Illegal forex baron dumped $48 million onto the market- Reserve Bank of Zimbabwe governor says


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The people that are moving money onto the black market are not ordinary Zimbabweans but highly influential people with access to huge sums of cash, Reserve Bank of Zimbabwe governor John Mangudya said.

One character, whom he did not name, pushed $48 million in foreign currency onto the black market, Mangudya told Newsday.

He denied that the central bank was involved in any black market dealings but was instead investigating the illicit transactions.

“The people moving money onto the black market, the people behind the money changers, are not your ordinary Zimbabwean,” Mangudya said.

“These are influential people with access to huge sums of cash. It has been discovered that one character has been pushing onto the black market as much as $48 million in foreign currency.

“This person has access to cash and it is difficult to understand how this could have happened without the knowledge of the CIO, the FIU (the RBZ’s Financial Intelligence Unit), the police as well as the commercial bank.

“The meeting called by the President could trigger a nasty fall-out and there is already gnashing of teeth. Some people have a lot of explaining to do and heads will roll.”

President Emmerson Mnangagwa is reported to have called a high level meeting of the security cluster to discuss the fall of the bond note against the United States dollar that was being fuelled by the black market and resulted in the prices of basic commodities skyrocketing.

The bond note fell to 6 to one United States dollar before recovering on Thursday after assurances that the rate of the bond note against the US dollar will be guaranteed at one to one by Afreximbank which backed the surrogate currency when it was introduced in November 2016.

But the damage had already been done and will take time to repair.

Writing in the first of his weekly articles in the Sunday Mail yesterday, Mnangagwa acknowledged that the “nefarious activities” being carried out by “shadowy figures” thrived on different electronic platforms.

Mnangagwa said the problem was now being treated as a serious national security threat.

Illegal electronic foreign currency traders normally use the Old Mutual Implied Rate which is the difference between the share price of Old Mutual on the London and Harare stock exchanges.

On Friday, OMIR stood at 8.9338 which means if the tycoon who moved $48 million had done so in one transaction on Friday, he or she would have netted $428 822 400.

Mnangagwa is reported to have the list of the cash barons behind the black market. Ironically, they include one of the country’s largest banks and senior members of the ruling Zimbabwe African National Union-Patriotic Front, putting Mnangagwa in a tight spot.

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The Insider

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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