Errant banks get amnesty

Vincent Kahiya

CENTRAL bank governor Gideon Gono has granted banks caught dealing in foreign currency on the parallel market amnesty on condition that they do not commit a similar offence this year, the Zimb

abwe Independent learnt this week.


The amnesty was offered in January to build trust between banks and the Reserve Bank, as enunciated in Gono’s monetary policy statement in December last year.


This revelation comes as three more banks are in trouble for dealing in foreign currency and are set to appear in court, the police said. The banks affected are Barclays, Kingdom and Interfin.


Police spokesperson Wayne Bvudzijena said the three financial institutions were set to appear in court soon.


“We are charging them with dealing in foreign currency. However, we will not be charging the directors but the companies themselves,” he said.


“They were supposed to appear in court yesterday (Tuesday) but there was a hiccup.”


The banks’ representatives should appear before a regional magistrate today or after the Easter break.


Banking sources yesterday said the provision of the amnesty would be a key defence for the banks against prosecution.


A letter to one commercial bank from Reserve Bank director in the supervision and surveillance division, Stephen Gwasira, stated the conditions of the amnesty.


“Consistent with the approach taken by the review authority, we are now granting your bank a qualified and conditional amnesty from payment of the loca1 currency financial penalty,” Gwasira said.


“This means you are relieved of the necessity to pay us the local currency financial penalty. The condition attaching to this is that your bank should not, within any period of 12 (months) reckoned from 13 January 2004, contravene provisions of any exchange control legislation in respect of which a further direction is imposed to cease dealings in foreign currency for a period in excess of six months,” he said.


Banks which had been fined for selling foreign currency on the parallel market were subsequently refunded the principal penalty.


“Please note that the granting of this conditional amnesty does not amount in any way to a pardon, and your guilt status still stands,” Gwasira said.

The Independent established yesterday that when the latest batch of banks were charged with dealing in foreign currency this week, they immediately responded by informing the police of the amnesty. Sources said government lawyers at the Attorney-General’s office on Tuesday told the police that it would be difficult to prosecute the cases because of the RBZ amnesty.


The lawyers said they would ask officials from the central bank to explain the nature of the amnesty and how it would relate to the cases at hand.


Last week mobile telephone service provider Telecel was fined $375 million by the courts for dealing in foreign currency.