The International Consortium of Investigative Journalists has named over 280 Zimbabweans, including prominent businesspeople, who reportedly syphoned billions of dollars out of the country. The businesspeople, mostly of Caucasian extraction, have links to offshore investment vehicles.
The list is contained in data from over 200 countries that was leaked to the Panama Papers and contains information about offshore companies and the people behind them.
The Panama Papers are 11,5 million leaked documents that detail financial and attorney–client information for more than 214 488 offshore entities.
The leaked documents were created by Panamanian law firm and corporate service provider Mossack Fonseca, some dated back to the 1970s.
The latest release with information on Zimbabwe includes the names of over 200 prominent local businessmen and company executives who have been making use of the Panama law firm.
Prominent names featuring on the list include Innscor Africa directors Zinona (Zed) Koudounaris and Michael Fowler, John Legat, Kingstone Munyawarara and former Cottco chief executive Happymore Mapara.
Investigation data alleges that the two Innscor directors, like others on the list, engaged the services of lawyers and accountants to open four companies in the British Virgin Islands.
However, a representative of Messrs Koudounaris and Fowler said the offshore investments were legal and the two had done nothing criminal as they run businesses outside Zimbabwe.
“With respect to Mr Fowler, he inherited an offshore structure from his father which has continued to exist lawfully. The two have not been involved in any externalisation.”
Business tycoon and prominent property mogul Ken Sharpe is also listed in the Panama Papers’ leaked data files, while Zimplats chief executive Alex Mhembere is also part of the list.
But Mr Sharpe said he had been approached by a United Kingdom investment consultant to make a $25 000 property investment offshore.
The list also features sports personality, rally driver Conrad Rautenbach.
According to legal experts, it is not necessarily an offence or illegal to have an offshore company or bank account, but some of them have in the past been used for tax evasion and externalisation.
According to the RBZ, $1,8 billion was spirited out of Zimbabwe in 2015 alone through illicit transactions, inflated management and technical consultancy fees to foreign entities.
The hidden wealth of some of the world’s most prominent leaders, politicians and celebrities leaked through Panama Papers has between 2009 and 2015 showed an unprecedented release of millions of documents that show the many ways in which the rich have been exploiting secretive offshore tax regimes.
Although it is said that there is nothing unlawful about one being linked to offshore companies or bank accounts, the files leaked raise fundamental questions about ethical conduct in tax havens.
The data released by ICIJ through Panama Papers includes postal addresses; displays links to more than 200 countries and users can filter the information by country and by offshore jurisdiction.
The extensive data also explores the role of banks, law firms and other gatekeepers of the financial system in facilitating the creation of offshore companies for high net worth individuals.
Reserve Bank of Zimbabwe governor Dr John Mangudya, said that the issue around the operation of offshore accounts and companies depended on a particular situation at hand.
However, he said whenever money from Zimbabwe was taken outside of the country’s borders, this would be externalisation.
“It’s all about externalisation or capital flight,” he said. “The second question is it legal or illegal and if it is legal, even if one has exchange control approval, is it morally right or wrong to take money from an economy that is not doing well and to an economy that is doing well?” the RBZ governor said.
Dr Mangudya said some individuals and companies have externalised proceeds generated from Zimbabwe under the guise of free funds.
That is the reason why he said the RBZ had taken the position that there should be no more free funds except for Diaspora remittances and funds belonging to NGOs and embassies.
For instance, Dr Mangudya said, there was no justification for taking money from Zimbabwe to a foreign jurisdiction under the banner of free funds if it was generated from domestic economic activity such as artisanal gold mining or tobacco sales.
The governor said there was need to critically look at the situations where money had been spirited out of the country, which has been facing a debilitating cash crisis over the last few weeks, to determine whether this was done legally or illegally.
The ICIJ, however, said having one’s name on the list did not necessarily mean one had an offshore account.