A detailed report by NECI, seen by the Zimbabwe Independent, which probes white-collar crimes, shows NSSA is rotten to the core due to an extended period of sleaze and fraudulent activities.
NSSA, constituted and established in terms of the NSSA Act of 1989, is a statutory body tasked by government to provide social security to workers so that they have an income to look forward to upon retirement.
The corruption unearthed by NECI spans a wide range of areas, including tender processes, real estate projects that include building of houses and hotels, structured finance in all sorts of areas, even buying wheat, investing in shares, banking, including the money market, among various sectors of the economy.
NSSA directors and management also splashed money in buying mansions and luxury cars for themselves, while contributors struggle to lead decent lives after retirement.
At one time NSSA directors and management bought themselves vehicles worth between $100 000 and $230 000. The cars included a Mercedes Benz S350 and Jeep Cherokees. NSSA general manager James Matiza brought a house in Borrowdale for US$330 120 after securing himself a loan from the institution.
Some of the top NSSA officials negotiated deals for personal gain, including bribes and kickbacks. Former NSSA chairman Albert Nhau, for instance, got $100 000 after negotiating the sale of Ballantyne Park with property owner Dennis Green to NSSA.
“Nhau was the one who initiated the offer of the property to NSSA, arranged the initial meeting between Matiza and Green, and was even present when the meeting occurred,” the report says.
“The signing of the Memorandum of Agreement between NSSA and Green in the absence of guarantees by the latter on the issue of shares to be later converted and ceded to NSSA was at the instigation of Nhau. The events leading to the payment for the property was so frantic and hurried and at the instigation of Nhau”.
“Nhau directly benefited from the sale of Ballantyne Park to the organisation of which he was the chairman by receiving US$100 000 from the proceeds of the sale, to cover monies that he was owed by the sellers. There was undue influence and conflict of interest by the former chairman of NSSA on the purchase of properties, especially the Ballantyne Park property owned by one of his friends, Green.”
Nhau was replaced as NSSA chairman by top lawyer Innocent Chagonda in 2010.
The report says NSSA officials also had a big influence in the purchase of non-performing equities from Star Africa. When NSSA technocrats would advise not to purchase such shares, the chairman and the general manager would use their positions to coerce the investment committees and senior management to agree to investments they had interests in.
“Evaluation by these committees on whether to buy or not will be a formality. The chairman was very influential in driving NSSA into purchasing overvalued shares off loaded by these companies,” the report says.
“In some instances the general manager and the chairman are accountable for misdirecting the authority into the purchasing of shares at a premium yet the trend was that the share value was actually declining. Among the shares bought it is only OK shares that are better performing counters to date and the investment by NSSA stands out to have been a prudent one here, though shares bought from CFX are questionable.”
There was a conflict of interest in allocation of structured deal loans for David Govere, a board member, who chairs the board investment committee.
“He managed to access these soft loans for his two companies Tacoola Beverages and Harambe Holdings, while window had limited funds for a few companies, country-wide,” the report says.
It also says monies advanced to ReNaissance Merchant Bank (RMB) under structured loan deals could have been better placed with reputable institutions involved in grains commodity broking like parastatals and corporates in the agro-commodities sector. About $10 million was sunk in a botched wheat deal involving ReNaissance.
“The direct involvement of RMB in the importation of wheat was wrong, since funds disbursed for strategic national interest should be applied for such purposes. To further complicate issues, RMB did not deliver wheat, and the money was used for other purposes.”
There were also serious problems involving the organisation’s project to build a NSSA PARK, which would have resulted in the acquisition of properties around NSSA Building. Chibuku House, Dominion Building and Survey House, for instance, were purchased at suspiciously exorbitant prices amid charges of bribes and kick-backs.
“Woodlands and St Tropez apartments are also not generating any revenues as NSSA is locked in legal wrangles which have been going on for more than a year now,” the report says. “Revenue generation from rentals is very low as most tenants are not paying especially at Compensation House which house government departments.”
NSSA was failing to collect rentals, cars and fuel owed to it, in some cases, the report says. There were also problems with recruitment of top managers which were characterised by complaints of nepotism and regionalism.
“The recruitment of the current executives is very questionable, and it is not clear whether there was favouritism or not. Though normal procedures were followed, most of the executives come from the same area where the general manager comes from. The general manager being the ex-officio member of the board could have had much influence on appointments,” it says.
The NSSA probe was completed last year after it was established the year before to investigate the following allegations:
• Recruitment was based on tribal or regional grounds; the General Manager was involved in recruitment of the Directors of NSSA who came from the same province as him, Manicaland Province
• Other serious irregularities and allegations of corruption on the part of managers at the authority involved implementation of projects
• Buying directors’ houses – loans at zero percent (%)
• Directors got USD$200 000 as loans
• General manager and directors’ vehicles were purchased at US$175 000 each and salaries were at an average of US$10 000 per month
• Directors companies supplying materials on all NSSA projects, e.g. 2000 bags of cement to Bindura projects was supplied by NSSA director of investments ShadreckVera’s company supplying wrong type of cement and was rejected by the contractor only to be disposed at loss.
• Marondera housing project is not being completed in order to keep on pumping money from NSSA for their selfish needs
• Glaudina housing project, the directors are allocating themselves several stands and are using NSSA funds to build their own houses in the name of housing loans.
• They have removed the finance manager`s signature from all banks to conceal fraud. They now sign themselves. All junior staff do not sign.
• US$10 million loaned to Shepherd Shara of RMB for him to import wheat which never arrived in Zimbabwe. Loan repaid by advancing him more funds as the loan was about to be redeemed.
• US$9 million used to buy shares from Green’s company called the Ballantyne Park PL. Shares bought at an over price of $220 per share. One can imagine at that time the ZSE`s most expensive shares were going for $5. Green`s neighbourVera approved the transaction.
• US$2 million loaned to Africom without collateral security and the loan is for 20 years at 5%.
• US$3 million given to CFX Bank for worthless shares without going to Zimbabwe Stock Exchange.
• The biggest fraud of US$15 million used to buy ZSR/Star Africa shares without going to ZSE stock market. Deal was negotiated at home. Shares bought from Nhau`s friends. The price was pegged at 12.5 cents (US) instead of the average 10 cents from ZSE. NSSA lost US$2,5 million from the scam. They fraudulently used a broker to conceal the evidence.