News / National
Matinyarare's property worth over ZW$100m forfeited
24 Sep 2023 at 09:41hrs | Views
FORMER Croco Motors boss Joseph Matinyarare's properties have been forfeited to the state after a court established that he acquired them using the proceeds of crime between 2016 and 2020. The exchange rate in 2016 was US$1:ZW$1 but it depreciated over time.
This was after Prosecutor-General (PG) Nelson Mutsonziwa filed an application for an order for civil forfeiture of property made in terms of the Money Laundering and Proceeds of Crime Act. The property consists of two immovable and three motor vehicles.
The application for an order for the civil forfeiture of his house in Southlea Park suburb was however dismissed.
According to court documents, Matinyarare was a parts manager at Croco Holdings (Pvt) Ltd's Graniteside branch, Harare.
The PG said Matinyarare engaged in conduct constituting or associated with serious criminal offences and, using the money obtained from such conduct, bought the property targeted for forfeiture.
The PG submitted that he specifically used money realised from the sale of stolen car parts. Matinyarare is already appearing before the magistrates' court on a charge of fraud.
It is alleged that he collected spare car parts from Croco Motors' group procurement depart[1]ment using a manual goods out note between September 2019 and September 2020 and, instead of entering the parts into the Croco Motors Graniteside stock, converted the same to his own use.
The allegations are that the stock is valued at US$306 851.80. It also is common cause that Matinyarare is again appearing before the same court on a charge of theft.
Allegations are that he stole motor vehicle spare parts belonging to his employer, between 1 January 2016 and September 2020. The value of the spare parts is given as ZW$103 656 448.03 of which ZW$8 850 605.05 worth of spare car parts is said to have been recovered. High Court judge Benjamin Chikowero said he was also convinced that Matinyarare had used the proceeds of crime to buy his properties.
"Despite his protestations, I am satisfied, on a balance of probabilities, that while employed as Croco Motors' parts manager Graniteside, Matinyarare, during the period in question, was involved in some kind of conduct constituting or associated with the theft of ZW$103 761 568.89 worth of motor vehicle spare parts belonging to his employer of which ZW$ 8 850 605 05 worth was recovered from him.
"I have seen the Forensic Audit Report prepared by Caleb Mutsumba, the external auditor. He lays out the basis for his factual findings.
"He explains why he concluded that it was Matinyarare who manipulated Croco Motors' system to facilitate the theft of the motor vehicle spare parts (stock) in question," said the judge.
The manipulation took the form of irregular "adjustments" of the stock in the system followed by the physical removal of such, hence the theft. The four factual findings made by the auditor were that there were deliberate "adjustments" of stock by Matinyarare as the identified "user" in the dealership system used by Croco Motors at the material time.
There were no business, professional, or occupational reasons for those adjustments. The adjustments of the stock were unauthorised and had the effect of writing off stock from the system.
No reasons were given on the more than 1 000 occasions that the stock was written off. The correspondence between physical stock and stock records indicated that what was removed from the system was correspondingly re[1]moved from the physical stock.
The calculations by the auditor established that Matinyarare caused Croco Motors a financial prejudice of ZW$103 761 568.89 as at 30 October 2020. This amount represents the value of the stolen stock.
Ruled the judge: "It is ordered that, the Toyo[1]ta RAV 4X T4 Registration Number AA JOSTE, the Ford Registration number AFC 8278 and the IVECO Lorry 75E15 Flatbed Registration number AEX9419 be and are forfeited to the State.
"Matinyarare shall within the next forty-eight hours do complete and sign all such papers and documents to transfer ownership of the property mentioned in paragraph 1 of this order to which the Sheriff of Zimbabwe, his deputy or assistant shall do so.
"The third respondent (Registrar of motor vehicles) shall upon being called upon by the PG do all things and sign and complete all papers and documents necessary to register ownership of the property mentioned in paragraph 1 (Rav4 and Iveco) of this order in favour of the State.
"The undivided 2.3250% share being share number 6 in a certain piece of land situate in the district of Salisbury called Stand 2494 Arlington Township measuring 3.0772 hectares held under Certificate of Consolidated Title Number 3111/2017 dated 20 August 2017 be and is forfeited to the State.
"The first respondent (registrar of deeds) shall within the next forty-eight hours do all such things and sign and complete all papers and documents necessary to transfer title of the stand in favour of the State failing which the Sheriff of Zimbabwe, his deputy or assistant shall do so.
"The registrar of deeds shall upon being called upon by the PG do all such things and complete and sign all papers and documents necessary to transfer title the house in favour of the State," ruled the judge.
Matinyarare denied effecting any irregular adjustments of stock in Croco Motors system. But the judge said this was a bare denial because it was not backed up by expert testimony to contradict what was submitted by the PG through the external auditor. Matinyarare claimed that the adjustment option was inactive, and could only be made with the participation of the Croco Motors information technology department. The judge however trashed his argument.
"Considering the period that stock was adjusted, that this was done on more than one thousand occasions and the absence of any evidence that the first respondent reported to Croco Motors information technology department that the adjustment option was inactive, and that it therefore needed to be attended to, I do not accept that the adjustment option in the system was inactive, at all.
"That the system could only be activated with the participation of Croco Motors information technology department suggests that it was staff from that department, working with the user of the system, who made the stock adjustments in question.
"This suggests also that Matinyarare, even though he was both Croco Motors Graniteside parts manager and user of the system, was all the while ignorant of the stock adjustments. This is improbable.
"The question that would arise is what then was he managing, if he, a user of the system, had no control over the movement of the stock both in the system and the physical stock itself."
Matinyarare did not dispute that the police, in the company of Croco Motors Graniteside employees, recovered motor vehicles spare parts worth US$8 850 605.05 from his house in Southlea Park. He insisted that the spare parts, recovered from him, belong to him. However, the court established that the parts belong to Croco Motors, having been identified through the special dealer code belonging to the company by its employees, hence the recovery of the same and the corresponding arrest of Matinyarare.
"I think it illogical that the police would countenance a situation where Croco Motors' employees would identify the more than 400 recovered car parts through the Croco Motors dealer code if such code did not appear on those parts.
"I think it even more improbable that the police would effect a recovery in those circumstances.
"I am fortified in this regard by the fact that despite claiming that he purchased what was taken away from him from other suppliers because he was also involved in the business of buying and selling car parts, Matinyarare neither named those suppliers nor presented documentary evidence of him having purchased those items.
"The recovery of the spare parts from his house corroborates the findings of the external auditor that the user of Croco Motors system, Matinyarare, irregularly adjusted stock in the system and stole such stock.
"The foregoing simply means that Matinyarare, his spouse and the fourth respondent (Enerst Mukumba) are all not being truthful in saying, in another breath, that Matinyarare sold the Southlea Park property to Mukumba on 7 December 2020.
"Any other conclusion would defy common sense and logic," said the judge.
With regards to his Arlington house, court papers show that as at 17 February 2021 Matinyarare had fully paid the purchase price, in the sum of US$677 430, inclusive of value-added tax in the sum of US$88 360-44. He however conceded that his salary as Croco Motors parts manager was insufficient to fund the purchase of this property.
Matinyarare's defence was that sometime in 2019 he obtained an interest-free loan of US$20 000 from Kefas Aleck Manda. He used the loan to pay the purchase price of the property under discussion. Manda is his brother.
Manda's affidavits were placed before the judge but there was no evidence to support that this happened.
Mukumba, who was joined to these proceedings on 8 March 2023, said he purchased Matinyarare's Southlea Park house on 7 December 2020 for US$72 000.
Matinyarare said he used the balance of US$52 000 (after repaying the US$20 000 loan) to develop the Arlington property.
"There is overwhelming evidence that the Arlington property is proceeds of crime. I do not accept that Manda lent US$20 000 to the first respondent. It follows that I reject Matinyarare averments that he used the US$20 000 loan to pay the purchase price for the Arlington Property," said the judge.
The judge said this means that Matinyarare did not receive the averred loan, did not use the non-existent loan to pay the purchase price for the Arlington property, and did not refund that loan, as there was no loan to talk about in the first place.
"The first respondent has thus failed to disclose and explain the source of funds used by him to acquire and develop the Arlington property.
"I attribute his failure to knowledge on his part that the funding was illicit. The Arlington property, being proceeds of crime, will be forfeited to the state," ruled the judge.
The open market value of the property was put at US$115 000.
This was after Prosecutor-General (PG) Nelson Mutsonziwa filed an application for an order for civil forfeiture of property made in terms of the Money Laundering and Proceeds of Crime Act. The property consists of two immovable and three motor vehicles.
The application for an order for the civil forfeiture of his house in Southlea Park suburb was however dismissed.
According to court documents, Matinyarare was a parts manager at Croco Holdings (Pvt) Ltd's Graniteside branch, Harare.
The PG said Matinyarare engaged in conduct constituting or associated with serious criminal offences and, using the money obtained from such conduct, bought the property targeted for forfeiture.
The PG submitted that he specifically used money realised from the sale of stolen car parts. Matinyarare is already appearing before the magistrates' court on a charge of fraud.
It is alleged that he collected spare car parts from Croco Motors' group procurement depart[1]ment using a manual goods out note between September 2019 and September 2020 and, instead of entering the parts into the Croco Motors Graniteside stock, converted the same to his own use.
The allegations are that the stock is valued at US$306 851.80. It also is common cause that Matinyarare is again appearing before the same court on a charge of theft.
Allegations are that he stole motor vehicle spare parts belonging to his employer, between 1 January 2016 and September 2020. The value of the spare parts is given as ZW$103 656 448.03 of which ZW$8 850 605.05 worth of spare car parts is said to have been recovered. High Court judge Benjamin Chikowero said he was also convinced that Matinyarare had used the proceeds of crime to buy his properties.
"Despite his protestations, I am satisfied, on a balance of probabilities, that while employed as Croco Motors' parts manager Graniteside, Matinyarare, during the period in question, was involved in some kind of conduct constituting or associated with the theft of ZW$103 761 568.89 worth of motor vehicle spare parts belonging to his employer of which ZW$ 8 850 605 05 worth was recovered from him.
"I have seen the Forensic Audit Report prepared by Caleb Mutsumba, the external auditor. He lays out the basis for his factual findings.
"He explains why he concluded that it was Matinyarare who manipulated Croco Motors' system to facilitate the theft of the motor vehicle spare parts (stock) in question," said the judge.
The manipulation took the form of irregular "adjustments" of the stock in the system followed by the physical removal of such, hence the theft. The four factual findings made by the auditor were that there were deliberate "adjustments" of stock by Matinyarare as the identified "user" in the dealership system used by Croco Motors at the material time.
There were no business, professional, or occupational reasons for those adjustments. The adjustments of the stock were unauthorised and had the effect of writing off stock from the system.
No reasons were given on the more than 1 000 occasions that the stock was written off. The correspondence between physical stock and stock records indicated that what was removed from the system was correspondingly re[1]moved from the physical stock.
The calculations by the auditor established that Matinyarare caused Croco Motors a financial prejudice of ZW$103 761 568.89 as at 30 October 2020. This amount represents the value of the stolen stock.
Ruled the judge: "It is ordered that, the Toyo[1]ta RAV 4X T4 Registration Number AA JOSTE, the Ford Registration number AFC 8278 and the IVECO Lorry 75E15 Flatbed Registration number AEX9419 be and are forfeited to the State.
"Matinyarare shall within the next forty-eight hours do complete and sign all such papers and documents to transfer ownership of the property mentioned in paragraph 1 of this order to which the Sheriff of Zimbabwe, his deputy or assistant shall do so.
"The third respondent (Registrar of motor vehicles) shall upon being called upon by the PG do all things and sign and complete all papers and documents necessary to register ownership of the property mentioned in paragraph 1 (Rav4 and Iveco) of this order in favour of the State.
"The undivided 2.3250% share being share number 6 in a certain piece of land situate in the district of Salisbury called Stand 2494 Arlington Township measuring 3.0772 hectares held under Certificate of Consolidated Title Number 3111/2017 dated 20 August 2017 be and is forfeited to the State.
"The first respondent (registrar of deeds) shall within the next forty-eight hours do all such things and sign and complete all papers and documents necessary to transfer title of the stand in favour of the State failing which the Sheriff of Zimbabwe, his deputy or assistant shall do so.
"The registrar of deeds shall upon being called upon by the PG do all such things and complete and sign all papers and documents necessary to transfer title the house in favour of the State," ruled the judge.
Matinyarare denied effecting any irregular adjustments of stock in Croco Motors system. But the judge said this was a bare denial because it was not backed up by expert testimony to contradict what was submitted by the PG through the external auditor. Matinyarare claimed that the adjustment option was inactive, and could only be made with the participation of the Croco Motors information technology department. The judge however trashed his argument.
"Considering the period that stock was adjusted, that this was done on more than one thousand occasions and the absence of any evidence that the first respondent reported to Croco Motors information technology department that the adjustment option was inactive, and that it therefore needed to be attended to, I do not accept that the adjustment option in the system was inactive, at all.
"That the system could only be activated with the participation of Croco Motors information technology department suggests that it was staff from that department, working with the user of the system, who made the stock adjustments in question.
"This suggests also that Matinyarare, even though he was both Croco Motors Graniteside parts manager and user of the system, was all the while ignorant of the stock adjustments. This is improbable.
"The question that would arise is what then was he managing, if he, a user of the system, had no control over the movement of the stock both in the system and the physical stock itself."
Matinyarare did not dispute that the police, in the company of Croco Motors Graniteside employees, recovered motor vehicles spare parts worth US$8 850 605.05 from his house in Southlea Park. He insisted that the spare parts, recovered from him, belong to him. However, the court established that the parts belong to Croco Motors, having been identified through the special dealer code belonging to the company by its employees, hence the recovery of the same and the corresponding arrest of Matinyarare.
"I think it illogical that the police would countenance a situation where Croco Motors' employees would identify the more than 400 recovered car parts through the Croco Motors dealer code if such code did not appear on those parts.
"I think it even more improbable that the police would effect a recovery in those circumstances.
"I am fortified in this regard by the fact that despite claiming that he purchased what was taken away from him from other suppliers because he was also involved in the business of buying and selling car parts, Matinyarare neither named those suppliers nor presented documentary evidence of him having purchased those items.
"The recovery of the spare parts from his house corroborates the findings of the external auditor that the user of Croco Motors system, Matinyarare, irregularly adjusted stock in the system and stole such stock.
"The foregoing simply means that Matinyarare, his spouse and the fourth respondent (Enerst Mukumba) are all not being truthful in saying, in another breath, that Matinyarare sold the Southlea Park property to Mukumba on 7 December 2020.
"Any other conclusion would defy common sense and logic," said the judge.
With regards to his Arlington house, court papers show that as at 17 February 2021 Matinyarare had fully paid the purchase price, in the sum of US$677 430, inclusive of value-added tax in the sum of US$88 360-44. He however conceded that his salary as Croco Motors parts manager was insufficient to fund the purchase of this property.
Matinyarare's defence was that sometime in 2019 he obtained an interest-free loan of US$20 000 from Kefas Aleck Manda. He used the loan to pay the purchase price of the property under discussion. Manda is his brother.
Manda's affidavits were placed before the judge but there was no evidence to support that this happened.
Mukumba, who was joined to these proceedings on 8 March 2023, said he purchased Matinyarare's Southlea Park house on 7 December 2020 for US$72 000.
Matinyarare said he used the balance of US$52 000 (after repaying the US$20 000 loan) to develop the Arlington property.
"There is overwhelming evidence that the Arlington property is proceeds of crime. I do not accept that Manda lent US$20 000 to the first respondent. It follows that I reject Matinyarare averments that he used the US$20 000 loan to pay the purchase price for the Arlington Property," said the judge.
The judge said this means that Matinyarare did not receive the averred loan, did not use the non-existent loan to pay the purchase price for the Arlington property, and did not refund that loan, as there was no loan to talk about in the first place.
"The first respondent has thus failed to disclose and explain the source of funds used by him to acquire and develop the Arlington property.
"I attribute his failure to knowledge on his part that the funding was illicit. The Arlington property, being proceeds of crime, will be forfeited to the state," ruled the judge.
The open market value of the property was put at US$115 000.
Source - newshawks
