Zimbabwean Bank Alleges Loan Defaults by 26 Public Figures
By Blessing Zulu August 8, 2019
The Zimbabwean president's son, a former first lady and 24 prominent politicians are accused of abusing their positions to acquire loans without collateral from a leading bank in the southern African country.
The Commercial Bank of Zimbabwe (CBZ) says it has been forced to assume debt totaling at least $160 million after Emmerson Mnangagwa Jr., Grace Mugabe and others defaulted on loans made from 2010 to 2014.
Zimbabwe's government, overseeing the country's worst economy in a decade, has a 16% stake in CBZ.
CBZ released a list of alleged defaulters this week. Most of those on the list also allegedly defaulted on additional loans totaling $200 million from the Reserve Bank of Zimbabwe – loans that must be covered by taxpayers.
Zimbabweans are struggling to cope with soaring prices for food, medicine and other staples as wages fall and the government cuts electricity for up to 18 hours a day to try to contain costs.
Mnangagwa, whose father replaced longtime President Robert Mugabe in late 2017, allegedly defaulted on a $400,000 loan from the commercial bank. Grace Mugabe, who led the ruling Zanu-PF party's women's wing and had indicated interest in the presidency for herself, is accused of failing to repay $4.5 million to the bank. She is in Singapore with her ailing husband and could not be reached for comment.
But the younger Mnangagwa told VOA he owes nothing to CBZ.
"I do not currently hold, or have held, an account with the Commercial Bank of Zimbabwe, nor have I ever transacted with them," he wrote in an email Thursday.
Other prominent alleged borrowers include Obert Mpofu, a former Cabinet minister in the Zanu-PF; Ignatius Chombo, another former Cabinet minister; Mabel Chinomona, former Senate president; and Job Sikhala, a member of parliament and the only opposition member on the list.
Zimbabwe's education minister, Paul Mavhima, who borrowed $120,000 from CBZ, told VOA he had reached a repayment agreement with the bank.
CBZ management has contracted with Tendai Biti, a former finance minister and vice president of the opposition Movement for Democratic Change, to recover the debts. The opposition group is led by Nelson Chamisa, runner-up to the elder Mnangagwa in last summer's presidential election.
Biti confirmed to VOA's Zimbabwe service that he would work for the bank.
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