Pasi sought approval from juniors

Story by: Zvamaida Murwira - Senior Reporter

Suspended Zimbabwe Revenue Authority Commissioner-General Mr Gershem Pasi fraudulently awarded himself $1 million in benefits outside his contract, after seeking approval from his subordinates instead of either from the board or the parent ministry, an audit has revealed.Auditors also raised eyebrows over the circumstances under which he authorised the Zimra director of human resources, Ms Christine Msemburi’s, secondment to Kenya where she was paid relocation allowances and other benefits before approval had been granted by the board and parent ministry.

The audit said Mr Pasi should be held liable for a $128 000 performance award, leave encashment, air tickets, holiday allowances and other benefits paid to Ms Msemburi at a time she was not offering any service to Zimra since she was already working for the World Customs Organisation Regional Office for Capacity Building in Kenya.

This is contained in a forensic audit report conducted by HLB Zimbabwe Chartered Accountants into the operations of the revenue collector following reports of corruption and poor corporate governance by whistleblowers. The report is part of Zimra’s court record filed with the High Court while responding to Mr Pasi’s urgent application seeking to halt disciplinary processes against him. According to the audit, Mr Pasi would ostensibly seek approval from subordinates for him to draw almost $1 million at various intervals.

“Our investigations revealed that benefits that are not specifically stipulated in the Commissioner-General’s contract of employment are both approved and paid to him by his subordinates without board approval. During the period under review, the Commissioner-General was paid $374 451, $204 463 and $136 374 for motor vehicle allowances, holidays allowances and performance awards respectively without specific board approval,” read the report.

In one instance, Mr Pasi was paid $15 525 in legal expenses to negotiate his own contract while in another case, Mr Pasi sought approval from subordinate to have his daughter drive a Zimra vehicle.

“This amount ($15 525) should be recovered from Mr Pasi as this payment was of a personal nature,” read the report.

In March 2014, Mr Pasi was paid $5 000 international holiday allowance as per his contract but went on to make another claim in December 2014 of the same amount for holiday purposes.

It was also noted that Mr Pasi used a Zimra Visa card to settle personal debts without reimbursement to the tune of $85 000 in 2009 and unilaterally raised his per diem rates when he travelled to Kenya by claiming top-up when he returned.

After the anomaly was detected by external auditors, finance director Mr Robert Mangwiro instructed his two subordinates to raise the issue with Mr Pasi.

“We find it odd that the finance director chose to send a delegation of his subordinates to discuss this matter with the Commissioner-General,” read the report.

It also emerged that Mr Pasi was paid $21 219 in board fees which was not taxed but when confronted, the Commissioner-General declined to repay saying the tax should be deducted from his future board fees.

“Our investigation also revealed that Mr Pasi received board fees in the sum of $16 200 in spite of the fact that he is not a non-executive director of Zimra,” read the report.

On Ms Msemburi, the audit noted that Mr Pasi released her to commence work in Kenya and paid relocation allowances and other benefits well before the ministry’s approval and issues raised related to the financing model and synchronisation of her contract had not yet been addressed.

“The board approval was merely a condonation of a violation already done. There was no basis on why Ms Msemburi was paid $10 810, instead of the approved $5 800 for the cited periods. There is no evidence that the board authorised her prolonged stay in Kenya from June 2015 to September 2015,” read the report.

“Zimra should recover the $49 043, which it lost by way of unauthorised expenditure, attributable to Ms Msemburi.”

Mr Pasi approved payment of $28 512 as removal costs of Ms Msemburi’s household property and motor vehicle for relocation to Kenya without board approval.

“In fact, there was no evidence that the board was ever aware of this transaction,” read the report.

It was noted that Mr Pasi seconded Ms Msemburi despite facing major health challenges which had earlier on seen her working during mornings only thus compromising the name of the country, Zimra and her welfare as well.

“On 12 October 2015, Mr Pasi authorised Ms Msemburi to take 70 vacation leave days when the balance was 15 days. The difference of 55 days was taken as paid leave,” read the report.

Zimra also paid air tickets to Geneva, Switzerland, for Ms Msemburi’s daughter despite there being no provision warranting payment of airfares for dependants.

Zimra boss cooks academic papers – Audit exposes fake O-Level passes, degree

Lloyd Gumbo Senior Reporter

Zimbabwe Revenue Authority loss control director Mr Charlton Chihuri only has four Ordinary Level passes, but has been working at the revenue authority for 13 years after forging qualifications, a recent audit revealed.

This is contained in the forensic audit report conducted by HLB Zimbabwe Chartered Accountants into the operations of the revenue collector following reports by whistle-blowers of corruption and poor corporate governance.

The report is part of Zimra’s court record filed with the High Court yesterday, while responding to suspended Commissioner-General Gershem Pasi’s urgent application seeking to halt its disciplinary process against him.

“Our investigations revealed that Mr Charlton Chihuri misrepresented his academic qualifications to Zimra as early as 2003 when he first applied for the post of Loss Control Officer,” reads the report.

 “He misrepresented that he had obtained six Ordinary Level passes, scored six Advanced Level points and that he was the legitimate holder of a Bachelor of Science Honours in Economics Degree with the University of Zimbabwe.

“Upon inquiry with both the Zimbabwe School Examinations Council and the University of Zimbabwe (UZ), we established that he had misrepresented his results. He neither has six Ordinary Level passes nor does he hold any degree with the University of Zimbabwe. In actual fact, he has only four Ordinary Level passes excluding English, and he failed his Advanced Level examinations with two F symbols and an O symbol.”

The auditors said the UZ refuted claims that Mr Chihuri graduated from the institution and categorically stated that the degree certificate that he presented to Zimra was fictitious.

The auditors said Mr Chihuri’s file with Zimra contained a Master’s degree with the University of Liverpool whose legitimacy is being questioned given that generally one cannot obtain a Master’s without an undergraduate qualification.

“Mr Charlton Chihuri even failed Zimra training tests for supervisors and managers, scoring two F symbols for Tariff and Procedure 1 respectively. Ironically, he was being showered with performance awards every quarter by the Commissioner-General Gershem Pasi.

“The role of director Loss Control is crucial and cannot be efficiently executed by an unsuited candidate. The authority was prejudiced to the tune of US$1,6 million in remuneration paid to an unqualified person. It was surely upon the leadership at Zimra to put in place measures to detect such cases of academic fraud. These measures were not there and if they existed, they were not effective enough to prevent or detect the academic fraud.

“The conduct was damaging and could have far reaching consequences, considering that Zimra acts in the public interest. The reputation of Zimra as a state entity is put to task by this damning revelation,” said the auditors.

The auditors also established that another loss control officer, Mr Benjamin Zenda was employed without the requisite qualifications and through a process fraught with irregularities.

“Whereby the Commissioner-General gave a directive to Ms (Christine) Musemburi, the Human Resources director that he had head-hunted a person for the post of loss control officer and that had to be processed urgently.

“Apart from the fact that the post of loss control officer was not advertised nor interviews carried out, Mr Zenda was not qualified for the post as he does not hold at least an undergraduate degree. The special interest in the head-hunting of Mr Zenda by the Commissioner General is peculiar,” said the auditors.

The auditors also rapped management for failure to act on information that was supplied by a whistleblower and allowing Mr Pasi to direct employees of the authority to make misrepresentations that the authority had investigated and found no evidence of wrong doing.

“The whistleblower died in a car accident in July 2016 just two days before a scheduled meeting with one of the Zimra board members, with whom he was meant to discuss his frustrations regarding the matter. He left documentation with his lawyers now the executor of his estate,” said the auditors.

Suspicious loan stalls Zimbabwe Cricket audit

https://www.thestandard.co.zw/2016/10/09/suspicious-loan-stalls-zimbabwe-cricket-audit/

A SHADOWY bank loan of over $3 million, which has accumulated interest of $3,9m as we write, is one of the items stalling Zimbabwe Cricket (ZC)’s long-overdue audit of 2015, Standardsport can reveal.

BY DANIEL NHAKANISO/ ENOCK MUCHINJO

The loan now stands at $6,9m.

Two weeks ago, auditors HLB Zimbabwe sensationally disowned what appears to be a fraudulently compiled ZC audit report, revealing in a letter exclusively published by our sister paper Zimbabwe Independent a fortnight ago that they were still waiting for key information from the cricket governing body in order to conclude a credible forensic audit.

It has now turned out that the $3 850 000 loan secured from a local financial institution in 2011 is one of the sticking points raised by the auditors.

Asked to comment on the unearthed loan yesterday, ZC chairman Tavengwa Mukuhlani accused members of his staff and directors of leaking information to the media.

“The audit is still ongoing and I can only comment when it has been completed,” Mukuhlani told Standardsport.

“If I comment about an audit that is still going on, I am basically pre-emptying it and it will defeat the whole purpose. If I start throwing around figures in newspapers, it would not be proper. It’s unfortunate that people are probably leaking privileged information, whether correct or wrong, but I expect some level of professionalism from members of the ZC secretariat and the board because clearly, we now have a problem, where if the board members or members of the secretariat get the information, they are giving it to the newspapers.

“I believe it’s wrong as it defeats the purpose of the audit. We have moved a lot in so far as concluding the audit and we will avail the audit results to the people and I hope the stakeholders will be patient while the audit is still ongoing.”

After unearthing the loan, HLB Zimbabwe requested for documentation on the loan, and details of how it has been serviced since it was secured in 2011.

Curiously, the loan is not recorded in ZC accounts.

Standardsport can now also exclusively report that HLB Zimbabwe, a fortnight ago, asked for a ZC board resolution for the loan to be recorded in the cricket association’s books.

At a ZC emergency board meeting last week, ZC directors endorsed HLB Zimbabwe’s request and resolved that the loan be scrutinised and information handed over to the auditor.

Apart from the loan, The Zimbabwe Independent had also reported that one of the areas of concern in the fraudulent audit report, which Standardsport has a copy of, is an expense of $5,2m listed as “tours expense” — this despite the fact that a majority of Zimbabwe’s series during the year were bankrolled by other parties.

Audit sniffs out Zimra scandals

Lloyd Gumbo Senior Reporter—

A forensic audit on the operations of the Zimbabwe Revenue Authority (Zimra) has revealed endemic corruption, violation of Government laws and poor corporate governance among other shenanigans.

According to the report, all these happened under the stewardship of suspended Commissioner-General Mr Gershem Pasi and five other executives. Mr Pasi and the five managers were suspended in May amid revelations that they corruptly imported vehicles.

It also emerged that the revenue authority was losing millions of dollars to dealers who processed counterfeit undervalued import documents to smuggle vehicles and other products into the country.

As a result, the Zimra board, chaired by Mrs Willia Bonyongwe, requested the Auditor-General’s Office to carry out a forensic audit to verify the claims. “The board was troubled when the scandal, relating to the importation of vehicles by the executive management broke out,” said Mrs Bonyongwe in a statement yesterday. “The CG (Commissioner-General) had neither disclosed it to the board, nor taken any disciplinary action against the executives involved, four months after it happened.

“Naturally, the board sought to investigate the issue and on May 6, 2016, resolved to request the Office of the Auditor-General to carry out a forensic audit to investigate this matter and other issues relating to executive packages, procurement procedures among other things. To facilitate the audit, the board placed the CG and five executive managers on leave.”

Mrs Bonyongwe said the audit firm, HLB Zimbabwe Chartered Accountants, won the tender and started their investigations on July 1, 2016. She said it was later discovered that the audit must be broken down into two parts following further revelations, which in essence changed the scope of the audit.

It was resolved that HLB Zimbabwe Chartered Accountants would proceed with the old scope while a new tender to investigate the ICT operating systems, procurement and governance structures would be floated. Mrs Bonyongwe said Deloitte and Touche was awarded the tender on July 29, 2016 with their report expected in a fortnight.

On the latest report, Mrs Bonyongwe said: “HLB Zimbabwe Chartered Accountants have submitted the same to the Auditor General. We are obliged to report that the Zimra board has now received the audit report. “The report contains various adverse observations with respect to the operations of Zimra.

“The Zimra board shall study the audit observations but some of the key observations or findings of the audit relate to the following: systematic corrupt practices, abuse of office and fraud; violations of the Zimbabwe Revenue Act, as well as the Customs and Excise Act; poor corporate governance practices and weak internal control systems; disclosure issues with regard to the Board and parent Ministry; violations of procurement procedures; and abuse of the whistle blower facility, among others.”

Mrs Bonyongwe said the board would deliberate on the audit report and come up with remedial measures in accordance with the Zimbabwe Revenue Act, Zimra Code of Conduct and the Labour laws of Zimbabwe. She said in the interest of transparency, an executive summary of the report would be availed once all the necessary procedures had been done.

Mrs Bonyongwe said while the Revenue Authority Act Chapter 23:11, Section 5(1), mandated the control of Zimra to its directors, corporate governance principles stipulated that the board was the accounting authority.

To that end, she said, the board was liable for any systematic failure of Zimra despite the fact that the day-to-day running of the revenue collector was delegated to management.

“Furthermore, the board has fiduciary and legal duties to the Zimra, but the ability of the board to discharge these duties is contingent upon the competency and cooperation of its management principally the Commissioner General (CG).

“The accuracy, timeliness and completeness of the flow of information to the board is vital to avoid any shocks, which may have considerable effects to stakeholders,” said Mrs Bonyongwe.