News / Local
Reserve Bank of Zimbabwe appoints tainted Mpofu
19 May 2024 at 06:54hrs | Views
TRUST, confidence and credibility of the Reserve Bank of Zimbabwe (RBZ) has been put at stake after the new central bank governor John Mushayavanhu appointed tainted banker Morris Bekezela Mpofu as his official adviser.
The development comes at a time the RBZ is grappling to earn the trust of the public following the introduction of the country's new currency, Zimbabwe Gold (ZiG), which is already being resisted by the public.
Mpofu started working at the central bank early this month. His workmates confirmed that he had hit the road running by drawing them into a series of marathon meetings.
However, Mpofu has a tainted past that places the whole of the RBZ's credibility at stake.
In 2019, he was fired as chief executive officer of the Zimbabwe Consolidated Diamond Company (ZCDC) over corruption and abuse of office and subsequently arrested.
The ZCDC board said at the material time they had to relieve seven executives of their duties, including Mpofu, "to rebuild public and market confidence following reports of rampant corruption and abuse of office."
Allegations arose that Mpofu recommended Robal Hussein to be allowed to buy diamonds from the Minerals Marketing Corporation of Zimbabwe (MMCZ), knowing that he was an ex-convict and blacklisted under the Kimberly Process Certification Scheme.
Hussein and Youssef Osseily were arrested on 20 September 2008 in India for smuggling 3 605.73 carats of rough Zimbabwe diamonds valued about US$900 000 in violation of Kimberly Process rules and the Free Trade in Diamonds Act of India. It was alleged that the seized rough, semi-polished diamonds were confiscated by the government of India.
Hussein and Osseily were convicted and sentenced to four years imprisonment on 22 September 2010. They both served their jail terms and were later deported to their respective countries of origin upon release from prison.
The state argued that on 18 September 2018, a meeting was convened between ZDIAM (Private) Limited, represented by its director Hussein, and ZCDC representatives.
On 26 March 2019, Hussein attended a diamond tender at the MMCZ representing a Lebanese company, Diamond Cut. It is alleged that Hussein bought three diamond parcels weighing a total 358.58 carats for US$258 224.66.
The state, when Mpofu appeared before the courts, said Mpofu had no right to recommend Hussein, who had a criminal record relating to smuggling of diamonds blacklisted under the Kimberly Process and was not licenced to buy minerals.
In 2022, Mpofu also courted controversy.
He was disgraced, two days after a Zimbabwe Revenue Authority (Zimra) appointment.
The Zimra board suspended the assumption of his duty as acting Commissioner-General, two days after announcing his appointment.
The development came after public outrage over his appointment following revelations of his past that he was fired the from state-owned ZCDC in 2019 over reports of corruption.
Mpofu had two days earlier been appointed to take over the position of Commissioner-General of Zimra. Rameck Masaire was at the time Acting Commissioner-General of Zimra set to retire effect from 1 February 2022. When Mpofu's appointment was reversed, he then continued to serve as Acting Commissioner-General.
Mpofu however did not face trial after the state withdrew charges. The state led by prosecutor Venerandah Munyoro withdrew the charges before plea and said police would summon Mpofu back to court in the event that they gathered enough evidence for his prosecution. Harare regional magistrate Hosea Mujaya withdrew the matter subsequently.
Speaking to The NewsHawks, economist Professor Gift Mugano said the credibility of the Reserve Bank is at stake when tainted persons come on board to head its monetary affairs. He said as a measured step, the RBZ governor must be ensuring that a currency board is put in place.
"You would note that in countries which had a serious crisis like ourselves, currency crisis, like Bulgaria and of course many others, which include Argentina, they failed to gain the trust and confidence (due to tainted bankers) and they brought in eminent people across the world and also reputable people from their respective countries and then these people were taken as some kind of confidence building.
"I mean, they were taken as guarantors. So in those countries from 1960s to the 1999, early 2000, late 1990s, there was so much trust and confidence which was restored around the institutions.
"And the currency boards succeeded in addressing currency crises. So today we have a new currency called ZIG. And we were expecting that the governor would put in place the currency board because structured currency is normally supposed to be associated with the currency board because you're coming up with a new currency backed by gold," he said.
Mugano pointed out that with tainted people behind him, governor Mushayavanhu will see the Zig currency heading to the graveyard.
"You are taking the exchange of gold and you need to guarantee that the bank is available and they are given to the business when they need them. So a currency board was supposed to be in place. So the governor did not put a currency board. Then if we hear that he's taken somebody who has credibility issues, then he put everything into tatters. And the trust which we badly need will not be attained. And naturally the ZiG will continue to find itself walking towards the graveyard," he said.
Isaac Muzambi, the RBZ public relations and communications officer requested written questions when asked to confirm officially in what capacity Mpofu is serving at RBZ. He did not respond even after several follow ups where he promised to do so.
However, reliable sources told The NewsHawks he has been appointed special advisor to Mushayavanhu, a post that was previously held by banker Munyaradzi Kereke during the reign of Gideon Gono.
The development comes at a time the RBZ is grappling to earn the trust of the public following the introduction of the country's new currency, Zimbabwe Gold (ZiG), which is already being resisted by the public.
Mpofu started working at the central bank early this month. His workmates confirmed that he had hit the road running by drawing them into a series of marathon meetings.
However, Mpofu has a tainted past that places the whole of the RBZ's credibility at stake.
In 2019, he was fired as chief executive officer of the Zimbabwe Consolidated Diamond Company (ZCDC) over corruption and abuse of office and subsequently arrested.
The ZCDC board said at the material time they had to relieve seven executives of their duties, including Mpofu, "to rebuild public and market confidence following reports of rampant corruption and abuse of office."
Allegations arose that Mpofu recommended Robal Hussein to be allowed to buy diamonds from the Minerals Marketing Corporation of Zimbabwe (MMCZ), knowing that he was an ex-convict and blacklisted under the Kimberly Process Certification Scheme.
Hussein and Youssef Osseily were arrested on 20 September 2008 in India for smuggling 3 605.73 carats of rough Zimbabwe diamonds valued about US$900 000 in violation of Kimberly Process rules and the Free Trade in Diamonds Act of India. It was alleged that the seized rough, semi-polished diamonds were confiscated by the government of India.
Hussein and Osseily were convicted and sentenced to four years imprisonment on 22 September 2010. They both served their jail terms and were later deported to their respective countries of origin upon release from prison.
The state argued that on 18 September 2018, a meeting was convened between ZDIAM (Private) Limited, represented by its director Hussein, and ZCDC representatives.
On 26 March 2019, Hussein attended a diamond tender at the MMCZ representing a Lebanese company, Diamond Cut. It is alleged that Hussein bought three diamond parcels weighing a total 358.58 carats for US$258 224.66.
The state, when Mpofu appeared before the courts, said Mpofu had no right to recommend Hussein, who had a criminal record relating to smuggling of diamonds blacklisted under the Kimberly Process and was not licenced to buy minerals.
In 2022, Mpofu also courted controversy.
The Zimra board suspended the assumption of his duty as acting Commissioner-General, two days after announcing his appointment.
The development came after public outrage over his appointment following revelations of his past that he was fired the from state-owned ZCDC in 2019 over reports of corruption.
Mpofu had two days earlier been appointed to take over the position of Commissioner-General of Zimra. Rameck Masaire was at the time Acting Commissioner-General of Zimra set to retire effect from 1 February 2022. When Mpofu's appointment was reversed, he then continued to serve as Acting Commissioner-General.
Mpofu however did not face trial after the state withdrew charges. The state led by prosecutor Venerandah Munyoro withdrew the charges before plea and said police would summon Mpofu back to court in the event that they gathered enough evidence for his prosecution. Harare regional magistrate Hosea Mujaya withdrew the matter subsequently.
Speaking to The NewsHawks, economist Professor Gift Mugano said the credibility of the Reserve Bank is at stake when tainted persons come on board to head its monetary affairs. He said as a measured step, the RBZ governor must be ensuring that a currency board is put in place.
"You would note that in countries which had a serious crisis like ourselves, currency crisis, like Bulgaria and of course many others, which include Argentina, they failed to gain the trust and confidence (due to tainted bankers) and they brought in eminent people across the world and also reputable people from their respective countries and then these people were taken as some kind of confidence building.
"I mean, they were taken as guarantors. So in those countries from 1960s to the 1999, early 2000, late 1990s, there was so much trust and confidence which was restored around the institutions.
"And the currency boards succeeded in addressing currency crises. So today we have a new currency called ZIG. And we were expecting that the governor would put in place the currency board because structured currency is normally supposed to be associated with the currency board because you're coming up with a new currency backed by gold," he said.
Mugano pointed out that with tainted people behind him, governor Mushayavanhu will see the Zig currency heading to the graveyard.
"You are taking the exchange of gold and you need to guarantee that the bank is available and they are given to the business when they need them. So a currency board was supposed to be in place. So the governor did not put a currency board. Then if we hear that he's taken somebody who has credibility issues, then he put everything into tatters. And the trust which we badly need will not be attained. And naturally the ZiG will continue to find itself walking towards the graveyard," he said.
Isaac Muzambi, the RBZ public relations and communications officer requested written questions when asked to confirm officially in what capacity Mpofu is serving at RBZ. He did not respond even after several follow ups where he promised to do so.
However, reliable sources told The NewsHawks he has been appointed special advisor to Mushayavanhu, a post that was previously held by banker Munyaradzi Kereke during the reign of Gideon Gono.
Source - newshawks
