Gilbert Muponda is an exiled Zimbabwean businessman who is taking on the might of international money transfer giant MoneyGram, after he challenged them to review their relationship with a financial institution that he says ‘stole’ his bank.

Muponda was forced to flee the country at the height of a controversial crackdown on the financial sector in 2004. Century Bank, which he owned via his ENG Capital investment company, was illegally seized by the government he says. Six years on the struggling bank was rebranded to CFX Bank and later bought by Interfin Bank. Its CEO, Farai Rwodzi, is reported to be a proxy for retired army general Solomon Mujuru.

‘Interfin is now liable to my claim due to their attempt to cover up the ownership dispute by rebranding and changing CFX Bank operations. This is clear money and transaction laundering being executed,’ a fuming Muponda told SW Radio Africa. MoneyGram International has been sucked into the dispute because they have a business relationship with Interfin.

‘I feel MoneyGram as a leading international brand should not be doing business with Interfin because they are holding onto an asset that was looted from me. So what we have asked MoneyGram to do is carry out a proper diligence check and ensure that they are doing business with reputable people,’ he told us.

In November 2009 Muponda successfully used an internet campaign to block a major financial institution from buying the disputed bank. One of the world’s biggest banks, Credit Suisse through the Finance Bank of Zambia, had sought to buy CFX Bank. Muponda however used an aggressive internet campaign dubbed ‘Return Muponda’s Bank’ and Credit Suisse eventually pulled out of the deal.

On the 25th August this year the Newsday newspaper covered a story that quoted Interfin chairman Farai Rwodzi claiming they had paid Muponda US$5,3 million in compensation for his shares in CFX Bank. A furious Muponda denied this and said; ‘Rwodzi and Interfin Bank Zimbabwe are trying to mislead their international business partners such as MoneyGram International and DSTV who are obviously concerned by the on-going CFX Bank/Interfin ownership dispute.’

On Wednesday SW Radio Africa spoke to Linda Michielutti, the company spokesperson for MoneyGram International. She told us ‘MoneyGram International has an extremely strong commitment to and investment in anti money-laundering compliance. We are fully compliant with all local and international requirements for Money Services Businesses. We are currently investigating Mr. Muponda’s claims.’

A determined Muponda meanwhile has designed more website banners, this time targeting MoneyGram and he has sent them to the company head office for them to see. ‘We will look at this and revert to you,’ was all MoneyGram lawyer Bessima Bahri wrote in response.

SW Radio Africa news – The Independent Voice of Zimbabwe

An informed source confirmed that the Farai Rwodzi-Mujuru-Interfin Bank Zimbabwe syndicate sneaked into the Kingdom Meikles Africa demerger saga by offering John Moxon political protection in exchange for partial control of Meikles Africa.

The Rwodzi-Mujuru-Interfin Bank Zimbabwe controlled board requisitioned for an EGM on October 4, to ask for shareholder consent to implement the demerger processing which they are preparing to kick out Kingdom Meikles founder Nigel Chanakira and merge Kingdom Bank with Interfin Bank which also include the controversially acquired CFX Bank which was seized from Gilbert Muponda of ENG Capital.

According to a report in the Herald Business in the event that an offer acceptable to the board is received prior to the date of the EGM shareholders would be notified and asked to vote.

The Rwodzi-Mujuru-Interfin Bank Zimbabwe however does not expect Chanakira to come up with the money ,this has forced Chanakira to rope in President Mugabe to come in a declare that Kingdom will not be allowed to be taken over by Meikles as this is against the”country’s indeginization rules and regulations”

Interfin Bank Chairman who is also Kingdom Meikles Africa Chairman, Mr Farai Rwodzi is also understood to be in South Africa meeting anchor shareholder Mr John Moxon on demerger issues.The powerful General Solomon Mujuru and his wife Vice President Joice Mujuru are believed to the the political force now protecting John Moxon’s interest.Moxon returned the favour by appointing Mujuru’s sidekick and business front Farai Rwodzi as Chairman of Meikles Africa Limited.

Failure by Mr Nigel Chanakira to come up with a firm proposal will see Mr Moxon and the Farai Rwodzi –Mujuru and Interfin Bank Zimbabwe syndicate maintaining a controlling shareholding in Kingdom.

Apparently, Mr Chanakira has on four occasions failed to meet demands made by Farai Rwodzi,the Mujurus and Mr Moxon to pay for the entire Meikles stake in KFHL.

There are also reports that Mr Chanakira is courting BancABC to advance him US$15 million to pay for his stake.

At an EGM held on June 22, Meikles shareholders authorised directors to demerge Kingdom from Meikles.

However, the demerger process is yet to be implemented due to non-fulfillment of demerger conditions precedent.

The demerger is part of the solutions to end the contentious dispute between Mr Moxon and Mr Chanakira.

Meikles Limited formerly (Kingdom Meikles Limited) — a merger of Kingdom and Meikles, Tanganda, and Cotton Printers in 2007 touted the biggest deal on ZSE only lasted for about eight months.

Irreconcilable difference between Mr Chanakira and Mr Moxon lead to the proposed demerger — ending eight months of acrimonious fighting this has resulted in John Moxon joining the Farai Rwodzi Mujuru- Interfin Bank Zimbabwe syndicate whilst Chanakira has sided with Mugabe in one of the biggest corporate fights in post independence Zimbabwe.

It is important to clearly highlight deals like these as they are the ones that Interfin Bank Zimbabwe and Meikles Africa Chairman Farai Rwodzi has been benefiting from and assisting to lauder the proceeds. This should also accurately inform Interfin business partners such as MoneyGram International. Multi Choice Africa who they are dealing with. In addition entities such as Kingdom Meikles Africa chaired by Farai Rwodzi role in the on going asset looting and money laundering must be documented.

A highly detailed report by Catherine Philp a Diplomatic Correspondent and Graham Keeley in Barcelona, Spain alleged that Vice President Joice Mujuru has lost favour with Mugabe following reports that her daughter, Nyasha Mujuru del Campo, tried to sell 3.7 tonnes of gold and diamonds worth more than $15 million to a European company, Firstar. Mujuru was reported to be behind the deal and to have threatened the head of Firstar Europe, Bernd Hagemann, when he scrapped the deal.

The Vice-President of Zimbabwe has been accused of trying to sell millions of dollars in gold nuggets and diamonds in defiance of international sanctions.
Joyce Mujuru used her daughter as a go-between to seek a deal for the gold, according to Firstar, a commodities trader based in Britain, which says that it was approached in November.

Mrs Mujuru, , is among the 200 Zimbabweans specified by European Union and United States sanctions for alleged human rights abuses. The article entitled Gold and the General’s Daughter
http://www.ocnus.net/artman2/publish/Dark_Side_4/Gold_and_the_General_s_Daughter_printer.shtml

Firstar claims that Mrs Mujuru’s daughter and Spanish son-in-law, Nyasha and Pedro del Campo, offered to sell 3,700kg of gold for $90 million to Firstar Europe Ltd, a precious metal dealer. At the present market rate, one kilo of gold sells for $30,700 (£21,500).

Mr del Campo allegedly e-mailed Firstar offering 3.7 tonnes of gold nuggets with a certificate of origin from the Democratic Republic of Congo and $15 million of diamonds without certification. He claimed to represent two commodities companies, Onesafara International and Berline Equities Corp. But over the course of the correspondence, it allegedly came to light that the real seller was Mrs Mujuru.

Bernd Hagamann, the president of Firstar, told The Times: “Our investigations showed who was really involved in the deal — Mrs Mujuru — who is on our blacklist. So we refused.”

Mr Hagamann said that when he told Mrs del Campo that he would not buy “blood gold” she offered to change the certificate of origin to Kenya.

“We have no interest in buying gold from people running a country where people are dying of cholera or from Congo, where the money from any deal would be used to buy arms to kill more people,” he said. “This is bloody gold. These people are criminals.”
Mr Hagamann said that after refusing to go ahead with the deal and telling the couple that he was reporting them to the authorities he received a telephone call from Mrs Mujuru.

“She said, ‘Some people will visit your house. You and your daughter will have problems’. But I was not afraid. It was funny. I told her she would have problems coming to Europe.” That’s a quote from the Times report.

The article entitled Zimbabwe’s vice-president foiled in 3,600kg gold deal
http://www.timesonline.co.uk/tol/news/world/africa/article5796426.ece

Firstar posted the e-mail correspondence and documents concerning the deal on its website, saying that it wished to deter other blacklisted buyers. The documents included photographs of the gold nuggets and one of 13 diamonds ranging from one to five carats. E-mails between Mrs del Campo and Firstar detailed how the gold would be transported from Nairobi to Zurich once Firstar had paid $100,000 for transportation costs. A certificate of origin stated that the gold was from Lubumbashi, an area of the Democratic Republic of Congo with links to Zimbabwean officials. http://www.swradioafrica.com/Documents/Letter%20to%20Journalists.pdf

The case raises concerns about attempts by members of unsavoury regimes to break sanctions. Mrs Mujuru and her husband, Solomon, a former head of the national army, are among the wealthiest and most powerful people in Zimbabwe, with extensive mining interests, including the River Ranch Diamond Mines. The World Diamond Council has accused the company of trafficking blood diamonds by mixing them with Zimbabwean stones and smuggling them to South Africa.

http://www.zwnews.com/issuefull.cfm?ArticleID=20017
Farai Rwodzi has acted as financial Advisor and facilitator and custodian of the looted funds at Interfin Bank which he co-owns with the Mujurus and other related politicians.Most of the proceeds of the looting spree end up at Interfin Bank Zimbabwe chaired by Farai Rwodzi resulting in Interfin Banking Corporation always claiming to be “the cash rich Group” .Its clear where the cash is coming from.

This article appears courtesy of GMRI CAPITAL – www.gmricapital.com . It is original content generated for 3MG MEDIA – www.3mgmedia.ca .

Gilbert Muponda is an Investment Banker and Founder of GMRI CAPITAL . He can be reached at; www.ZimFace.com and www.facebook.com/muponda

Email: gilbert@gilbertmuponda.com . Skype ID: gilbert.Muponda

Twitter ; http://twitter.com/gmricapital

Phone: 1-416-841-5542

The sale of diamonds funded wars in Sierra Leone, Liberia and Angola for years. Under mounting public pressure to clean up its act at the end of the 1990s, the industry set up a global certification scheme in 2003 to eradicate conflict diamonds.

Although it reduced the number of conflict diamonds to less than 1% of global volumes from about 15%, lobby groups say there are still holes in the system in Zimbabwe and Ivory Coast, and Venezuela is not part of the scheme.

“Weaknesses in implementation, lack of political will among member governments and imperfect oversight and enforcement mean that problems still persist,” said Elly Harrowell at Global Witness, which campaigns against the trade in illegal diamonds.

“No one can be 100% sure that they are buying a conflict free diamond.”

Conflict or blood diamonds are gems mined in war zones.

Human rights worries in Zimbabwe have sharpened tension in the industry, with state security forces accused of killing hundreds of the more than 30000 illegal diggers who descended on its Marange diamond fields in 2006.

A compromise deal in July averted a crisis in the Kimberley Process – the global certification scheme that monitors diamond trades – and allowed for a resumption in diamond sales from the Marange fields, one of the largest finds in history.

Nadim Kara, at Partnership Africa Canada (PAC), which monitors the Kimberley Process, said the real test was still to come in Zimbabwe.

“In a way there is political will from some countries to keep Zimbabwe’s heels to the fire, but that political will is being sapped by the incredible economic potential,” he said.

Kara said much hinged on a review in September and PAC wants to see evidence of clear instructions being given to the military and police not to engage in illegal mining or smuggling and the granting of mining concessions to ordinary Zimbabweans.

Some jewellers, however, are still worried.

“We are very conscious and aware of the situation and it is something we take very seriously and are in discussions about the best way forward,” said Simon Rainer, chief executive of the British Jewellers’ Association.

Appearing as a witness at the war crimes trial of former Liberian President Charles Taylor in The Hague, British supermodel Campbell said she received “dirty looking pebbles” from two men during a charity trip to South Africa in 1997.

Campaigners welcomed her testimony, arguing the industry is still plagued by the trade in illicit diamonds, but some experts have cast doubt on the blood diamond trade and argue the Kimberley Process cannot possibly trace every gem.

In an opinion article to the Wall Street Journal, independent rough diamond consultant Jack Jolis said diamonds and war in Africa were not related, and certainly not more so than any other commercial commodity found on the continent.

“Most African diamonds are produced in places that are reasonably-to-perfectly peaceful (such as Botswana, Namibia and South Africa) whereas there are murderous African conflicts that rage elsewhere without the slightest ‘assistance’ from diamonds (such as Rwanda, Uganda and Sudan),” Jolis wrote.

And diamonds are not the only commodity misused.

A UN report estimates that in the past 60 years, at least 40% of civil wars were connected to natural resources such as timber, diamonds, gold, minerals and oil or control of scarce resources such as fertile land and water.

World Diamond Council president Eli Izhakoff said the flow of illicit diamonds was now less than 0.2% of global volumes. “I think that’s a wonderful thing. Virtually today there are no conflict diamonds traded,” Izhakoff said.

But New York-based diamond trading company Rapaport urged its members this month against trading in Zimbabwe diamonds, warning any breach would result in expulsion from its network.

“There is no guarantee that diamonds with KP certifications are free of associations with human rights violations,” it said.

Campaigners also say illicit diamonds – diamonds traded without certification – are making a comeback in Sierra Leone, Liberia, Ivory Coast and Venezuela and, together with the World Diamond Council, are calling for urgent reform of the Kimberley Process.

The proposals are to be discussed at a meeting in November and include introdu-cing majority voting to avoid vetoes to the current consensus-decision making; full-time staffing; improved monitoring and publication of its reports and actions. -

Full HBC Chart at BATS Real-Time Market Data by XigniteLONDON — Suddenly HSBC’s decision to jump into South Africa doesn’t look like such a great idea. London investors who bought into the bank’s stock on Monday sold it off the next day, sending its shares down by 1.2% on Tuesday after the bank confirmed it was in talks with Old Mutual to buy its 52% majority stake in Nedbank, South Africa’s fourth largest financial services company, for an estimated $7 billion. (See “HSBC Wants In On Africa.”) Taking control would boost HSBC’s presence in South Africa from five retail bank branches to 433.

HSBC’s move into this fast-growing emerging market is being billed as an opportunity to capitalize on the booming trade between South Africa and Asia, where the bank gets half its profits.

Yahoo! BuzzGiven the benefit of a day’s hindsight, the deal is starting to look expensive. “The transaction would look good on a PowerPoint slide with arrows pointing from China/Asia to Africa,” Citigroup analyst Ronit Ghose said in a note Tuesday. But HSBC is so large that Nedbank would only make a small impression, he added.

Nedbank would represent about 3% of HSBC’s ( HBC – news – people ) assets, and while the purchase would be manageable, Ghose works out that the return on investment would be a value-destroying 8-11%, depending on the final price paid.

So what about opportunities to underwrite booming trade finance between China and South Africa? Ghose points to ICBC, China’s largest bank, which spent $5.6 billion in cash on 20% of Standard Bank, South Africa’s largest bank, in 2007. The Asia/Africa connection drove that deal, but three years later, that connection generated less than 1% of Standard Bank’s revenues in the first half of 2010.

Speaking of other banks in Africa: Standard Chartered, a British bank with a significant presence in the region, held discussions with Old Mutual back in 2007 about buying its Nedbank stake, and reportedly again in May this year. Now StanChart seems to be out of the picture and Old Mutual is singing the praises of HSBC’s intentions; HSBC may have (unwisely) offered more than a rival that is better acquainted with African banking.

Post a CommentTo be sure, South Africa offers good prospects for investors who want to capitalize on trade with Asia, where it sends 30% of all exports. But to reach that goal HSBC must first successfully manage Nedbank’s retail operations in South Africa, which will see it face the country’s sluggish economic and bad loan problem, Ghose says.

Citigroup is forecasting real GDP growth of 3% in 2010 and 2011 for South Africa, compared to 5%-6% in many other emerging markets

It is important to note that any successor Institution which will take over Century/CFX Bank assets and Infrastructure and ZSE seat will continue to have this Ownership wrangle stigma until the matter is amicably resolved.Farai Rwodzi and Interfin Bank by trying to lauder this fraud and covering up the illegal asset seizures have opened themselves to severe reputation risk which will affect their operations and ability to do business beyond Zimbabwe. Below is a note I prepared in 2009 in response to some propaganda from the THEN Government of Zimbabwe,CFX lawyers and Shareholders who were working in cahoots with Farai Rwodzi and Interfin Bank Zimbabwe preparing to sanitize their then anticipated takeover of my Bank CFX Bank –Zimbabwe-

“The Government of Zimbabwe’s attempted frivolous rebuttal to ENG Capital’s legitimate claim actually confirms ENG Capital’s ownership of the disputed 309 million shares and ownership of Century/CFX Bank. Their only purported defence is that you should have complained earlier or you are specified so you cant do anything about it. This is just hiding behind technicalities without any real or meaningful response to a legitimate claim.

It is common knowledge that I was detained, arrested ,tortured and specified. The legal counsel Mr, Ziweni, whom I hired to represent ENG Capital, suffered the same fate, was arrested, harassed, intimidated, specified and unfortunately died under mysterious circumstances.

As I languished in remand prison, the RBZ Governor, Gideon Gono, embarked on an orgy of ENG Capital asset stripping and with the assistance of the body politic gained political mileage with a sustained Muponda vilification crusade. As part of this asset stripping the 309 million shares were “bought” by Gono’s front Network Investments , Kwangari Enterprises and others.
Zimbabweans were made to believe that ENG was bankrupt and that its only assets were expensive cars. To the contrary ENG was a solid financial services company which owned a bank – Century and had other tangible assets that far exceeded the liabilities, concocted by Gideon Gono. The rebuttal by the Government’s lawyer confirms ENG Capital owned Century/CFX Bank.

Please note that the very person, Gideon Gono, who declared ENG bankrupt, is the same person who sought my specification and is the same person who then authorized the disposal of the 309 million shares. This same person was also the beneficiary of the irregular disposal of the 309 million Century /CFX shares in collusion with the Zimbabwe Stock Exchange who violated various regulations meant to protect investors in a public company.
The government further claims that, “The transaction was done in 2004”, and “in terms of the Prevention of Corruption Act, Muponda is not able to conduct any material transaction on his behalf in respect of any companies he has invested in.”
The above statement assumes that I seek relief and am pursuing my claim through the compromised and tainted Zimbabwean judicial system, which the same system is willing to be used by corrupt politicians to punish the innocent while sanitizing financial fraud by elected officials. This partisan court system was the same used strip me of my legal rights and used to brand me a criminal without due process or the prospect of Habeas corpus.

As you maybe aware I am seeking the return and or compensation for 309 million Century Holdings Shares which were fraudulently and corruptly sold to a group of politicians including RBZ Governor Gono, Ministers Goche and Gumbo. They were sold to their investment consortium which had several shelf companies including Kwangari Enterprises and Network Investments. The sale of the shares was done on or about 12 May 2004 through a pre-determined and fixed price transaction called a special bargain. As a result the current CFX Bank is a product of fraudulent merger of Century Bank (owned by my company ENG Capital) and a much smaller CFX Bank which somehow got naming rights on the resultant Bank. This “merger” was just to hide the corruption and fraud.

It is clear that the asset looting and expropriation in Zimbabwe is being done by senior Government Officials directly or indirectly through fronts. This is why some targeted sanctions have been applied on some of the politicians because they need to be stopped from their attempts to launder the proceeds from businesses they have looted and unjust enrichment schemes must be stopped. Those who are acting as their fronts, associates and conduits need to take note.

As I have said there is an illusion and fallacious assumption that I wont be able to take action in Zimbabwe but depositors and investors must be cautious , be realistic and don’t take chances. ‘
This remains accurate. Farai Rwodzi and Interfin Bank will be exposed for what they are – a money ,asset and transaction laundering masquerading as a Bank.

ZANU-PF party spokesman Rugare Gumbo said Sabina Mugabe will be buried at Heroes Acre, a national shrine for loyalist politicians and fallen guerrillas from the liberation war that ended white rule in Zimbabwe in 1980.

She retired from Parliament in 2008 after a lifetime in politics alongside Mugabe.

The Zanu PF youths were complaining that Muronzi had submitted a written proposal during the meeting and yet the Copac team had not told them they could also do the same. The Zanu PF youths also said that they should be the only ones who should be allowed to make contributions during the meeting. “They took my written submission from the Copac team and tore it saying the MDC people are not allowed to write or say anything,” Muronzi said. The Zanu PF youths then turned rowdy forcing the Copac team to cancel the meeting. The youths were being led by Saineti Manyika, a village head. Muronzi has reported the case at Madziva police station.

Elsewhere, three MDC activists in Seke district, Mashonaland East were on Monday arrested on trumped-up charges of burning a house belonging to an unnamed Zanu PF supporter. The three Joseph Nyandoro, 70, Jacob Chivaura, 61, Mwarianesu Mutandwa, 63, who had contributed immensely during a Copac meeting held at Mupfuri Primary School in Ward 17 were apprehended soon after the meeting. They are still detained at Beatrice Police Station. One Brigadier Chanakira who is in Team 5 of the Copac team in Mashonaland East took the three to Beatrice police station.

In Robert Sinyoka village, Pumula South, Bulawayo, Edith Ncube Mafu, an MDC ward chairperson has gone into hiding after Zanu PF supporters visited her home last week and threatened her with unspecified action if she continued to mobilise people to attend the Constitution-making outreach meetings in the area. Five men driving a marked Zanu PF vehicle came to Mafu’s residence last week and ordered her to stop forthwith from mobilising people in the area to attend Copac meetings.

Meanwhile, in Mhuke and Virimayi villages in Zaka West, Masvingo province, Zanu PF youths led by one Faustinos Murambatsvina are harassing, intimidating villagers and threatening that they will set-up torture bases in the area if the villagers speak at the Constitution-making meetings.

The Crisis in Zimbabwe Coalition calls on the government of Zimbabwe to urgently put in place the necessary measures to ensure transparency and accountability to the people of Zimbabwe on the extraction of Marange diamonds and how their sale will benefit ordinary Zimbabweans. Instead of clamouring for a blank cheque to sell Marange diamonds without any form of accountability to Zimbabweans and to the Kimberley Process we demand that the government of Zimbabwe commit to immediate restoration of rule of law and respect for human rights its diamond industry.

It is unacceptable that the government of Zimbabwe should brush off serious allegations of serious human rights violations perpetrated mainly by the military in Marange diamond fields since 2008. These well-documented allegations include the killings of civilians, use of forced labour, widespread corruption and smuggling of the precious stones.

Despite drawing up a joint work plan with the Kimberley Process Certification Scheme in Namibia in November 2009, the government of Zimbabwe has not delivered on its own commitments, including the demilitarization of Marange diamond fields. At least 95% of the diamond fields remain under tight military control. Meanwhile, smuggling of Marange diamonds remains rampant, with the military, senior government officials, employees of the so-called ‘private investors’ – Mbada Holdings and Canadile Mining, implicated in the looting.

Crisis in Zimbabwe Coalition firmly believes that with the necessary structures in place to end rights abuses, channel diamond revenue transparently and inform accountability mechanisms, minerals can potentially play a crucial role in reviving Zimbabwe’s ailing economy. However, to unlock this wealth, the government of Zimbabwe must fully comply with the Kimberley Process minimum standards before trading Marange diamonds.

We further demand that Zimbabwe’s finance minister, Mr Tendai Biti, disclose to the people of Zimbabwe what concrete measures he has put in place to ensure that when diamonds are sold, the national purse benefits. Crisis in Zimbabwe Coalition urges the government of Zimbabwe to seriously consider setting up a National Fund to transparently and equitably administer wealth from mineral resources in a manner that benefits present and future generations.

Whether or not human rights issues are central to the Kimberley Process, Crisis in Zimbabwe Coalition believes that the government of Zimbabwe owes it to its people to respect human rights and ensure that no diamonds are mined against the backdrop of serious human rights abuses. To demonstrate commitment to the rule of law and human rights respect, the government of Zimbabwe must facilitate an independent investigation into human rights abuses alleged to have taken place in Marange and hold accountable all those implicated.

The people of Zimbabwe demand of their government to respect basic rights. The people of Zimbabwe demand that all companies operating in the country, notably those operating in Marange diamond fields, respect human rights and to fully account to them. It is morally wrong, and outright unethical for companies to do business in the context of serious human rights abuses.

Hence, to demonstrate its commitment to human rights respect, the government of Zimbabwe must drop all charges currently levelled against Farai Maguwu – a prominent researcher into the smuggling of diamonds and human rights abuses in Marange. Maguwu was on July 12, 2010 granted bail after 39 days in custody on charges we believe to be nothing but persecution – charges of allegedly publishing or communicating falsehoods prejudicial to the state in contravention of the country’s criminal code.

During the course of his incarceration, Maguwu’s basic rights were trampled upon by, for example, not bringing him to court within the stipulated 48hours and denying him medical attention. We believe Maguwu is being persecuted for his sterling work in exposing corruption, smuggling and human rights abuses in Marange.

The Crisis in Zimbabwe Coalition also wishes to state it has lost all faith in the ability of the Kimberley Process Monitor for Zimbabwe, Mr Abbey Chikane, to professionally and impartially discharge his assigned duties. Firstly, Mr Chikane made serious allegations which we urge Kimberley Process to independently investigate, that while on mission to Zimbabwe, suspected Zimbabwe state security agents opened Chikane’s bag and stole confidential communication which was subsequently published in local state-run papers. These allegations alone seriously undermine Chikane’s professional work as state security agents may have applied undue influence on him.

Secondly and more importantly, circumstances leading to Maguwu’s arrest raise serious questions on the role played by Mr Chikane in the lead-up to that arrest. And finally, Mr Chikane’s two ‘fact-finding-mission’ reports completely ignored and sidestepped the fundamental issue of human rights abuses. These human rights abuses, perpetrated predominantly by the military, are ongoing. According to Centre for Research and Development, in March 2010 alone, 24 cases of physical assaults were recorded, and two cases of rape.

In this context, the government of Zimbabwe must fully commit and publicly demonstrate restoration of the rule of law in the diamond industry by respecting all relevant court orders and rulings particularly relating to the legal rights dispute involving African Consolidated Resources (ACR). Crisis in Zimbabwe Coalition urges the government of Zimbabwe to speedily resolve the dispute in accordance with due process of law.

Due process of law and full compliance with domestic and international standards should be applied to government plans to forcibly relocate at least 4 200 families who live near the diamond fields. If relocation is found to be necessary, government should make sure that all the families are consulted, adequate compensation is provided for and there is provision of alternative essential services including clean water, education, health and sanitation.

In light of the above, Crisis in Zimbabwe Coalition makes the following recommendations to the Kimberley Process Certification Scheme and the rest of the International community:
1. Urge Zimbabwe to facilitate an independent investigation into human rights abuses in Marange with the view of holding perpetrators to account for their actions and seeking recourse for victims of such.
2. Replace Mr. Abbey Chikane as Kimberley Process Monitor in Zimbabwe and disregard his two reports on the same. Immediately appoint a new, professional and independent monitor to see through the full implementation of the joint work plan developed in 2009.
3. Urge government of Zimbabwe to set up clear structures for transparency and accountability before sale of Marange diamonds can resume. The finance minister of Zimbabwe should present clear plans on how diamond revenue will be channelled to the national purse to benefit all Zimbabweans.
For further information please contact:
1. Crisis in Zimbabwe Coalition
Contact Number: +263 4 704 418 Mobile: +263 912 471 670
2. Crisis in Zimbabwe Coalition Regional Office (South Africa)
Contact Mobile Number: + 27 73 5211 813

However, a comprehensive 53-page report compiled after the Annual Article IV consultation meeting in March showed that RBZ was failing to honour its promises and was deviating from its core business of financial sector and prices stability.

“Without appropriate oversight, the RBZ used the international reserves backing the statutory reserves of banks (US$80 million) and sold shares from its portfolio of securities at the Zimbabwe Stock Exchange (US$38 million) to finance its activities during January 2009 – March 2010, including operating expenses, quasi-fiscal activities, and repayments of debt to selected creditors,” the IMF said in a report released on Tuesday.

IMF said reducing banks’ exposure to the financially distressed RBZ would help mitigate risks facing the banking system.

“Specifically, a dedicated RBZ’s nostro account backing banks’ deposits to the Real Time Gross Settlement account should be established and its balance published daily,” it said.

It said the RBZ must dispose off non-core assets to “refund banks’ statutory reserves on pre-March 2010 deposits.

“The resolution of the remaining banks’ claims on the RBZ would need to be undertaken as part of the overall resolution framework for the RBZ’s liabilities”.

It recommended the bifurcation (splitting) of the RBZ balance sheet to isolate non-core assets and liabilities from those that are essential for performing RBZ core functions and the adoption of a resolution framework for overdue liabilities and transparent disposal of non-core assets.

The global lender warned that counterparty and credit risk in the banking sector ranged from medium to high due to a significant exposure to the RBZ (about 70% of banks’ capital), the drought-prone agricultural sector (20% of the loan portfolios), and the exuberant credit growth.

It added there would a significant increase in non-performing loans due to the projected slowdown of the economy.

The IMF said liquidity risk was high due to the deteriorating balance of payments position potentially causing a reduction in banks’ foreign assets.

“The banking system is also ill-equipped to deal with temporary liquidity shocks with no lender of last resort, the unavailability of the statutory reserves deposited at the RBZ, virtually no interbank lending, and a level of country risk that precludes liquidity support from abroad,” the IMF said.

IMF said external auditors reported serious weaknesses in internal controls and financial reporting, and comprehensive monetary statistics have not been published since early 2008.

It said that although parliament has passed amendments to the RBZ Act, the amendments did not reflect a number of the Fund’s technical assistance recommendations.

A new RBZ board, chaired by Gono, was appointed in May to steer the sinking ship at a time when creditors were baying for the bank’s assets.

IMF had recommended the appointment of a non executive chairman at RBZ.
RBZ is under funded to perform its lender of last resorts function exposing banks to risk in the event of shocks in the sector.
This year, RBZ was allocated US$10 million for operational uses, an amount monetary authorities say is too little.
But treasury believes more funding would be channelled after a comprehensive audit of the bank.
RBZ reforms are underway to clean the mess at the institution and align it global best practice.