News / National
$3 million fuel scam claims first scalp
06 Apr 2016 at 06:27hrs | Views
CMED (Pvt) Ltd managing director Davison Mhaka has been arrested on allegations of obstructing the course of justice after he reportedly cooked up papers showing how $2,7 million in the botched fuel deal was spent.
Mhaka was arrested on Monday and appeared before Harare provincial magistrate Mr Vakayi Chikwekwe yesterday facing charges of defeating or obstructing the course of justice and violating the Money Laundering and Proceeds of Crime Act.
He was remanded to April 20 on $500 bail.
As part of his bail conditions, Mhaka was ordered to continue residing as his house in Avondale West in Harare, surrender his passport to the Clerk of Court, report every Monday at CID Serious Frauds and not to interfere with State witnesses.
Mrs Idah Mateke-Maromo prosecuted.
According to the State, sometime in February 2013, CMED, through its fuel division, invited companies to bid for the supply and delivery of diesel amounting to five million litres.
It is alleged that four bidders responded by supplying quotations, among them First Oil Company (Private) Limited, represented by Alex Kudakwashe Mahuni and Alloys Nyamadzawo.
On February 22, 2013, First Oil Company was awarded the tender to supply and deliver the fuel to CMED.
It is alleged that to induce payment, Mahuni gave CMED confirmation letters from Petrotrade and National Oil Company of Zimbabwe that they were holding the commodity on behalf of First Oil Company and that the diesel would be released upon payment to their company.
On March 1, 2013 CMED transferred $2,2 million into First Oil Company's ZB Bank account and six days later, a further $100, 000 was paid to First Oil by CMED.
The State says despite the payment, no diesel was delivered. This resulted in an overall prejudice to CMED of $2,7 million.
Investigations carried out revealed that Mahuni and Maxwell Katunga, being signatories to First Oil Company account, instructed ZB Bank to transfer $2 360 000 from their account to EBG Hong Kong Limited's bank account number OSA 11013768250901 held by Ping AN Bank Co Limited in China.
According to the State, ZB Bank indicated that the two confirmation letters from Petrotrade and National Oil Company of Zimbabwe were inadequate to facilitate the release of the money as it wanted CMED to have title to the fuel before releasing the money.
On March 5, 2013 CMED, represented by Mhaka and Brian Manjengwa, the then parastatal's fuels manager, wrote to ZB Bank instructing them to release the money although they had not secured fuel.
The money was then transferred to China and despite numerous follow- ups no fuel was delivered to CMED.
On July 2, 2013 a fraud case was reported to police by CMED leading to the arrest of Mahuni, Katunga and Nyamadzawo under CR Number 457/07/13 and DR Number 30/07/13.
Investigations were conducted and what remained outstanding was to get a confirmation from EBG Hong Kong Limited Bank in China regarding the movement of the money.
It is alleged that in a bid to defeat the course of justice and to conceal the movement and disposal of the money, Mhaka, working in cahoots with Mahuni and Katunga -who are still at large -approached an IT expert in South Africa through Daniel Chidenyu, a Zimbabwean national based in the neighbouring country.
Mhaka requested through Chidenyu that the IT expert, only identified as Pablo, to concoct company registration documents and bank statements reflecting the disposal of the $2,7 million.
In August 2015, the IT expert allegedly produced a document purporting that several transactions were made and that companies named during the transactions existed.
The document was allegedly handed over to Mhaka after being paid 250 000 rand.
The State further heard that, armed with the said document, whose contents Mhaka knew to be false and malicious, presented it to the National Prosecuting Authority so that they would be exonerated from fraud charges.
It is alleged that sometime in November 2015, Mhaka on realising that their fictitious documents were not conclusive, contacted Chidenyu and instructed him to make closed circuit television footages purportedly showing one Killiana Bangure and Fanuel Kapanje withdrawing the fraudulently acquired funds from the bank.
Chidenyu reportedly turned him down citing that he had not been paid for the previous transaction.
Police carried out investigations into the authenticity of the document through Interpol and it was confirmed that all the accounts and companies mentioned in the document did not exist.
On February 23, Chidenyu came in Zimbabwe where he volunteered the information to the police and a statement was recorded.
In light of the foregoing, the accused person defeated the course of justice, lied before the court and concealed the movement of stolen money, the State heard.
Mhaka was arrested on Monday and appeared before Harare provincial magistrate Mr Vakayi Chikwekwe yesterday facing charges of defeating or obstructing the course of justice and violating the Money Laundering and Proceeds of Crime Act.
He was remanded to April 20 on $500 bail.
As part of his bail conditions, Mhaka was ordered to continue residing as his house in Avondale West in Harare, surrender his passport to the Clerk of Court, report every Monday at CID Serious Frauds and not to interfere with State witnesses.
Mrs Idah Mateke-Maromo prosecuted.
According to the State, sometime in February 2013, CMED, through its fuel division, invited companies to bid for the supply and delivery of diesel amounting to five million litres.
It is alleged that four bidders responded by supplying quotations, among them First Oil Company (Private) Limited, represented by Alex Kudakwashe Mahuni and Alloys Nyamadzawo.
On February 22, 2013, First Oil Company was awarded the tender to supply and deliver the fuel to CMED.
It is alleged that to induce payment, Mahuni gave CMED confirmation letters from Petrotrade and National Oil Company of Zimbabwe that they were holding the commodity on behalf of First Oil Company and that the diesel would be released upon payment to their company.
On March 1, 2013 CMED transferred $2,2 million into First Oil Company's ZB Bank account and six days later, a further $100, 000 was paid to First Oil by CMED.
The State says despite the payment, no diesel was delivered. This resulted in an overall prejudice to CMED of $2,7 million.
Investigations carried out revealed that Mahuni and Maxwell Katunga, being signatories to First Oil Company account, instructed ZB Bank to transfer $2 360 000 from their account to EBG Hong Kong Limited's bank account number OSA 11013768250901 held by Ping AN Bank Co Limited in China.
According to the State, ZB Bank indicated that the two confirmation letters from Petrotrade and National Oil Company of Zimbabwe were inadequate to facilitate the release of the money as it wanted CMED to have title to the fuel before releasing the money.
The money was then transferred to China and despite numerous follow- ups no fuel was delivered to CMED.
On July 2, 2013 a fraud case was reported to police by CMED leading to the arrest of Mahuni, Katunga and Nyamadzawo under CR Number 457/07/13 and DR Number 30/07/13.
Investigations were conducted and what remained outstanding was to get a confirmation from EBG Hong Kong Limited Bank in China regarding the movement of the money.
It is alleged that in a bid to defeat the course of justice and to conceal the movement and disposal of the money, Mhaka, working in cahoots with Mahuni and Katunga -who are still at large -approached an IT expert in South Africa through Daniel Chidenyu, a Zimbabwean national based in the neighbouring country.
Mhaka requested through Chidenyu that the IT expert, only identified as Pablo, to concoct company registration documents and bank statements reflecting the disposal of the $2,7 million.
In August 2015, the IT expert allegedly produced a document purporting that several transactions were made and that companies named during the transactions existed.
The document was allegedly handed over to Mhaka after being paid 250 000 rand.
The State further heard that, armed with the said document, whose contents Mhaka knew to be false and malicious, presented it to the National Prosecuting Authority so that they would be exonerated from fraud charges.
It is alleged that sometime in November 2015, Mhaka on realising that their fictitious documents were not conclusive, contacted Chidenyu and instructed him to make closed circuit television footages purportedly showing one Killiana Bangure and Fanuel Kapanje withdrawing the fraudulently acquired funds from the bank.
Chidenyu reportedly turned him down citing that he had not been paid for the previous transaction.
Police carried out investigations into the authenticity of the document through Interpol and it was confirmed that all the accounts and companies mentioned in the document did not exist.
On February 23, Chidenyu came in Zimbabwe where he volunteered the information to the police and a statement was recorded.
In light of the foregoing, the accused person defeated the course of justice, lied before the court and concealed the movement of stolen money, the State heard.
Source - the herald
