News / National
Mnangagwa ally caught up in a US$400 000 corrupt upmarket house deal
26 Feb 2023 at 05:41hrs | Views
PUBLIC Service, Labour and Social Welfare minister Paul Mavima is caught up in a US$400 000 corrupt upmarket house deal in Quinnington, Borrowdale, Harare, involving the National Social Security Authority (Nssa) - under his control - and the ministry of Finance, an investigation by The NewsHawks has revealed.
Nssa, constituted and established in terms of the Nssa Act of 1989, is a statutory corporate body tasked by the government to provide social security. It has an investment portfolio of US$1.2 billion in various sectors of the economy.
As a result, it is seen as a cash cow by political and corporate vultures, although pensioners get peanuts. Zanu-PF factions and their leaders always fight to control the fund as it gives them access to cheap finance and business deals for self-aggrandisement, as well as opportunities to build war chests for political battles.
Investigations by The NewsHawks show the property deal was done secretly on behalf of Mavima.
Due process and board approvals to buy the Quinnington house, Stand No. 218 Lot A1, amid fraudulent financial engineering for private benefit by a Nssa executive, were not followed.
The house was valued at US$350 000, but US$400 000 was paid by Nssa, creating room for US$50 000 to go into private pockets. The transaction was executed through Platinum Investment Managers on 3 October 2022.
The issue came to light when Nssa deputy director audit Andrew Nyakonda was tasked by Nssa's acting general manager Charles Shava on 16 February to conduct an investigation into the disposal of the Borrowdale house and the purchase of Kariba Lodge Stand No. 989 Kariba Township for US$244 000.
Although Nssa bought the house, it was not transferred to its books before it was sold to Mavima. The minister initiated the deal as he identified the property and asked Nssa to buy and keep it for him while he awaited disbursement of his US$500 000 housing allowance given to each cabinet minister. Deputy ministers got US$350 000 and MPs US$40 000.
Even the acting general manager, Shava, who is also the director for occupational safety and health, was sidelined on the deal. Shava is now dealing with the transaction and the knives are out for him, with some pushing for his arrest this coming Monday in a desperate bid to pre-empt a disciplinary hearing scheduled for Tuesday next week.
Shava replaced suspended general manager Arthur Manase who was accused of corruption involving a US$750 000 housing loan. It was said Manase got the loan, while he also received a US$2 500 monthly housing allowance.
Mavima tried to remove Shava in January to put his own ally Agnes Masiiwa as acting general manager under the guise of rotation, but Vice-President Constantino Chiwenga, who was acting President at the time, stopped the manoeuvre, saying it violated good corporate governance.
The underhand Borrowdale house deal comes as The NewsHawks also unearthed another fraudulent transaction by Nssa involving a commercial property in Kariba valued at US$220 000. The property was bought for US$215 000 after negotiations, but US$244 000 was paid. This means US$29 000 was siphoned.
The Quinnington house and the Kariba Lodge transactions were driven by Nssa investments and properties director Brian Murewa, first reported by The NewsHawks as having been suspended recently over the two deals.
Fearing arrest, Murewa has jumped the border into South Africa. He is however expected to appear before an internal disciplinary committee this coming Tuesday.
The two deals were described by a government source as "having elements of abuse of office, fraud and corruption".
The Zimbabwe Anti-Corruption Commission (Zacc), which has been investigating Nssa, is dealing with this issue.
However, Zacc is accused of letting Nssa officials off the hook, including Manase and Murewa, whom some investigators reportedly helped to skip the border.
Zacc chairperson Loice Matanda Moyo told The NewsHawks her investigators are keen to interview Murewa over the corruption allegations. She said they have been informed he has fled to South Africa.
Zacc and Nssa officials say their own investigations have revealed blatant disregard of good corporate governance practices in the Quinnington house deal.
Nssa policies and procedures require that investment proposals be tabled by management for discussion at the Board Investment Committee (BIC). Then the BIC deliberates on the matter before making a recommendation to the board for approval. It is only in exceptional cases that section 18 of the Nssa Act is invoked.
Murewa violated these requirements by acting without following due process and without obtaining the necessary governance approvals.
In the process, Murewa initially directed Prosper Mapika of Platinum Investments Managers to dispose of the property through an email on 10 June 2022. The email was copied to Victor Manyowa, executive assistant to the general manager, and Manase before his suspension. The transaction did not go through then, only for Murewa to resuscitate it and send another email instruction on 3 October 2022 to push it through.
In a bid to cover his tracks, Murewa sent his email straight to Mapika without copying any Nssa staff. Shava was consulted on two occasions, but he did not sanction the transaction as it needed board approval. Murewa then defied Shava and instructed the asset management firm to buy the house.
However, the property was not registered in Nssa's name. The deed of transfer is in the name of Angvo Investments (Private) Limited.
Investigations show the deeds for the property are not in the custody of CBZ Custodial Services, custodians of assets purchased for Nssa by asset managers. This was designed to facilitate easy disposal and transfer of the property to the minister without Nssa's knowledge.
In so doing, Murewa acted outside duties and responsibilities stipulated in his job description and usurped the powers of the general manager and the board. He failed in his fiduciary responsibility of managing day-to-day activities of the investment function in accordance with approved policies, regulations and laws.
On the Kariba real estate deal, investigations show Murewa misrepresented to the Nssa board the true cost of the 2 783-square metre Fishermans Rest Lodge which has six bedrooms, four bathrooms, main with en suite, swimming pool and entertainment area, among other features.
While seeking board approval, Murewa pegged the purchase price at US$240 000, fully aware that the public advert for the property was US$220 000. He made an offer of US$240 000 despite it being valued US$220 000 by the seller, Pam Golding Properties.
The agreement of sale and Pam Golding Properties records show the property was eventually purchased for US$215 000. This means the price was inflated by US$25 000.
But Murewa instructed the asset management firm to pay US$244 000 for the property. This took the prejudice to Nssa to US$29 000.
At some point, Murewa wanted to pay US$252 631.59. Apart from misrepresenting the price to the board, Murewa also inflated it to asset managers, offering US$240 000. He then initiated the transfer of US$300 000 to asset managers. The asset manager acknowledged receipt of the US$300 000 on 13 January 2022.
To eliminate financial trails of the transaction, in violation of Nssa policies and procedures, Murewa withdrew cash on three occasions amounting to US$153 000 (US$30 000; US$23 000 and US$100 000) and made hard cash payments.
By so doing, he exposed public funds to theft and robbery. The US$100 000 was withdrawn and kept overnight before being paid the following day. Of the cash withdrawals, US$29 000 never reached Palm Golding Properties, agents handling the sale, as he only delivered US$124 000 in two batches of US$24 000 and US$100 000.
The agreement of sale was between Thokozani Family Trust, represented by Tendai Muzorewa, and Postproh Investments (Pvt) Limited represented by Mapika. It was signed in retrospect on 11 March 2022, yet all the payments had been made by 31 January 2022.
Mavima could not be reached for comment. The NewsHawks sent him questions via WhatsApp, but he had not responded at the time of going to press.
Nssa, constituted and established in terms of the Nssa Act of 1989, is a statutory corporate body tasked by the government to provide social security. It has an investment portfolio of US$1.2 billion in various sectors of the economy.
As a result, it is seen as a cash cow by political and corporate vultures, although pensioners get peanuts. Zanu-PF factions and their leaders always fight to control the fund as it gives them access to cheap finance and business deals for self-aggrandisement, as well as opportunities to build war chests for political battles.
Investigations by The NewsHawks show the property deal was done secretly on behalf of Mavima.
Due process and board approvals to buy the Quinnington house, Stand No. 218 Lot A1, amid fraudulent financial engineering for private benefit by a Nssa executive, were not followed.
The house was valued at US$350 000, but US$400 000 was paid by Nssa, creating room for US$50 000 to go into private pockets. The transaction was executed through Platinum Investment Managers on 3 October 2022.
The issue came to light when Nssa deputy director audit Andrew Nyakonda was tasked by Nssa's acting general manager Charles Shava on 16 February to conduct an investigation into the disposal of the Borrowdale house and the purchase of Kariba Lodge Stand No. 989 Kariba Township for US$244 000.
Although Nssa bought the house, it was not transferred to its books before it was sold to Mavima. The minister initiated the deal as he identified the property and asked Nssa to buy and keep it for him while he awaited disbursement of his US$500 000 housing allowance given to each cabinet minister. Deputy ministers got US$350 000 and MPs US$40 000.
Even the acting general manager, Shava, who is also the director for occupational safety and health, was sidelined on the deal. Shava is now dealing with the transaction and the knives are out for him, with some pushing for his arrest this coming Monday in a desperate bid to pre-empt a disciplinary hearing scheduled for Tuesday next week.
Shava replaced suspended general manager Arthur Manase who was accused of corruption involving a US$750 000 housing loan. It was said Manase got the loan, while he also received a US$2 500 monthly housing allowance.
Mavima tried to remove Shava in January to put his own ally Agnes Masiiwa as acting general manager under the guise of rotation, but Vice-President Constantino Chiwenga, who was acting President at the time, stopped the manoeuvre, saying it violated good corporate governance.
The underhand Borrowdale house deal comes as The NewsHawks also unearthed another fraudulent transaction by Nssa involving a commercial property in Kariba valued at US$220 000. The property was bought for US$215 000 after negotiations, but US$244 000 was paid. This means US$29 000 was siphoned.
The Quinnington house and the Kariba Lodge transactions were driven by Nssa investments and properties director Brian Murewa, first reported by The NewsHawks as having been suspended recently over the two deals.
Fearing arrest, Murewa has jumped the border into South Africa. He is however expected to appear before an internal disciplinary committee this coming Tuesday.
The two deals were described by a government source as "having elements of abuse of office, fraud and corruption".
The Zimbabwe Anti-Corruption Commission (Zacc), which has been investigating Nssa, is dealing with this issue.
However, Zacc is accused of letting Nssa officials off the hook, including Manase and Murewa, whom some investigators reportedly helped to skip the border.
Zacc and Nssa officials say their own investigations have revealed blatant disregard of good corporate governance practices in the Quinnington house deal.
Nssa policies and procedures require that investment proposals be tabled by management for discussion at the Board Investment Committee (BIC). Then the BIC deliberates on the matter before making a recommendation to the board for approval. It is only in exceptional cases that section 18 of the Nssa Act is invoked.
Murewa violated these requirements by acting without following due process and without obtaining the necessary governance approvals.
In the process, Murewa initially directed Prosper Mapika of Platinum Investments Managers to dispose of the property through an email on 10 June 2022. The email was copied to Victor Manyowa, executive assistant to the general manager, and Manase before his suspension. The transaction did not go through then, only for Murewa to resuscitate it and send another email instruction on 3 October 2022 to push it through.
In a bid to cover his tracks, Murewa sent his email straight to Mapika without copying any Nssa staff. Shava was consulted on two occasions, but he did not sanction the transaction as it needed board approval. Murewa then defied Shava and instructed the asset management firm to buy the house.
However, the property was not registered in Nssa's name. The deed of transfer is in the name of Angvo Investments (Private) Limited.
Investigations show the deeds for the property are not in the custody of CBZ Custodial Services, custodians of assets purchased for Nssa by asset managers. This was designed to facilitate easy disposal and transfer of the property to the minister without Nssa's knowledge.
In so doing, Murewa acted outside duties and responsibilities stipulated in his job description and usurped the powers of the general manager and the board. He failed in his fiduciary responsibility of managing day-to-day activities of the investment function in accordance with approved policies, regulations and laws.
On the Kariba real estate deal, investigations show Murewa misrepresented to the Nssa board the true cost of the 2 783-square metre Fishermans Rest Lodge which has six bedrooms, four bathrooms, main with en suite, swimming pool and entertainment area, among other features.
While seeking board approval, Murewa pegged the purchase price at US$240 000, fully aware that the public advert for the property was US$220 000. He made an offer of US$240 000 despite it being valued US$220 000 by the seller, Pam Golding Properties.
The agreement of sale and Pam Golding Properties records show the property was eventually purchased for US$215 000. This means the price was inflated by US$25 000.
But Murewa instructed the asset management firm to pay US$244 000 for the property. This took the prejudice to Nssa to US$29 000.
At some point, Murewa wanted to pay US$252 631.59. Apart from misrepresenting the price to the board, Murewa also inflated it to asset managers, offering US$240 000. He then initiated the transfer of US$300 000 to asset managers. The asset manager acknowledged receipt of the US$300 000 on 13 January 2022.
To eliminate financial trails of the transaction, in violation of Nssa policies and procedures, Murewa withdrew cash on three occasions amounting to US$153 000 (US$30 000; US$23 000 and US$100 000) and made hard cash payments.
By so doing, he exposed public funds to theft and robbery. The US$100 000 was withdrawn and kept overnight before being paid the following day. Of the cash withdrawals, US$29 000 never reached Palm Golding Properties, agents handling the sale, as he only delivered US$124 000 in two batches of US$24 000 and US$100 000.
The agreement of sale was between Thokozani Family Trust, represented by Tendai Muzorewa, and Postproh Investments (Pvt) Limited represented by Mapika. It was signed in retrospect on 11 March 2022, yet all the payments had been made by 31 January 2022.
Mavima could not be reached for comment. The NewsHawks sent him questions via WhatsApp, but he had not responded at the time of going to press.
Source - The Standard
