Could this intricate web be at the heart of AirZim fight?

ZIMBABWE is a dying country. It is grinding to a slow, but painful death superintended by greedy public officials working hand-in-hand with powerful politicians.

Paidamoyo Muzulu

This combination of corrupt executives and mafia politicians, like vultures, is on the prowl scouring for carcasses of ailing parastatals to feed their want.

The aforesaid imagery may sound strong and evocative, but it’s a reality staring back at the citizens.

One need not look too far to prove the decay.

Most State-owned firms like Willowvale Mazda Motor Industries (WMMI), National Railways of Zimbabwe (NRZ), Cold Storage Company (CSC), Ziscosteel (now rebirthed as New Zimsteel), Agriculture and Rural Development Authority (Arda), Zimbabwe United Passenger Company (Zupco) and TelOne to mention, but a few, tell the story.

However, for now troubled national airline, Air Zimbabwe (AirZim), will suffice as an exemplar of this new phenomenon.

The choice of AirZim is deliberate because it is the only State-owned company so far that has done a comprehensive forensic audit of its state of affairs.

Reading through the AirZim BCA forensic audit report, one gets a sense that Zimbabwe has slipped into a mafia state where a few executives in parastatals or quasi-government organisations with close links to politicians are milking the country dry.

The report unearthes corrupt procurement activities at the national airline particularly the purchase of aviation insurance and aircraft parts.

The airline was allegedly fleeced of over $10 million in four years in a well-orchestrated insurance rip-off involving senior management and approved by both the airline’s board and line Transport and Infrastructural Development ministry.

The national carrier awarded Navistar Insurance the multi-million dollar contract to cover AirZim’s fleet, cargo, officers and passengers.

The contract was given without going to tender supposedly under the impression that ZimRe was under sanctions following the 2009 notice from the European Union.

The airline’s executives and remaining pilots were living large at the expense of other employees who went for months on end without receiving their salaries.

They received good perks including top-of-the-range executive vehicles, fuel, regional and international complimentary tickets and spending money as allowances.
The audit also unearthed that the airline could have lost more than $10 million in spare parts purchasing transactions that were done through middlemen instead of procuring them directly from the suppliers – Boeing.

Despite its declining revenue base, the airline staff rose to over 1 360 employees against the 11 planes operated by AirZim, whose fortunes continued to sag.
The planes are three MA60s from China, three Boeing 737s, three Boeing 767s and two leased Airbuses A320.

The airline later leased an Embraer Jet for its domestic flights.

It recently emerged that the two leased A320 Airbuses have for the last four months been grounded at OR Tambo International Airport in Johannesburg, South Africa, amid disclosures that the aircraft were unserviceable; one was being stripped of its parts to repair the other.

Upon receiving the BCA audit report in December 2013, the fired Ozias Bvute-led AirZim board immediately suspended nearly all the executives implicated in the report.

Among the suspended top officials were company secretary and acting managing director Grace Pfumbidzayi, acting group chief executive officer Innocent Mavhunga, finance director Nicholas Mujeri, finance manager Patience Tichagwa and human resources manager Oswald Madziva.

 

1-Corruption bubble chart  NEW.tif zim

Bvute had established himself at the airline and his hand and tentacles were spreading into every facet of the national carrier and even beyond.

To some, he was slowly turning himself into an executive chairman while he regarded himself as the national carrier’s “saviour”.

Soon after his appointment, his board started making a raft of changes in the organisation from the shop floor right up to the top echelons of AirZim — including its trading and/or business partners.

Most of the rot at the airline in the period under review happened under the watch of then Transport and Infrastructural Development minister Nicholas Goche.
Goche appointed the Bvute-led board and received weekly progress reports from the airline’s chief executive officer.

The Bvute board immediately appointed MetBank as principal bankers to AirZim, moving the main account from CBZ Bank and the board also transferred the controversial insurance account to Champions Insurance.

Bvute is a major shareholder at MetBank, but his lawyers say there was no conflict of interest in this move because Bvute recused himself from the meeting that made the decision.

But the Air Zimbabwe scandal has revealed an intricate web of connections and inter-connections between companies and individuals that points to collusion in the looting of the airline’s funds.

NewsDay investigations also showed that the national airline was paying over $4 million a year in insurance to its new brokers – Champions Insurance.
According to documents, AirZim pays 455 447 euros and $484 509 per quarter as insurance premiums to Champions.

Apparently, Bvute, who is also MetBank non-executive director, is the group chief executive officer of Metropolitan Holdings, the company that runs MetBank, while another AirZim board member Nathan Chikono is Champions Insurance managing director.

Bvute and his associates at MetBank, Peter Chingoka and Wilson Manase, also control Zimbabwe Cricket (ZC).

Bvute has since left ZC, but the organisation has since transferred its principal bank account to MetBank.

In addition, Bvute’s board also did not waste time to discipline the accused AirZim executives and immediately set up a tribunal headed by Harare-based lawyer Wellington Pasipanodya.

Curiously, Pasipanodya is a partner at Manase and Manase Legal Practitioners. Manase is MetBank chair and ZC vice-chairman while Chingoka is ZC chairman.

The disciplinary hearings, true to the emerging political dimensions in parastatal management, were playing out in the full glare of the media with convictions being publicised before judgments had been handed down.

Lawyers, speaking on condition of anonymity since the matter has become sub judice, say the best way for full disclosure of the rot at AirZim to be exposed is the holding of trials in open court.

They say this would allow the accused to subpoena witnesses for their defence especially ministers and board members who approved the deals.

This week, Transport and Infrastructure Development minister Obert Mpofu, in firing Ozias Bvute and his AirZim board, said it had failed to observe good corporate governance.

Mpofu said he learnt a lot about developments at AirZim from the media instead of getting it direct from the board.

“I received the forensic audit report on Monday this week where upon reading it I realised most of the issues have been reported verbatim by papers. It shows the board’s total lack of appreciation that there is an authority or sheer lack of corporate governance,” he said.

In an apparent move to sweep clean the rot at the troubled AirZim, Mpofu ordered that the forensic auditing exercise should be extended to December 2013.
It originally covered up to March of 2013 soon after the Bvute-led board was appointed into office.

“The auditors now have to cover up to the end of the year so that it also covers what transpired between March and the end of the year when the board took over,” Mpofu said.

It remains to be seen whether the handling of the AirZim saga will act as an example of how the other scandals at the Zimbabwe Broadcasting Corporation and Premier Service Medical Aid Society will be handled as divisions start to emerge in the government and the ruling Zanu PF party.

Cabinet ministers in the Zanu PF government are airing divergent views in public about the unravelling corruption and looting in the public sector.

Peculiarly, Local Government minister Ignatius Chombo last month ordered the reversal of Harare town clerk Tendai Mahachi’s suspension on allegations of refusing to hand over the executives’ pay schedule to Town House.

And, on the other hand, Vice-President Joice Mujuru in Chinhoyi attacked the media for being used to destroy Zanu PF by reporting on the Salarygate scandal and corruption in parastatals.

One is left with a sense, the Willogate scandal, War Victims Compensation Fund scam and Senior Civil Servants Housing Scheme scandal are coming back to haunt the nation and no action will be taken against the culprits.

22 Comments

  1. Goche is also part and parcel of this scandal. He must be sacked or he should resign from government

    1. Who was the deputy minister for the four years. Someone from MDC who was it.

  2. I bet you that most parastatal and even private company boards are like that. A web of interconnected and the same people looting… at the expense of the poor. As Zimbabweans we have many able people who can rise to be board members, but you see the same names over and over again being board members in a dozen companies.

  3. The emergency polit… meeting i guess was called to identify which guys to sacrifice and which ones not to. Someone is leading us up a garden path.

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  5. For once the newsday has some meaningful and positive coverage, wonder if this article is from your reporters or you took it from the herald? anyway, keep it up.

  6. The whole system has been a scum since the days of Paweni and Kangai, Enos Nkala, callistus Ndlovu, Maurice nyagumbo, dzingai Mutumbuka, Herbert Ushewokunze, Peter Nemapare, Farai Masango. Now Cashbert, Happy son and air Zim lot. The circus continues! These so-called learned people are only perfect at thievery!

  7. We develop as a country at the pace determined by the level of honest people among us. No thief will move this country an inch forward.

  8. Whatever happened to all the new, independent, indigenous airlines that applied for licences after the air transport industry in Zimbabwe was “liberalised” or “deregulated”. The press was full of stories about all huge aircraft they were going to bring in, capable of moving 1000s of pax all over the country and beyond! All “wet talk”… For Zimbos, it’s back to the days of the scotch cart!

  9. Bvute has never run a signle company that has been succesful. Everything he has run has gone bust. His tactic is whenever he takes over he rebrands, buys nice funiture for himself etc and then all of a sudden holes develop in the coffers. From Khulumani with Tich Mataz, ZC, Golf World for his wife by Sam Levy, to flower growing companies. Everything went bust. We all know that Metbank is bust. He is there because he is muzukuru waKamushinda and is not a banker though he holds a banking degree from India. He still run s ZC from afar as is evident from his connection with Manase and Chingoka who are board members at Metro Bank. Manse is the ZC lawyer but sits on the ZC board. So who approves the legal fees on that board? The ZC board is composed of yes men who can not question Chingoka and Manase. All those who dared to question were managed out. That is why cricket is dead as well

    1. How can you say that Chicoltrane, Bvute can run companies……..he actually runs them down! kikiki

  10. And remember ZC owes metbank millions of money. How does the ZC board come up up with a resolution to borrow from Metbank yet its the same people on the Metbank board. Is this not serious conflict of interest. Is Metbank offering the best rates to ZC? Who checks if Metbank is not creaming ZC. Esther Lupepe the ZC finance director is Bvutes maternal relative from the kamushinda side and they go to the same church SDA. She was put there to safeguard Bvutes interests in ZC.

  11. The land of my birth is bleeding to a very slow and painful death! Cry the beloved Zimbabwe, its a shame that all the potential has gone to the dogs? Where to from here?? Its time for the young people of the nation to rise up and take ownership of their future and heritage. Otherwise it will be a failed state like so many on the beautiful Mother continent.

  12. Mr editor and fellow press member should do a research of major company directorships in the country and publish linkages for our consumption.

  13. my neighbor’s sister makes $80 /hr on the computer . She has been fired for 5 months but last month her pay check was $17230 just working on the computer for a few hours. try this out ============>>>> http://www.jobs39.com

  14. The country had a President all this time? and Cabinet…… His Excellency & the Honourables…… whatever those words mean??

  15. ndinoda nyika yangu

    The reason why airzim didnt buy parts direct from boeing is that the 737-2NO that airzim have belong in a museum or a documentary. Boeing stopped producing those ages ago and stopped directly supporting maintenance except through approved 3rd party vendors

  16. Bvute of Metbank,Luxon Zembe of Psmas and ZIM, Rodrick Munhuwenhando Kadungure and Brain Janda from ZIM are all Seventh Day Adventists. Mere coincidence?

    1. @Gandanga. really? Mmm interesting indeed and what a shame!

  17. People please wake up to the Bvute / Goche smokescreen.

    The mastermind in the Air Zim Rot was Goche, a solid and corrupt individual who has a vast empire.

    Bvute is a seasoned criminal with very sticky fingers. Bvute and his board together with girlfriend Emelia Njovani were all placed in the airline to loot. It’s about time that ALL these people were put behind bars. Well done Pfumbidzayi for exposing Bvute and his gang of looters, the truth will soon set you free. Bvute must now pay for all his crimes. We are watching and waiting for final justice. Bvute you have harmed many!

  18. goodchildgonebad

    THE GOVERNMENT SHOULD NOT BE IN THE BUSINESS OF RUNNING COMPANIES,LET THE PRIVATE SECTOR DO IT AND THEN MONITOR CORRUPTION THERE BECAUSE PARASTATALS FALL UNDER MINISTERS WHO ARE POLITICIANS,WE KNOW THAT ZRP DOES NOT ARREST POLITICIANS FROM ZANU PF UNLESS THE ARE NO LONGER IN GOOD BOOKS WITH HIM EH U PEOPLE KNOW HIM.POLITICIANS HOODWINKED ZIMBABWEANS INTO BELIEVING THAT PARASTATALS WERE OF NATIONAL STRATEGIC IMPORTANCE WHEN THEY KNEW THEIR AIM WAS TO STEAL.THESE HAVE BEEN ON LIFE SUPPORT SINCE IAN KAZISO DOUGLAS SMITH LEFT THEM IN GOOD SHAPE,SOME CAME FROM HIS RURAL HOME JUST TO DESTROY CAUSE HE DOES NOT COMPREHEND THE IMPORTANCE OF SUSTAINABLE RESOURCE MANAGEMENT.LADIES AND WELCOME TO MAFIALAND AND WHOS DA BOSS,NO PRIZE 4GUESSING.

  19. It is this web of connection that has brought Zimbabwe to its knees. If you can actually count. Less than 1000 CHEFS have literally destroyed the lives of 14 million people. The sad thing is THEY DONT CARE!If you have seen Zimbabwean young women with babies strapped to their back begging at Gauteng traffic lights…..you heart sinks!We need people to have CONSCIENCE but this lot has lost it.

    It starts at the very top and I will say it. Ian Smith ,that RACIST used to have a 3-car motorcade. A 504 sedan, a landrover and another car. When travelling abroad it will be him and at least 10 other racists. This was despite the fact that the country at that time was stronger economically.

    Now uSeka Bona -Gushungo will have a 20+ something motorcade. When going travelling abroad civil servants ensure that at least he takes more than 60 people(for what?). These people will then be paid a daily allowance (Usually higher than their monthly salaries!).

    Our democratic government issued ministers with brand new Mercedes Benz and an additional SUV at the same date and time that Mpilo hospitals could not carry out life-saving operations due to shortage of essential drugs!At the same time UBH had no water!!And the local Resident minister pretended to be shocked! This is Zimbabwe for us:

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