FORMER Hwange Colliery Company (HCC) managing director Fred Moyo has been arrested on allegations of defrauding a local mining firm of $2,7 million, it has been learnt.
TAURAI MANGUDHLA
Moyo, who was arrested on Monday, allegedly signed an agreement sometime in April 2011 with shareholders of the Midlands-based gold miner, OX Mining, to take over the company upon full payment of a purchase price of $2,5 million.
Police spokesperson Assistant Commissioner Charity Charamba last night confirmed the arrest.
“He was arrested on Monday over fraud charges and is going to court tomorrow (today). I cannot give you further details,” she said.
The former HCC boss reportedly managed to pay only $850 000, contravening the purchase agreement which required full payment of the purchase price by end of June 2011, thereby making the sale null and void.
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However, Moyo is alleged to have fraudulently secured a $2 million loan from ZB Bank using OX Mining’s assets as security despite the fact that he was neither a director nor shareholder of the firm.
He is said to have later also secured $700 000 from Stanbic Bank using the miner’s assets to secure borrowing.
The move has prejudiced OX Mining owners Ox Drilling, Dirk Benade, and Sydney Steyn, who have a $2,7 million debt which is not of their doing.
According to information gathered by NewsDay, Moyo is currently seeking to sell 25% of the mine at $10 million.
Moyo”s lawyers GN Mlotshwa and Company could not be reached for comment at the time of going to print.
Moyo left HCC after the expiry of his five-year contract mid last year.