These activities include: –
- Illegal externalization of foreign currency through transfer mispricing;
- Acting as banks outside the purpose for which they were originally licensed, as non-banking financial institutions. This includes, in the particular case of Ecocash, holding well in excess of ZWL$8 billion distributed across just over 501 000 agent/merchant lines as lat 10 June 2020, which is not under the scrutiny of the Financial Intelligence Unit;
- Fraudulently creating and issuing non-attributable and non-auditable agent cellphone lines/accounts;
- Hiding irreconcilable accounts in suspense accounts which hold huge credit balances for unjustifiably long periods;
- Ecocash, in particular, is acting as the centre pivot of the galloping black market foreign exchange rate and therefore, fuelling the incessant price hikes of goods and services that are bedevilling the economy and causing untold hardship to the people of Zimbabwe. In this regard, it has been conspiring with big merchants to act as their conduit through which they transfer hundreds of millions of dollars per day to runners on the street who then buy US Dollars on their behalf;
- Rampant, often arrogant, non-compliance with directives issued by the Reserve Bank of Zimbabwe and the Financial Intelligence Unit;
- Facilitating illicit trade in notes and coins, at contrived rates of between 30% and 50%, thus causing artificial shortages of the same within the banking system;
- Criminally allowing agent lines that were banned by the RBZ to continue trading illegally;
- Using bulk airtime sales at discounted prices which are cross rated to phantom USD exchange rates, which further distort the Zimbabwe market and deliberately mop up US Dollars from the black market, thus forcing up the rate of exchange in a manner that has hitherto been difficult to explain for the monetary authorities;
- Engaging in rampant unchecked tax evasion;
- Failure to report suspicious transactions or to take action against them;
- Creation of illegal transient and permanent money through airtime loans, unaccounted wallet-to-bank and bank-to-wallet transactions and other malpractices;
- Maintaining unauditable mobile phone lines or accounts which are being used by criminal syndicates, in connivance with insiders, to steal money from subscribers through such fraudulent practices as teeming and lading;
- Acting as conduits for the circulation of counterfeit USD notes; and
- Facilitating criminal activities through the non-enforcement of KYC requirements; and
“Ecocash, OneMoney, Telecash and MyCash Mobile Money platforms are all complicit in these illicit activities in varying degrees. Ecocash, however, which controls nearly 94% of all mobile money transactions, is the centre pivot of this problem and its resultant impact on Zimbabwe’s economy,”the statement said.
“The impact is exacerbated by the existence of fake counters on the Zimbabwe Stock Exchange, which is epitomized by the so-called Old Mutual Implied Exchange Rate (OMIR). This, in turn, results in four or more US: ZWL parallel market exchange rates operating in the market.
“At any time, therefore, there is the official rate, an Ecocash rate, a OneMoney rate and the OMIR among others. As the RBZ Governor aptly observed recently, there are multiple contrived phantom exchange rates in use in the Zimbabwe Economy, which conspire to defeat fiscal policy.” –Bloomberg/Own
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