BY TATIRA ZWINOIRA
In today’s second analysis of the National Social Security Authority (Nssa) forensic report on the key individuals implicated in the State pension fund prejudice of US$175,25 million, NewsDay Business is focusing on former pension fund chairman Robin Vela and banker Ozias Bvute.
The report covers the period January 1, 2015 to February 28, 2018 and was done by BDO Zimbabwe Chartered Accountants.
Vela is a Zimbabwean investment banker and business executive most known for his role as Nssa chairman.
He served as the Nssa board chair from July 12, 2015 to March 27, 2018 when he was fired from the role over claims he was not resident in Zimbabwe and held a
The report, under review, found that Vela did not go to tender in Nssa awarding four off-take housing projects.
These included a project awarded to Housing Corporation Zimbabwe (HCZ) to build 8 000 housing units in Caledonia just outside Harare in July 2017; Metro
Realty (a subsidiary of MetBank) to build 695 housing units in Chinhoyi (August 2017) and another 809 houses in ST-Ives (July 2017); and Drawcard Enterprises
(Pvt) Limited to build 1 000 housing units in Gweru.
“According to the then board chairperson (Vela), off-take projects were an effort to meet the housing targets set by the government by delivering low cost
houses. We, however, noted that a number of key processes were not done before awarding the contracts. These included not going to tender, non-performance of
due diligence on prospective contractors, non-evaluation of investment proposals. The responsible officials indicated that this was due to pressure to award
the contracts within a short time frame,” part of the Nssa forensic report reads.
As such, the report found that Vela was involved in a US$304 million off-take housing project awarded to HCZ, US$17 million awarded to Metro Realty, while the
amount for the two remaining projects was not decided on.
Yet, the different firms awarded these housing projects have either delivered less than a tenth of these projects or not at all.
Of the amount awarded to these firms, HCZ received US$16 million, Metro Realty received US$7,85 million and Drawcard US$3,5 million. The off-take projects have
since been suspended.
Another area where Vela is implicated as having been corrupt is the recruitment of key personnel into the State pension fund.
The Nssa human resources management guidelines state that jobs are to be offered to interviewed candidates on merit.
But BDO Zimbabwe discovered in their investigations that in most cases top candidates were not offered jobs with approval being given by Vela of the other
poorly performing interviewees.
“Human resources committee chairperson told us that their mandate was to conduct the interviews and rank the candidates according to the interview results for
onward submission to either Mr Vela or the general manager. Interview results for the general manager and chief finance and operations officer were handed to
Mr Vela while the results for other executives were given to the general manager. There is no evidence on how the final selection was arrived at,” part of the
Nssa report read.
The Nssa report also found that Vela was involved in the creation of Treasury Bills (TBs) custodial arrangement with MetBank, during several business dealings
between the State pension fund and the bank.
As reported yesterday, while former Public Service, Labour and Social Welfare minister Priscah Mupfumira pressured Nssa into dealing with MetBank which was at
the time considered to be a financial risk, Vela is accused of creating the TBs custodial arrangement.
This resulted in huge exposures to Nssa which stood at US$62 003 796 as at the date of the Nssa forensic report was completed.
In November 2017, Vela is reported to have successfully sought the increase of board fees which was granted by the then permanent secretary (Ngoni Masoka)
which was irregular because the approval was supposed to come from Mupfumira.
After the approval, Vela reportedly gave executive management figures which were higher than those which were approved by Masoka and these were the rates used
till October 2018.
“The overpayment as a result of the irregular increase by the permanent secretary and unauthorised additional increase by Mr Vela amounts to US$86 322,” part
of the Nssa forensic report reads.
“Nssa should seek legal counsel on how to deal with the involvement of the former Board Chairman in overpayment of board fees. Board fees should be approved by
the parent minister in accordance with the requirements of the Nssa Act.”
In the face of all this damning evidence, Vela has since launched a challenge on the findings of the Nssa forensic report at the High Court of Zimbabwe.
“This is an application brought in terms of section 3(1)(a) as read together with section 4 of the Administrative Justice Act (Chapter 10:28) (AJA). The
application remains at all times inspired by section 68(1) of the Constitution of Zimbabwe 2013, which I have not invoked in the first instance by reason of
the twin doctrines of subsidiarity and constitutional avoidance. It is my contention that the Audit report, which I seek to impugn is without jurisdiction,
irregular, unreasonable, incompetent, biased, malicious and unfair in a manner which violates section 3(1)(a) of the AJA,” Vela’s filing at the court read.
“In the alternative, and to the extent that it becomes necessary, I seek to invoke this court’s review powers as set out under sections 26 and 27 of the High
Court Act as well as the common law. The grounds upon which that invocation is sought are the same as those already referred to above.”
Bvute, who is also a Zanu PF MP for Goromonzi North, was mentioned in the Nssa forensic report, being a director and group chief executive officer of MetBank.
Bvute is also a 50% shareholder in Metro Realty.
Concerning Nssa’s transactions with MetBank, the forensic report mentioned Bvute as being present on several occasions in several meetings between Mupfumira, the State pension fund and MetBank.
The meetings were as a result of Mupfumira putting pressure on Nssa to help solve MetBank’s liquidity crisis, despite the poor rating of the bank.
The first time Bvute is linked to MetBank managing director Belmont Ndebele, is in a meeting held in December 2014. This meeting is believed to be the time
when Mupfumira first pressurised Nssa to do business with MetBank.
“The forensic auditors concluded that the ill-judged investigations with MetBank left Nssa exposed to the tune of US$62 million. All figures in the report are
in US dollars. This helps to show the true value of losses to Nssa in light of the new Zimbabwe dollar regime following SI142 of 2019 which made it the sole
legal tender. We are not talking Zimbabwe dollars here no,” read part of an analysis by United Kingdom-based law lecturer, Alex Magaisa, on the Nssa forensic
“A study of the report and the transactions in which Nssa was involved with MetBank shows that some, though not all, of the managers believed that MetBank was
a ‘high-risk client’ which was unworthy of new credit facilities. Yet a running and curious theme is that Nssa continued to pour loans and other generous
facilities into MetBank, despite its well-known financial weaknesses and its ignominious record as a defaulter.”
As for the dealings between Nssa, MetBank and Metro Realty are mentioned as an example of the bank’s complicity in not operating above board as seen in the
issuance of US$20 million worth of TBs.
The money was part of investments held back between Nssa and MetBank for the latter to secure short-term market deposits and central bank accommodation with
the TBs having a one-year tenure in November 2016.
Near the maturity of the tenure, Nssa wrote to MetBank notifying them to prepare to return the borrowed TBs, but MetBank successfully requested a six-month
However, once the extension lapsed, MetBank refused to return the TBs arguing that Nssa had not given a two weeks prior notice as stipulated in the agreement.
This week, the High Court ordered MetBank to pay back the US$20 million worth of TBs stating that the bank was holding on to what belonged to it.