Today when I came upon a NewZimbabwe article with the title “The corporate rot Econet is hiding” I thought I had stumbled onto a typical “I hate Econet” piece. There’s enough supply of those on the internet and usually they are just emotional anti-capitalist outbursts that lack any intelligent engagement on the issue – so I’ve stopped reading them. This one is different. It’s not an emotional outburst. It asks some real questions and touches on real issues that have happened at the group (especially TN Bank) over the years.
The opinion follows the raid on The Source that happened some weeks ago, which we covered here extensively. We post below an extract of the opinion. For the full article, please read New Zimbabwe.
In this article, I am interested in drilling at what I find to be a questionable and typical case of corporate incest arising from the Econet and Steward Bank’s search and seize operation at the Source. It’s a matter that is of deep public interest for several reasons as follows:
- Econet is a publicly listed company, meaning that members of the general public are shareholders, so are institutional investors who invest public funds in the company.
- Econet’s several million subscribers, that it has tended to take for granted for years, are the Zimbabweans that it depends on for its very existence.
- By virtue of its mobile wallet service EcoCash, Econet is a pseudo-bank and holds deposits for millions of Zimbabweans, some of them so rudimentary that they will never understand where and who holds their deposits, especially village folks who just know that “mari yavo iri muEcocash”.
- Steward Bank, just like any bank, is a custodian of funds owned by the public. This is why even if banks are not listed, they are required to publish audited accounts every six months. But it’s not enough that banks are supervised by the central bank because in the past few years, several banks superintended by the RBZ have failed, causing severe losses to businesses and the general public. To be more specific, the public has lost money through banks that have gone under, such as Interfin Banking Corporation, Allied Bank, Tetrad Bank, Genesis Investments Bank, AfrAsia Kingdom Bank, Trust Banking Corporation, First National Building Society, United Merchant Bank, Renaissance Merchant Bank (which later became Capital Bank). Consequences of these closures to the economy, and lives of the people have been grave and painful.
The whole Econet /Steward Bank affair, to us the public, is not, and must not be an issue of client confidentiality because that issue will become a peripheral matter if Steward bank collapses on account of imprudent banking behaviour and millions of customers lose their hard-earned cash, including EcoCash deposits that are held at the bank. This is a matter of tremendous public interest, which is why I thank The Source for bringing it to our attention, and I have become more suspicious of Econet for trying to hush-hush transactions that in my view raise serious questions of prudence on the part of the bank.
The involvement of Tawanda Nyambirai in my mind makes the affair stink to high heavens. Key questions that come into my mind are:
- Why did the bank advance a loan which did not have adequate collateral security, as alleged, to Mr Chiyangwa?
- Why did Econet pay Tawanda Nyambirai and his firm $39.9 million for “consultancy” for its licensing and debt collection?
- Why was Nyambirai introduced at the controversial press conference as Steward Bank’s Head of Legal Services?
Tawanda Nyambirai presided over a struggling TN Bank, which we now know as Steward Bank. During his leadership of TN Bank, he was also the Chairman of Econet Wireless Holdings. There is no doubt that as chief steward of the TN group, he destroyed shareholder value and presided over the collapse of that company, and today, I do not see any of the TN furniture shops around town, even though there are competing furniture brands such as TV Sales & Home, Station Furnishers and so forth.
Mr Nyambiral as CEO of the TN group made a number of questionable and imprudent decisions, some of them downright silly. He opened several businesses that drained the business of cash, opening multiple leakage points in the business, bleeding the operation. There was TN Bank, TN Furnitures, TN Mart (supermarket), TN Grill, TN Bakeries, TN Health, TN Financial Services among others.
One wonders what else he was going to open had he had more access to cash, and it boggles my mind why TN shareholders let him go on and on doing that. He even toyed around with crazy ideas like opening a cattle bank, with villagers depositing and withdrawing mombes out of the bank – an idea that is not just crazy, but carries far more risk than the risk the Americans carried by collateralizing unsecured mortgages and selling them off causing a global financial crisis. Imagine Nyambirai’s cattle bank being hit by foot and mouth and the disaster that follows.
Nyambirai’s judgment as CEO of the TN Group, which now barely exists, was extremely questionable. For example, its mind-blowing that he agreed to a lease where TN paid close to $90 000 a month for the former Woolworths complex along First Street in Harare, replacing Kingdom Bank, that moved out on account of high rentals. At one point, he wanted to take over and lease council beer halls run by Rufaro Marketing. He wanted to create storage spaces for vendors to store their wares and vegetables for a fee, he said.
He also intimated on entering the transport sector, running commuter omnibuses. In 2011, he spent $2.5 million buying about 35% of Pelhams shares at a premium – add to that the additional costs of court fights he had with Oliver Chidawu over the same shares; needless to mention that Pelhams was a declining business. Nyambirai also bought an obscure water bottling business called Matonjeni which later went under. If his business group did not have a bank, it would not be as scary, but one must wonder where all the money to do these ventures was coming from, if not from that bank, which is now Steward Bank.
Putting Mr Nyambirai’s investment gambles aside, what was worrying is his judgment as CEO in a group that includes a bank which handles depositors’ funds. It was his problem and that of his shareholders, if he gambled with business funds, but a whole new nasty game when this involves bank funds. I say so because one of the transactions which Econet and Steward Bank sought to have The Source remove from their website, is about a loan advanced to Phillip Chiyangwa whose collateral security did not cover the loan.
I am aware that Chiyangwa and Nyambirai were, at the material time, very close friends. What is clear about that loan is prudential tenets of risk management were not followed. This makes this issue a matter of public interest because funds in Steward Bank belong to depositors, and not the bank’s owners. And in a case like this, public interest trumps client confidentiality, because many depositors have eventually suffered when banks fail. It’s also a matter of public interest because banks are presently saddled with non-performing loans. The RBZ recently set up Zimbabwe Asset Management Corporation to buy up this toxic debt off the books of banking institutions at a cost to the economy.
In June 2013, Steward Bank, then known as TN Bank, reported a massive US$10,4 million loss for the 14 month period ending February 28 2013. According to the bank’s financials, it took a US$10,3 million write down on loans and advances. Note that Mr Nyambirai had left the bank in December 2012, and this write down mainly relates to the period when he was TNs’ CEO.
So why is it that after presiding over this kind of performance, Tawanda Nyambirai was introduced as the bank’s head of legal services at a press conference, which introduction assumes he is working at the bank, again? Shouldn’t the bank take the public and depositors more seriously than this? Should he be seen anywhere close to Steward Bank, which now handles millions of deposits including EcoCash deposits which belong to low-income ordinary and hardworking Zimbabweans out there?
As a shareholder, I am troubled that Econet could have paid Mr Nyambirai and that his firm could have earned close to $40 million for consultancy services to the company. For goodness sake, why does Econet want a consultant to negotiate a licence with POTRAZ, and for debt settlement, yet the company has a team of executives who go to work every day between 8 am and 5pm?
Strive Masiyiwa is on record saying he had to fight Econet Wireless Nigeria (later to become VNetworks, and now part of Airtel) after the firm wanted to pay consultancy fees for a round of financing. He deemed this to be corruption. Now, $39.9 million is a hefty amount of money to pay for consulting services for a license renewal that is supposed to be straight-forward.
These fees are 5% of Econet’s $714 million annual turnover in 2014, and 20% of its declared profit after tax of $194 million in the same period. It is clear from Econet’s 2014 financials, especially note 14 of its financials which provides details of its intangible assets, that this consultancy fee is not capitalized in the $137,5 million fee that Douglas Mboweni announced as the licence renewal fee on May 30 in 2013.
It is also a well-known secret that when Econet took over the ownership and management of TN Bank, and pushed out Tawanda Nyambirai from the bank’s leadership, it had not conducted a proper due diligence. This due diligence, led by Tracy Mpofu, was done after the acquisition. This post due-diligence revealed that Nyambirai and his failing businesses owed several millions of dollars he was refusing to pay on account of the fact that loan agreements to related parties were not properly documented.
Could this be the incentive for Econet to pay Nyambirai shocking amounts of money as consultancy fees with a view to normalizing these non-performing loans? Did Econet follow its own procurement procedures in awarding Mr Nyambirai such an expensive “consulting gig”? Was the “consulting” service necessary? And why were some of these payments done through TN Harlequin, a non-consulting company?
Zimbabwean consumers have for years complained of overcharging, paying 23 cents per minute to make local calls. Econet, and other networks, have justified this by arguing and tendering an argument based on costs. No doubt, after paying out a large amount of $40 million to one individual and his companies, Econet was recouping those costs from us the consumers. Thank God POTRAZ was assertive in forcing the mobile operators to lower tariffs.
But I’d feel hard done and very aggrieved if Econet was ripping off consumers and then making these kinds of outrageous payments to Tawanda Nyambirai and his businesses. In fact, without any shame at all, Mr Nyambirai, representing Econet, mounted a fateful court challenge late last year in which he wanted the courts to order Potraz to reverse its directive to networks to lower tariffs. This court bid was dismissed by the High Court in March this year. Is it not shameful for this company to rip of consumers, including poor people in far flung areas like Binga, Mahenye and Dotito, so that it can pay $40 million to Mr Nyambirai in Harare?
There is no company too big to collapse in Zimbabwe. I never thought Kingdom Bank, even after an investment by international investor AfrAsia, would collapse and be interred in the corporate graveyard. I never thought Interfin would suffer the same fate with suave bankers like Rwodzi running it by proxy. Neither did I think Rennaissance Merchant Bank would also die a painful and shameful death.
But when these banks collapsed, all the shenanigans they were involved in started creeping out of the cupboard. Some of these banks, like Rennaissance, were conducting transactions with senior RBZ officials who were supposed to be providing oversight. Each of those banks has external auditors in the name of these reputable firms, passing an unqualified opinion year after year. But in the end, whatever they were hiding under the guise of client confidentiality came to the fore.
Millions of depositors have lost their lifetime earnings and savings through sleek and slippery bankers. A bank is an entity of extreme public interest, because it keeps public funds. Steward Bank must be subjected to even more public scrutiny because it handles trust funds for Econet’s EcoCash product. Some of these funds held in trust belong to poor people who have for a long time avoided banks. The EcoCash mobile wallet is used by vendors, cross-border traders, farmers, SMEs and poor households.
If you pay one service provider $40 million dollars, and advance partially secured loans to pals, it’s a serious matter of public interest and no amount of crying client confidentiality will override that. If there is any doubt, go and ask a depositor whose money is stuck in AfrAsia Kingdom Bank, Allied Bank, Royal Bank, Interfin Bank and Capital Bank.
The whole Steward Bank and Econet issue surrounding exposures made by The Source stinks to high heavens, not just for Steward Bank depositors, but also for Econet shareholders who have not been paid a dividend, and no amount of cover up will contain that stink.
Taonezvi is a former banker and an equity investor in small start-up companies in Zimbabwe, Botswana, Zambia and South Africa. He first acquired shares in Econet Wireless in its IPO when it listed on the ZSE in 1998. He attended the majority of AGMs and EGMs at Econet for many years until 2009, chaired by both Professor Norman Nyazema and Tawanda Nyambirai. He regularly moves between South Africa and Zimbabwe. Taonezvi holds a business postgraduate qualification from an Ivy League university in the USA, where he carried out research on code driven versus regulated corporate governance issues.
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44 comments
Interesting. We get it, Nyambirayi is a bad guy (mostly over enthusiastic, if I read the article right), he shouldnt be let near swads of cash, he shouldnt be leading anything Econet/TN/Steward/Kombis or whatever.
But you are missing the big headline here: WHATSAPP NOW HAS ROUNDED ICONS!
Amen.
seems Kabweza has a personal beef with Econet, nothing sensible from a business persepective in this piece, sorry try again
the facts as given in the article speak for themselves to the fact that econet is not adhering to basic corporate governance norms.
what facts comrade, these are simple hallucinations from a frustrated Eliphias who is trying to revenge lost cause with Econet, as for the writer he chose what he himself thought was the best uppercut on Econet but neeeh, take it eazy jealousy will eat you up till death while Ecowire goes haywire Internationally kkkkkk
Eliphas listed some things that you’re ignoring and choosing to attack the writers. Why comment at all if you’re going to go after the people and not what’s being said? That alone says a lot.
When you write these comments where you accuse people of stuff, isn’t it fair to just make it clear that you’re an Econet employee so people can read your comment with that in mind?
Makuwanza maFeelings baba
kkkkkkk no hard feelings lsm people are just testing your level of elasticity, after all why do you feel attacked after you had simply copied the text from original author without manipulating, be social this is why you gave this room on the platform, cheer up
what’s this ‘feelings’ stuff you’re on about? I just asked you, The King, SoTypeMe & Skito to disclose in your comments that you work for Econet so people understand your defence of the company better.
Seems you are now losing it man, just chill
Hahaha, ndomaFeelings andiri kutaura. Chill out, not everyone will agree with what you say, that’s life. Not an Econet employee and I did not criticize your article. You are funny, never thought you would stoop this low
I think that this is an interesting story if it is true – it is odd that Econet use a ‘consultant’ such as Mr TN who has led so many businesses in failure – it cant be that good for keeping a clean and trustworthy brand . Are they grateful to him for something? and $40m is a lot of money to pay for anything especially ‘consulting fees’- remember that could even buy Telecel apparently!
kkkkkk its funy you now want to be the supervisor of banks bcoz RBZ had fail. You now know more than the RBZ which bank should do this and which one should not do that , to the extent that you start going around stealing banks confidential information bcz Nyambirai wants form a cattle bank ,that is nonsense. That is why mazimbabwe tisinga budirire . instead of focusing on the bussines aspect of the issue you want to involve us in your fight against be it Nyambirayi ,econet , steward i can not even tell which way you are coming from.
you wanted econet to pay u 39.9 million bcz u were following every step made by nyambirayi, bull shit. Better take your case to the courts.
Can the writer have their banking statements and records published for the public and be happy about it? So because Econet is public company it means they should not use the law to protect themselves people can steal from them willy nilly? Why don’t people attack the judiciary for assisting Econet/Steward Bank to raid the News Agency? It would have been different had Econet gone solo to raid the Agency. Tikwanirei Vamunyori.
You’re missing the point. The writer is not a person of interest to the public. They don’t hold anyone’s deposits. Econet via EcoCash does. Chiyangwa too is a person of interest. So is the government that was loaned money. It is an entity of interest.
But even as a person who the public is not interested in, I’d still let anyone look at my bank and EcoCash statements if they wanted. Even have them published. Nothing to hide.
Yeah, nothing to hide I’m sure. But I bet you’d still be pissed off if Econet were to release that information to the public without your consent.
I think the point Murozvi is trying to make is that Econet is simply doing what any corporate entity would do: jealously guard its information. If companies could have it their way, we probably wouldnt even get financial results published publicly. But we have The Law to keep these companies in check, as well as protect these same companies to a reasonable extent. Econet appealed to the Law so tariffs wont be reduced, they were shot down. Econet appealed to The Law to have some information kept private, it was approved. See? ts actually the courts we should be after. Since when have we become naive enough to expect companies to act saintly? They are in it for the profit. So when they over-step, it should be the guardians of the Law we should be after for letting them
It’s not Econet that released the information, it’s a publication that rightly thought it was newsworthy and that the public deserved to know. Everyone understands that. Steward bank could have easily just released a public statement absolving themselves of the disclosure of the financial information and explaining that they were investigating to find the thief or that they had found him and (i.e. dealing with the theft problem that makes customers lose trust)
Raiding a media house doesn’t do anything to help with the trust problem. If anything, it makes me trust them less because it looks like they have things to hide that would cause them discomfort. I wouldn’t want to be banking with such an institution.
Again, if you’re Econet employee, I think it’s fair to let readers of your comment know it so they understand your comment better.
While we are at it: all those who work for The Source or any other media outlet should make it known so we can understand their comments better. It would also be helpfull if all those who work in the Judiciary to identify themselves too, especially in Harare, to make their comments understood better.
C’mon Kabweza, you are a better blogger than this! Where’s the joy in the comment’s section if it’s now a pre-requisite to disclose where one ‘is coming from’?
So Kwabeza, what is your position on The Source being advised not to publish the information and then going against that? Its a two way street here.
I don’t know the full circumstances of the “document theft”. If The Source played a part in stealing the documents then they shouldn’t have published them. If the documents were simply brought to them by a source then they were right to publish them.
LSMK is losing the plot. Waimbospaka mdara, handikunyeberi. I would look forward to your articles because they were factual and not (that much) biased. These days it seems you are on an Econet hate parade and that all you seem to be bothered with these days. Again, whats with the excessive Click-baiting these days. you need numbers, we know, but its pretty darn frustrating!!
Coming to this story. We know its your personal blog, and you write your opinion, but just dont force people to run along with your it. Why are you so on about revelation of identity. Econet, Telecel or MTN employee it doesnt matter, they are not spokes-people for the company, period. I am sure they are writing in their individual Capacity, just like allbody else. Why dont you go on and paste their IP addresses all over the blog kana zvichikusvota. You have done it before and CyberBullied your way into divulging a Commenter’s IP. Chiiko newe mazuvano nhai??
You mention about Econet guarding its information jealously. You have disclosed your lack of understanding corporate governance practices and norms. There is no piece of information that Econet should hide since it is a publicly listed company and has companies such as NSSA and Old Mututal ias its shareholders, which are stewards of financial resources contributed by hard working Zimbabweans.
There are serious corporate governance issues raised in the original article, if you have cared to read it, that Econet must address. Nyambirai is in essence a failed banker who must not be seen anywhere close to any banking corporation, let alone, the same bank which he allegedly run down, and which is now a steward to hundreds of millions of dollars deposited into it, through Ecocash by low income earning but hard working Zimbabweans.
I would like to believe if this issue had happened at NetOne or any other state enterprise, this issue could have been blown out of proportion and everyone would be crying foul and alluding to the corrupt tendencies of the government fat cats. But because it is Strive Masiyiwa’s Econet some people found it, in their wisdom to disregard the essential issues of corporate governance raised, since the same company is a public listed entity, and ignorantly defend the company. No. The company, Econet and Steward must be brought to accountability and must explain themselves on these corporate governance issues raised. There is rot of corruption at Econet and the company must explain itself.
We are saying the exact same thing. Here is what i stated:
“Econet is simply doing what any corporate entity would do: jealously guard its information”
It wasnt a commentary on whether its wrong or right (I personally think it falls mostly on the wrong). My main point was that we shouldnt expect companies to act ‘santly’ because they would naturally do anything to protect their interests (especially the profit motive).
The Law, as interpreted by the courts, should act to keep these entities in check
they are. And the judiciary is attacking back. Unfairly so if i should add.
http://www.techzim.co.zw/2015/04/news-agency-source-fails-get-econet-case-referred-con-court/
Is it possible that Nyambirai is a conduit for Strive? Strive Masiiwa is an astute business man, why would he continue to associate his business(es) with Nyambirai given the litany of failures he is now notorious for? Doesn’t make sense! Conduit, just like Cashbert.
If I was the author of this page, I would have used a pseudonym to participate in the issues being raised by other people here. Coz trying to play the ‘anchor’ role on a public forum has a lot of negative connotations and people will start losing confidence on your reputable workmanship “silence is golden”.
Why do i have this feeling that the writer hates Econet. Anything contradictory to your views regarding Econet in this story, you want the blogger to affirm that they are from Econet. Econet please something for a friend in need maybe he will change his mindset on you.
I am the author of the said article cited by Techzim from New Zimbabwe.com.
I think that some of the commentators here, such as Skito, Sotypme and so on have not read the full article and the issues raised in it.
The issues raised for your benefit are:
1. I have known Econet since its listing in 1998, perhaps longer than many people here have been close to the company. I have been a shareholder since then. Econet is not a private company, its a public company that has been supported by Zimbabweans, and much of that support arose from the view that it was an underdog. Back then, it was not the arrogant corporate bully it has become.
2. Steward Bank simply exists to take deposits and loan them out, and provide ancillary services around that core function. That is the role of a bank. The money in that Bank neither belongs to Econet, nor Steward Bank, it belongs to depositors, many of them low income people using Ecocash as a wallet. When Steward Bank and before that, TN Bank, under Nyambirai’s leadership, gives Mr Chiyangwa a $2,1 million loan, with only $700 000 worth of cover, this is extremely terrible risk management. Depositors of that money deserve to know that the bank is taking to much risk.
3. When the bank takes too much risk like in the Chiyangwa case, where it is exposed via such a non-performing loan, Mr Chiyangwa’s confidentiality if far more peripheral than depositors knowing the level of gambling the bank is doing with their money. This is why in some countries such as the US, they have developed mechanisms to encourage whistle-blowing to make sure that this “confidentiality” you keep harping on about can be pierced. If you follow internationa newsl, you may have heard that under the cover of confidentiality, HSBC was aiding customers across the globe to evade tax through its Swiss private banking subsidiary. This issue was made public by HSBC’s IT expert Herve Falciani. He was arrested in Switzerland but escaped with the data to France, where French authorities refused to extradite him, but used the data to investigate the bank. In December 2012, HSBC paid almost $2bn in fines and signed a five-year deferred prosecution agreement with US authorities after admitting that it processed drug trafficking proceeds through Mexico and transmitted funds from sanctioned countries including Iran. HSBC, hundreds of thousands times larger than Steward Bank has apologised to the world. It has not tried to hide under the cloak of client confidentiality!!!
4. As an Econet shareholder, I find it despicable and outrageous that Econet can pay a consultant in the form of Nyambirai $40 million to negotiate for a straightforward licence from Potraz. Please note that Econet has a CEO, a board, executives and a whole legal department which can do these negotiations in the course of their jobs. Please note these negotiations were not even necessary because the government was hungry for cash to run elections in 2013. Also note that the $40 million paid out is 20% of the profit after tax made by Econet in 2014. So either the entire transaction was fraudulent, symptomatic of incompetence or some form of money laundering or swindling. If you say I have beef with Econet – yes as a shareholder, I have serious beef with this kind of ineptitude by people running the company. This kind of looting at a small company like Econet in the name of consultancy is unprecedented. Please note that Econet is an SME by global standards.
5. Steward Bank, introduced Tawanda Nyambirai as its head of legal services. Nyambirai almost ran down the bank, leading to its takeover by Econet – why employ the same man who failed the bank in the first place, and whose businesses (TN this and TN that) have collapsed, as its head of department?
6. Econet has had too much unacceptable conflict of interest, corporate incest and violations of good corporate governance for long. When Nyambirai was chairman of the company, many of his companies provided services to Econet – including his law firm with Beatrice Mtetwa. He chaired Econet and gave his own company a legal services contract – which was previously held by Kantor and Immerman. This is serious conflict of interest.
7. When Econet removed Nyambirai as chairman, it immediately appointed Beatrice Mtetwa to the Econet Board, another serious conflict of interest since Mtetwa is a managing partner of Mtetwa and Nyambirai legal practitioners. This is an unacceptable corporate governance violation for a listed company.
8. Its not enough to say there are regulators because these regulators have been there sleeping on the wheel while banks were closing one after another. All the banks that collapsed had auditors from firms like EY, PWZ, Delloitte etc who did not question and qualify the audits they undertook prior to the banks’ collapse.
So for some guys here just jumping to Econet/Steward Bank’s side, its probably just a reflex action. I am certain you would also jump to its side even if it was bilking you. But its your democratic right to support anyone when they are offside. Some of the comments are possibly coming from tech guys working at Econet who have very little understanding of banking and corporate governance issues. I hope my comments here won’t fly above your heads. But I know Masiyiwa and company have read this and have taken note.
Feel free to engage if you want via my email eliphastaonezvi@gmail.com
Got to admit, you made a point here especially on the issue of paying TN to negotiate licence fees
Thank you Eliphas for such an insightful article that has disclosed to many the violations of basic corporate governance norms and practices taking place at Econet. Econet is a publicly listed entity subjected to scrutiny by all interested stakeholders, including the subscriber in Shurugwi and Dotito.
Now, the fact is that this issue actually dwarfs that of PSAMS under Cuthbert Dube in terms of violation of corruption and violation of corporate governance basic norms.
Nyambirai is a failed banker, and must in essence never seen anywhere close to a banking corporation especially, the same bank he rand down.
If this issue had happened at NetOne, it could have been a serious issue subjected to much outburst and condemnation. So why try to hide it because it Strive’s Econet.
Interesting discourse. Now I’m curious, if TN is so bad, why is Econet keeping him on. And not only keeping him on, but involving him in a whole lot of business? What hold does he have on the company?
Not a sarcastic question by the way, am genuinely curious.
Because he is part of a corrupt network at the company. He is not doing this alone. It is a network. Indeed, it is a very foolish and sarcastic question you have posed. The generality of people who have an interest in Econet, including my granny in Shurugwi who is an Ecocash subscriber is not concerned about that. She is concerned about the safety of her deposits around people like Nyambirai who have failed dismally in business, particularly banking.
Econet is keeping him on, because they are equally bad. A corrupt lot hiding under a false facade of good corporate governance and a God fearing entity. No! We are not going to be fooled by that.
We ain’t stupid.
Am glad this article by Eliphas has made it in the Zimbabwe Independent today. The fact of the matter is that there has been grave violations of basic corporate norms and practices at the supposedly mighty Econet. It baffles the mind, even the average and ordinary mind, how someone can be paid a whopping $39.9 million dollars for facilitating a license renewal and arranging the debt settlement deals on behalf of Econet.
Indeed, Econet, as has been put across by Eliphas employees numerous executives and a legal team whose responsibilities, among other things is to have negotiated for the same license renewal and debt recovery deals.
This is a typical case of corruption and utter disregard of corporate governance norms and practices, that was unearthed at PSMAS under Cuthbert Dube tenure, which case sent the nation into outburst and condemnation of the issue.
Those who are arguing and defending Econet, must do so only on the confines of the facts raised by the author.
Tawanda Nyambirai is a failed banker, who eroded shareholder value and made some very grave mistakes and questionable decisions at the then TN Bank. Such people must not be allowed anywhere near a bank, especially one that is holding hundreds of millions of depositors money through Ecocash.
We refuse to accept that this issue must not receive the scrutiny it deserves since Econet is a public company, simply because it is Strive Masiyiwa’s Econet. Strive Masiyiwa is not a deity. There is no company big enough to fail. Especially considering the fact that Econet, by global standards is an SME.
WE read of similar scandals that happened at once mighty companies in the USA like Enron. It is these disregard of corporate governance best practices that set a company firmly on the course of decline. Why do people choose to play a blind eye to this issue? Steward Bank is a custodian of funds owned by the public.
I have my few dollars in Ecocash so does my granny in Shurugwi. I have reason to be concerned. How does Chiyangwa get a $2 million loan, with security of a mere $750 000. The same person who approved such a clear imprudent decision, that was made with utter disregard to best practices in risk management is still allowed to hover around the bank, as the Head Of Legal Services. No.
This is a serious scandal. A scandal that actually dwarfs that of PSMAS. Econet must account and must explain themselves especially responding on those facts raised by Eliphas in his article.
Nyambirai is a disaster, a corporate thug. And how is allowed near a bank. Just because he was involved in the story of how Econet was founded must not be reason why he gets away with corruption.
No, Hell No.
Pro-Econet guys – you’ve been served, bravo.
You’ve all suddenly lost your voice – what happened to all the insinuations, ad hominems and shooting the messenger now that the quoted author has arrived in person?
ya personal
dont involve us
Even more interesting to read the whole article in the Zim Independent today. I think it is a relevant issue to be made public and discussed – the whole Source raid / Nyambirai conflict of interests and concerns over the failings of the whole TN group. My company is still owed money (for over a year) by parts of the failing TN group and this Econet story is relevant to all who could be affected by it. Why does Econet still employ Nyambirai on scandalous fee levels ($40m is a lot of man hours to bill) after all of the failures he has lead recently? Opinions are opinions I think LSM has done ok on this one.
Thanks Eli. You full of wisdom, the world is full of people with varied view points even if you are right i may have my own angle of viewing it, so nobody should be hurt by that, but coz you are a guru, you are not easily hurt by individual opinions. Keep up the good work Eli, you are insightful.
*Forums are for freedom of expresssion the same as that which has torched the fire in this story.
When your opinion is ad hominem, it can only be taken seriously if it has an identity. if you choose to to be anonymous then maybe focus on the argument at hand.
My 2-cent: I think the comment section could do with heavier-handed moderation, be generous in swinging the mighty banhammer.
Happy 35th Anniversary LSM, forward ever, backwards never.
the details of the uncovered transactions are definitely cause for concern, the way tha information was made public was however very wrong. infact that kind of information should never be published informat, No not under any regulation or law is any financial institution required to make public such information, not under any circumstances – it doesn’t matter that econet is listed and that they have millions of subscribers.
so econet was in very right to raid who ever they raided.
The issue hear is actually on the side of a seemingly flimsy risk management system at the steward bank. The relevant authorities should investigate because there seems to be something worth looking into here.
Lastly, tha publication that lifted the lid on this took one for the team, wat they did however is not to be condoned.
“People who are competent but not masterful tend to be the most sensitive to criticism”!
Companies usually fail when they start to believe that they are too big to fail…
Corruption by its nature brings more corruption which in turn bring more corruption….THERE IS RAMPANT IS CORRUPTION AT ECONET and that is fact. When people complained about the corruption a Kingdom Bank people shot the messengers saying it was jealousy but look now Kindom is dead and gone. Need i say more Interfin, Trust, where are they now
Evil and corruption prosper when good men say nothing.. Thank you Eliphas you are alight in the darkness