attending an African Development Bank meeting.

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