Business / Companies
Banks absolve themselves from wrong doing
15 May 2016 at 07:44hrs | Views
BANKS involved in the transfer of cash to offshore accounts did so within the confines of the law and cannot be held liable for illicit financial flows, Bankers Association of Zimbabwe president Dr Charity Jinya has said.
The recent publication of Panama Papers – more than 11,5 million leaked documents detailing financial and attorney client information for more than 214 488 offshore entities – has raised fears that some companies could be siphoning millions from developing countries, Zimbabwe included.
Investigations into some local companies caught up in the revelations are underway. "Just like the RBZ Governor noted, some money was sent out of the country via bank transactions, while, in some instances, people crossed borders with bags of money. But, as of now, banks transactions were done within legal jurisdiction; as of now, we have not yet received reports of any illegal activities by local banks," said Dr Jinya.
RBZ Governor Dr John Mangudya told a Zimbabwe National Chamber of Commerce meeting in the capital last week that liberalisation of the economy in 2009 played a crucial role in facilitating the externalisation of funds – disguised as free funds – from Zimbabwe by individuals and corporates.
The RBZ, which contends that the country has now become a "fishing pond" for the US dollar, opines that not all the transactions involving the transfer of funds out of the country are illegal.
"Not all of the transactions were illegal, but it is a case of morals, for one to take money from a poor economy to a bigger economy. The problem is we over-liberalised the economy in 2009," he said.
Dr Mangudya told The Sunday Mail Business last week that Government was going to look at the nature of the transactions and act accordingly.
ZNCC believes that fighting externalisation should necessarily involve the public and private sector.
According to Global Financial Integrity, a Washington-based research and advisory non-profit organisation, Africa loses close to US$50 billion annually in illicit financial flows. RBZ statistics show that last year an estimated US$1,8 billion was siphoned out of Zimbabwe through illicit transactions, and inflated management and consultancy fees to foreign entities.
The recent publication of Panama Papers – more than 11,5 million leaked documents detailing financial and attorney client information for more than 214 488 offshore entities – has raised fears that some companies could be siphoning millions from developing countries, Zimbabwe included.
Investigations into some local companies caught up in the revelations are underway. "Just like the RBZ Governor noted, some money was sent out of the country via bank transactions, while, in some instances, people crossed borders with bags of money. But, as of now, banks transactions were done within legal jurisdiction; as of now, we have not yet received reports of any illegal activities by local banks," said Dr Jinya.
RBZ Governor Dr John Mangudya told a Zimbabwe National Chamber of Commerce meeting in the capital last week that liberalisation of the economy in 2009 played a crucial role in facilitating the externalisation of funds – disguised as free funds – from Zimbabwe by individuals and corporates.
The RBZ, which contends that the country has now become a "fishing pond" for the US dollar, opines that not all the transactions involving the transfer of funds out of the country are illegal.
"Not all of the transactions were illegal, but it is a case of morals, for one to take money from a poor economy to a bigger economy. The problem is we over-liberalised the economy in 2009," he said.
Dr Mangudya told The Sunday Mail Business last week that Government was going to look at the nature of the transactions and act accordingly.
ZNCC believes that fighting externalisation should necessarily involve the public and private sector.
According to Global Financial Integrity, a Washington-based research and advisory non-profit organisation, Africa loses close to US$50 billion annually in illicit financial flows. RBZ statistics show that last year an estimated US$1,8 billion was siphoned out of Zimbabwe through illicit transactions, and inflated management and consultancy fees to foreign entities.
Source - sundaymail
