WTR Logo
  • Facebook
  • Instagram
  • Twitter
Sign Up For Our Newsletter:

Zimbabwe: Illicit Front Companies Gobble Municipal Revenues.

Author: Walter Muraisi Date Published: 2017-06-14 19:06:35
  • Illicit Front Companies gobble municipal revenues. 

    Corrupt municipal authorities and their syndicates, are siphoning millions of taxpayers dollars from one of Zimbabwe's most important cities, in a scheme that is astonishing and bewildering.

    The trickery goes like this: elected municipal authorities form private companies and award themselves the priviledge to supply goods and services to the city at massively inflated prices. Such city bosses twist procedures to ensure that their companies are promptly paid in cash.

    Revelations show that one Mutare Municipality where the scheme has taken hold has suffered immense financial losses thus making the city unable to pay salaries for 7 months.

    Mutare is Zimbabwe's most important tourism city and the country's gateway to the Indian Ocean trade route.

    Because of this elaborate scheme, this city of 200, 000 residents is saddled with $US 30 Million in debts thus making it Zimbabwe's most indebted town. The city employs 1100 workers whose salaries gobble 75% of the town's revenue.

    The city's clerk Mr. Joshua Maligwa confirmed the looting and said the town's budget has beem bled to death by unscrouplous managers. "It is regrettable. There is no way the city can afford to pay salaries or even clear its massive debt as long as this shady web of deals continue."

    Mr. Maligwa who has launched an inquiry says he has now digitized all city goods suppliers list to determine if any if his senior employees are awarding themselves fraudlent contracts.

    "I have brought in new digital database measures to scrutinize all city employees who are dishonestly awarding themselves business contracts to supply the city with services in water, energy or public roads projects."

    This is a hard task to achieve says Tariro Bondo, an anti-corruption activist from the Transparency International Africa Changemakers Fellows Program. "Most of the culprits who score dirty municipal contracts are hiding behind a corporate veil. They use the names of their wives, cousins, friens or relatives to appear innocent."

    "For the culprits this is massive conflict-of-interest that pays lucrative profits. They wont easily give up. Expensive forensic auditors are needed to crack this scheme."

    Investigations by this reporter shows that most of the senior municipal authorities under probe use small companies established by relatives as "fronts" to score illicit contracts with their employer.
    Curiously, when it comes to payment, these illegal "front" are paid promptly by the city, added the town's clerk.

    "Our suspicions are valid. The city is broke and debt but suprisingly, our debts to these front companies are paid swiftly every week, in hard cash, in brazen violation of municipal electronic-funds-transfer municipal. This proves crooked senior municipal managers are simply siphoning taxpayers funds to pay services rendered by their front companies."

    An investigation invoice seen by this reporter for example, shows the municipality billed a massive $US320 for a set of car brake shoes that should cost $US100 a set.

    "To rub away their tracks, these front companies owned by our dishonest employees appear to rotate their services among a  pre-determined pool of front companies,"  revealed the city clerk.

    More often the culprits would seek quotations for municipal goods from big, established companies just to dilute their schemes and appear professional.

    "This is just a deceitful exercise by city managers to appear as if they are casting  their net wide. Genuine quotations from established companies would be cast aside in favour, falsely labelled as expensive, in order to do business with small crony companies that pay kick backs," said the city clerk.

    "Investigations are sensitive and ongoing. I have been in this town clerk job for only three months but heads will roll."

Quality journalism is expensive to produce. At WTR we thrive on your support. DONATE to keep investigative journalism alive

Leave Your Comment Here

the following fields are required to be filled out before leaving a comment. your email address will not be published.


All comments are mediated before publishing to ensure all content published onto this page is not offensive

WOMEN TABOOS RADIO is a digital news/media channel; the first in Southern Africa that powers Women to write, film, publish or broadcast exclusively on their sensitive gender, health, income Taboos topics. The goal is to break cultural taboos that hurt gender equality progress. Men too are part of our gender media focus. Our non-profit licence number is: 2016/462591/08