Judgment record
THE State V Simon Mudzingwa Taranhike, Shadreck Matengabadza, Stephen Matute, Givemore Tendai KUFA, AND Precious Murove
HH 222-18HH 222-182018
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THE STATE
versus
SIMON MUDZINGWA TARANHIKE
and
SHADRECK MATENGABADZA
and
STEPHEN MATUTE
and
GIVEMORE TENDAI KUFA
and
PRECIOUS MUROVE
HIGH COURT OF ZIMBABWE
TSANGA J
HARARE, 29, 30, 21 January, 1, 2, 5, & 8 February, & 24 April 2018
Assessors 1. Mr Chidyausiku
2. Mr Msengezi
Criminal Trial
C. Mutangadura, for the State
Ms R Maposa, for 1st to 5th accused persons
TSANGA J: The five accused persons were charged with criminal abuse of duty as
public officers as defined in s 174 of the Criminal Law (Codification and Reform) Act
[Chapter 9:23]. The allegations against them were that between 3-23 May 2017, at ZINARA,
the five accused had unlawfully and in common purpose with each other, in the exercise of
their functions and contrary to their duties as public officers, engaged third party companies
to source foreign currency on the informal market on behalf of ZINARA. This was in their
capacities as Finance Director, Finance Manager, Accountant, Regional Engineer North, and
Director Administration and Human Resources of ZINARA. The companies in question
whom they were said to have sourced were Access Finance (Pvt) Ltd, Grayriver (Pvt) Ltd,
and, Caudless Trading (Pvt) Ltd. The five accused were said to have made payments
amounting to US$2 940 558.69 to these three companies as consideration towards the
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servicing of a loan owed by ZINARA to Development Bank of Southern Africa (DBSA)
without authority of ZINARA Board of Directors for the purpose of showing favour to these
three companies.
The first accused Simon Mudzingwa Taranhike is the Finance Director of ZINARA.
The second accused Shadreck Matengabadza is the Finance Manager. The third accused
Stephen Matute is the Accountant. The fourth accused Givemore Tendai Kufa is the Regional
Engineer North whilst the fifth accused, Precious Murove, is the Director Administration and
Human Resources of ZINARA. Each pleaded not guilty to the charge. Their core defence was
that the payments were not made on behalf of ZINARA but on behalf of Infralink (Pvt) Ltd
(Infralink), and that as such, ZINARA lacked locus standi in the matter. Their resultant
standpoint was that they could not have abused their duties as public officers when they were
transacting on behalf of the private company. Furthermore, they argued that in view of the
circumstances surrounding the payment of the monies in settlement of the loan, the ZINARA
Board itself through its lawyers, had since withdrawn charges. Additionally, they asserted
that that the payments made were with the full knowledge of the Chief Executive Officer
(CEO) of ZINARA at the time they were made and that in any event they had acted with the
full mandate of their principal Infralink.
They also drew attention in their defence to the letter written to the National
Prosecuting Authority by their lawyers on behalf of the ZINARA Board, prior to the
commence of the trial. The letter highlighted that the Board was never appraised of the
criminal charges against its officers. Furthermore, there was no board resolution from
ZINARA authorising anyone to institute a criminal report. It additionally highlighted that
ZINARA and Infralink are at law two separate legal entities and that ZINARA had no locus
standi. The letter equally emphasised the context under which the payments had been made
and in particular the dire contractual consequences of failure to pay. It concluded that:
“The ZINARA Board fully accepts that it is lawfully bound to assist the National Prosecution
Authority in combating corruption and criminal conduct and would not spare any effort or
resource in supporting the prosecution of a deserving case. However, the ZINARA Board’s
impartial consideration of the facts at hand has prompted the need to alert the National
Prosecuting Authority on the needless damage that may arise to the standing of ZINARA in
circumstances where in its view, no palpable wrong was done .”
The State took a different view. It proceeded on the basis of being the dominus litis,
and, that the accused persons had a case to answer.
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The background
The Government of Zimbabwe through the Ministry of Finance and the Ministry of
Transport obtained a loan from the Development Bank of Southern Africa (DBSA) in 2011
for the sum of US$206 million. This was to be used in rehabilitating the road from Plumtree
to Mutare. ZINARA which is a statutory entity involved in road maintenance, was the
Ministry of Transport’s nominee. A private company called Infralink (Pvt) Ltd was formed as
a special purpose vehicle for implementing the agreement and for receipt and remittance of
the funds for repayment purposes. ZINARA is a 70% shareholder and Group Five, a private
entity, is a 30% shareholder in Infralink. The latter nominated NMB Bank as the Bank
through which repayment of the loan was to be made. For purposes of servicing the loan,
ZINARA ring-fenced certain revenue streams and toll gate collections on the Plumtree-
Mutare road. It would collect this money for onward transmission to Infralink. In turn,
Infralink would service the loan with DBSA. This worked until foreign currency became a
challenge in Zimbabwe. Although bond notes were deposited into the account, these only
operate within Zimbabwe. ZINARA began to experience serious challenges in remitting
foreign currency to Infralink. NMB which was Infralink’s bank was unable to assist in
securing the scarce resource. The result was that Infralink soon plummeted into unstainable
repayment arrears as the debt continued to mount and mount. It was against this background
that the five accused persons are said to have used illegal means to service the debt in that
they had sought to use companies outside the country to use their own monies whilst being
reimbursed here in Zimbabwe at a premium.
THE STATE EVIDENCE
Judith Kateera who was the then Permanent Secretary in the Ministry of Finance
and a Board member of ZINARA as well as chairperson of its Finance Committee gave
evidence. According to her, at a meeting on 22 March 2017 the Finance Director, the first
accused in this matter, had brought it to the Committee’s attention that the loan obtained by
ZINARA from DBSA had accumulated arrears of US $14.5m and was attracting penalties of
200% over the 6% annual rate. At a third Finance Committee meeting was held on 12 June
2017, the arrears had accumulated to US$21m. The Finance Director reported at that meeting
that the Reserve Bank of Zimbabwe had only availed US$2.5m for purposes of repaying the
arrears. Concerns had been raised that the debt was unsustainable and would threaten the very
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existence of ZINARA. It was at this meeting that the first accused person had proposed that
permission be granted to approach those on the market who could help extinguish the debt.
As chairperson of the Committee her response had been that this would contravene the
Money Laundering Act. The resolution, according to this witness, was that the Ministry of
Transport as the parent body was to be approached for them to further engage the Ministry of
Finance and the Reserve Bank of Zimbabwe. She had subsequently learnt of the unauthorised
payment to Grayriver when the police approached her.
Albert Mugabe who was then the chairperson of the ZINARA Board told the court
that the issue of the repayment of the loan was a regular issue on the ZINARA Board agenda.
He confirmed the challenges that NMB Bank had encountered in procuring US dollars
despite the account being populated with bond notes. It was under these circumstances that
the US dollars had been obtained outside the normal bank structures and used to service the
runaway debt although the Board, which had oversight over polices, had not authorised the
sourcing of foreign currency from third parties. He agreed in cross examination that making
the payment did indeed relieve ZINARA of some of the penalties and that he would therefore
not be surprised if the executive had sought ways to reduce the burden on ZINARA. He was
not aware of any personal benefits that any of them had received.
Nancy Masiyiwa the CEO of ZINARA told the court that she had assumed office as
head of ZINARA in September of 2016. She described the core Executive team at ZINARA
as consisting of herself, the director of finance, the human resources director, the technical
director and the corporate secretary. She is the one who chairs the Executive. The Executive
reports to the board of directors. The CEO is the one who prepares the agenda for the Board
and also presents the ZINARA report from the Executive to the Board.
In terms of the actual day to day working structure between ZINARA and Infralink
she highlighted that the chairperson of the ZINARA Board is also the chairperson of the
Infralink Board and the corporate secretary for ZINARA is also the corporate secretary for
Infralink. She further explained that the CEO of ZINARA is also the CEO of the Infralink
and that the financial director for ZINARA is also the same for Infralink. Group Five,
Infralink’s counterpart has two representatives on the Infralink Board. Amongst the accused
persons, only the Finance Director sat on the Infralink Board. She also highlighted that in
reality the Infralink Board rarely met as Infralink and if they were issues to be discussed these
were discussed by way of round robin.
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Regarding the loan to DBSA which was to be paid by Infralink through funds
received from ZINARA, it would generally be discussed by the Executive within ZINARA
where the Finance Director would give an update. It would also be discussed by the ZINARA
Board. According to her testimony the Infralink board rarely met as a Board. The overlapping
board members had gone to South Africa as Infralink board members to discuss the
restructuring the loan sometime in March 2017.
She confirmed that in June the Finance Committee had indeed shot down the proposal
to pursue foreign currency on the open market. She told the court that the schedule of
payments made by the accused was only brought to her attention when the serious fraud
squad engaged her in June. Her evidence was that these payments should have been escalated
to her office. Whilst she admitted having asked the Finance Director at the beginning of that
year to engage innovative thinking in raising funds to pay the debt, she had not said
procedures should not be followed. She was unable to comment on whether the accused
persons had received any benefits.
Patrick Takawira the Treasure Director at FBC Bank who was introduced to the
second accused Shadreck Matengabadza by Mr Njanji from CBZ, which was ZINARA’s
bank also gave his evidence. Its gist was that he in turn had introduced the two to Dr
Hokonya, a business consultant who knew people who could pay in foreign currency outside
the country and had capacity to assist.
Dr Hokonya who had sourced the companies that were able to pay in rands
confirmed that he had been introduced to the second accused, who on behalf of ZINARA,
had confirmed that they were looking for people who could effect payment on their behalf
outside the country. He had also received confirmation from the second accused that DBSA
in South Africa were agreeable to payments being made in rands in South Africa. Solarwatts
had been sourced to make the payment. It needed a receiving account in Zimbabwe to receive
the payment from ZINARA. Solarwatts had indicated that the payment was to be made to a
company known as Grayriver and had provided an account for it held at CBZ. Solarwatts was
supposed to pay an equivalent of US$ 250 000 to DBSA on behalf of Infralink. This they had
purportedly done in South Africa and ZINARA, in return, paid $300 000.00 into the
Grayriver CBZ account here in Zimbabwe. According to this witness the other $50 000 was
for commission from which he was to have received $25 000.00 as introduction fees. He told
the court that he had paid his assistant Chandler Moyo whom he worked with a sum of
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US$12 500.00 but had been unable to get his US$12.500 as the account had been
subsequently been frozen soon thereafter.
Chandler Moyo’s evidence did not add much other than confirming that he did
indeed assist Dr Hokonya in relaying information to and from the various players. He also
revealed that after being paid his $12 500.00 the second accused had taken a loan of $2
500.00 from him which he had repaid.
Mr Shadreck Chezani the investigation officer was the final state witness. He told
the court that the matter had been anonymously reported to the police in May 2017.
Interviews had thereafter been carried out at ZINARA and had established that something
was not proper. A successful application to freeze the Grayriver account had been made. The
investigation unearthed that four transactions had been made from the Grayriver account
following the payment into the account of $300 000.00. Investigations had also established
that the withdrawals had been fast and furious. Besides the $12 500.00 paid to Chandler
Moyo, a person purporting to be Honest Kugotsi had also made withdrawal. They had
established that the particulars of the real Honest Kugotsi had been used and that the real
person had nothing to do with the matter. About $14 000.00 and another $60 000.00 had been
used to purchase goods using his name. Another fictitious person named Mckenzie had also
withdrawn from the account. A fourth transaction involving $40 000.00 had also been made
impersonating one of the directors of Grayriver, Magaisa Sobuza, who had in fact died in
2014.
He told the court that a total of $131 000.00 had been spirited away by the time the
account was frozen and that the remainder of the amount remains frozen in the account.
Whilst a Munyaradzi Paraiwa had stepped forward to lay claim, the police had been unable to
get hold of a person by that name at the address given. Importantly, whilst a company called
Grayriver does exist the IO explained that the account had initially been opened by one
Collins Mupimbo who had been given certain documents by Mr Bruce Michael Blake from
Grayriver in their business dealings to assist with opening an account for Grayriver at CBZ.
The account had been opened. However, Mr Blake of Grayriver had discovered some two
weeks prior that he could not use the account as he was being denied access.
The IO also told the court that all the payments purportedly made on behalf of
Infralink through ZINARA were still under investigation. In particular, they were still
investigating whether fraud and theft had been committed by any of the accused persons. The
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rationale for bringing the matter to court when investigations were still in progress was said
to be the fact that the focus of the complaint at this point was a separate one of criminal abuse
of office in that the accused persons had acted negligently without authority. He confirmed in
cross examination that the initial charges that they had filed were for theft and fraud but that
they had since changed the charge to abuse of office since they realised in the course of
investigations that the ZINARA Board had not authorised the payments.
The evidence of three other state witnesses, namely, the real Honest Kugotsi whose
particulars had been fraudulently utilised to open the account; that of Bruce Michael Blake
who had given Grayriver’s details to Collins Mupimbo to open an account at CBZ; and that
of Tonderai Marange an accountant at ZINARA who had subsequently received the
anonymous call that precipitated the investigations, was admitted in terms of s 314 of the
Criminal Procedure and Evidence Act. [Chapter 9:07].
THE DEFENCE CASE
The first accused Simon Taranhike gave evidence which was crystalline that the
reason Infralink fell into arrears in servicing its loan repayments to DBSA was because they
were unable to secure foreign currency from the Reserve Bank to repay the loan even though
they had money in the local bank, NMB. Representations to the Ministry of Transport and the
Ministry of Finance to assist in securing the necessary funds had not borne any fruits. By
March 2017, the arrears were ringing at $14m. As at December 2016, $232m had been paid
on the loan of $206m but $171m was still owed in total.
It was following this December meeting that he had received instructions from the
CEO on targets to be met the following year and on the need for innovative thinking to clear
the debt. He described to the court how the instructions in essence required him to raise $1.2
billion through stipulated tasks within a short period of time with consequences. A resolution
had been taken at the December meeting for Infralink representatives inclusive of Group Five
to go to South Africa to meet with DBSA with a view to negotiating on the loan repayments
being made on rand and then being converted into US dollars, since the loan was in US
dollars. Another possibility explored was that using $17m held in a reserve account to set off
the 14m then accumulated in arrears. A meeting had taken place in South Africa in March
2017 with DBSA. Apart from the witness, the team that went to South Africa included the
Chairperson of the ZINARA and Infralink Mr Albert Mugabe, the Deputy Chairperson Mr
Kamwi, the CEO Ms Masiyiwa and a member of the board Ms Mujokoro.
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Whilst the payment plan to use reserve funds had been rejected on the grounds that
Infralink were negotiating for restructuring with dirty hands, pleas to pay in rand had been
made. Following the meeting and a lengthy debate with DBSA a team had been tasked to put
these representations to pay in rand in writing. This had been done including the furnishing of
the payment plan. Names of those companies that would pay in rand were also provided to
DBSA. DBSA had agreed to payment being made in rands. The payments had then been
made in May 2017 through the three companies found by Dr Hokonya. A total of $2.1 m was
paid to DBSA between 3 and 23 May 2017. He also told the court that the value put on rand
payments was not to exceed 30% of the expenses paid. He attributed the different rates and
amounts paid to these payments having been effected on different dates. He also confirmed
giving the second accused explicit instructions to go to banks to get help in potentially
settling the loan from rand based accounts. He was also adamant that ZINARA had only paid
out in all cases upon receipt of confirmation that the money had indeed been received in the
DBSA account and that all payments had gone through. He denied that what he had done
amounted to procuring money from unauthorised sources or that they had procured money on
the open market since they had gone to CBZ, ZINARA’s bank, which in turn had referred
them to another Bank for assistance and subsequently to Dr Hokonya.
The second accused’s evidence, Shadreck Matengabadza, the Finance Manager with
ZINARA essentially confirmed the chain of events that in that capacity he had gone to their
relationship manager at CBZ Mr Henry Njanji who in turn had taken him to meet Patrick
Takawira at FBC Bank, who in turn had introduced him to Dr Hokonya. The latter had then
put him in touch with Chandler Moyo as his point man. It was the latter who had advised him
that he had found a company in South Africa that could effect payments in rand. It was also
Chandler Moyo who had provided the details for Grayriver and informed him that Solarwatts
in South Africa which had effected payments in rands had said their money should be
received by Grayriver.
He told the court that the schedule of rand payments that was before the court was not
correct and had been tampered with by its compilers with altered figures as to what was paid
out in order to fix him. He opined that it was because of the discovery of the manipulations
and flaws such as these that the Board had in fact attempted to have withdrawn the charges
the accused persons were facing. He too denied illegality in the dealings, emphasising that
they were authorised to do so and were in fact paying expenses. He told the court that with
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the benefit of hindsight, he now realised that the CEO had deliberately never wanted to sign
anything from the finance department always referring back to it anything that required
action.
The third accused, Steven Mature, an accountant in ZINARA who reports to the
Finance Manager, described his duties as being to receive payment instructions and then
passing these on to clerks to raise payment vouchers, send or effect RTGs. He told the court
that the payments made were fully authorised and relied on the CEO’s letter of 9 January
2017 instructing the Finance Director to look at other ways of ensuring that the debt was
paid; and the evidence of Infralink’s Board minutes on the payment plan to DBSA.
The fourth accused Tendai Kufa an engineer within ZINARA was said to have
counter signed instructions to the bank to effect payment to the companies in the schedule
that was placed before his court. He explained that sometime from the 22-23 May 2017, the
first accused had been acting CEO as the CEO was away. He himself was acting Director -
Technical on behalf of the Director who was away. He had been invited to do signoffs of all
payments that had been done that day. The Grayriver payment was amongst them and against
it was indicated DBSA loan repayment. He had asked about it as he had never come across
the name and was advised that they were being paid in line with developments that had taken
place in Infralink regarding payments to Infralink. He was also told that the Finance
Department had been advised and was aware. As he was talking to the Acting CEO, he took
his word for it that all was above board. There was a supporting voucher from Finance and all
protocols had been observed. He had therefore signed.
The fifth accused Precious Murove described his duties as the Director for
Administration and Human Resources Management within ZINARA. He is also responsible
among other things for signing off all ZINARA and Infralink payments as a “B” signatory.
He is however not a board member and does not attend Infralink meetings. His role is to only
sign off as additional signatory. His evidence was that the first accused was indeed authorised
to look for local and individual partners to facilitate payment to DBSA. He told the court that
the DBSA loan was discussed at three levels namely the ZINARA Board, the Finance
Committee and the Executive Committee. He confirmed from internal correspondence
(Exhibit D6) that the issue that ZINARA was supplementing NMB funds by making
payments in rands was fully known.
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He explained in cross examination that the loan’s importance to ZINARA in
executive meetings arose from it having ceded revenue from three streams, namely transit
fees, tolling fees and abnormal load fees for a period of ten years. As such, ZINARA had a
direct interest in the repayment of the loan because it could not cede its revenue streams
indefinitely since it would be prejudiced by doing so. That being said, his standpoint was still
that Infralink is a private entity and that it was Infralink that was getting the revenue streams
from the ceded entities in order to pay DBSA. As such, the issue of the DBSA loan was
according to him essentially an Infralink issue.
THE LAW
Public abuse of office impacts on the public’s trust and confidence in public
institutions. It can also have financial consequences. As one author, John Hatchard puts it:
“(T)he offence is essentially a support for integrity and good governance on the basis that
those who are entrusted with state power must act for the public good. Whilst many of the
reported cases involve police officers, the offence applies generally to officials in the public
service, local government and, arguably those in the private sector providing public
functions"
It has also been explained thus:
“The essence of the crime of misconduct of public office is either wilfully neglecting to carry
out the public duty entrusted to you, or wilfully abusing it for some improper end .”
The offence of criminal abuse of duty as a public officer is clearly defined in our
code. The provision is described as re-enacting and expanding upon the previous s 4 of the
Prevention of Corruption Act.1 Historically neglect of duty, bribery and extortion were at the
core of abuse of public office.2 Furthermore, crimes such as bribery, extortion, theft and fraud
which may also speak factually to various situations that involve public officers are separate
offences in the code. Criminal abuse of duty as a public officer is defined as follows.
“174 Criminal abuse of duty as public officer
(1) If a public officer, in the exercise of his or her functions as such, intentionally
(a) does anything that is contrary to or inconsistent with his or her duty as a public officer; or
(b) omits to do anything which it is his or her duty as a public officer to do;
1
See G Feltoe Commentary on the Criminal Law (Codification and Reform) Act [Chapter 9:23]
November 2017
2
Hawkins Pleas of the Crown 1716-121 and 1824 as discussed by Graham McBain, in his article Modernising
the Common Law Offence of Misconduct in a Public or Judicial Office, 7 J. Pol. & L. 46 (2014).
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for the purpose of showing favour or disfavour to any person, he or she shall be guilty of
criminal abuse of duty as a public officer and liable to a fine not exceeding level thirteen or
imprisonment for period not exceeding fifteen years or both.
(2) If it is proved, in any prosecution for criminal abuse of duty as a public officer, that a
public officer, in breach of his or her duty as such, did or omitted to do anything to the favour
or prejudice of any person, it shall be presumed, unless the contrary is proved, that he or she
did or omitted to do the thing for the purpose of showing favour or disfavour, as the case may
be, to that person.”
To be guilty of abuse of public office what can be gleaned from the above is that:
One must be a public officer
Must have engaged in conduct that is inconsistent with duty as public officer
Must act intentionally in the act of omission or commission
The purpose of the conduct must be to show favour to disfavour to any one person
The definition of public officer as captured in our Code is as follows:
“public officer” means
(a) a Vice-President, Minister or Deputy Minister; or
(b) a governor appointed in terms of an Act referred to in section 111A of the Constitution; or
(c) a member of a council, board, committee or other authority which is a statutory body or
local authority or which is responsible for administering the affairs or business of a statutory
body or
local authority; or
(d) a person holding or acting in a paid office in the service of the State, a statutory body
or a local authority; or
(e) a judicial officer.”
LEGAL AND FACTUAL ANALYSIS
The issues for decision essentially whittle down to two: firstly whether under the
described factual circumstances the accused persons were acting as public officers, and,
secondly whether they abused public office in their conduct in order show favour to the
companies in question.
Whilst the Criminal Code is always the starting point in resolving any disputes where
an area of law has been codified, however, as has been pointed out by Feltoe in his
commentary on the Code, codification has not obviated the need for judicial interpretation. 3
Additionally, to avoid judicial lag and as a matter of persuasive comparative analysis rather
than binding authority, we do well in an increasingly shrinking world to also understand how
other jurisdictions have approached and interpreted the concept of abuse of public office.
3
Geoff Feltoe above
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Whether the accused were acting as public officers
The thrust of the argument proffered by the accused persons as highlighted is that the
debt was an Infralink debt, which is private company. That Infralink is a private company set
up as a special purpose vehicle by ZINARA and Group Five for purposes of carrying out
public functions is not in dispute. It is equally not in dispute that all five accused persons
were employed by ZINARA a statutory entity and that only the Finance Director among the
accused had an overlapping function in Infralink.
The fact that the government is the major shareholder of an entity has been opined not
to colour in any manner whatsoever its nature as a private entity where it is registered. Its
employees are said to be not public officers. As observed in the case of S v Chikumba 2015
(2) ZLR 382 (H) at p 391B, with reference to s 169 of the Code as to who is a public officer,
the court observed thus:
“The section does not refer to government-controlled entities. It refers to persons holding
office in the service of the State. To say the Chief Executive Officer of Air Zimbabwe
Holdings, a private company, is the same thing as “a paid office in the service of the State” is
absurd. The government is merely a shareholder in the airline. It is not the employer. In my
view, the person referred to in that section is a civil servant who is employed directly by the
State and paid directly by it”.
And further, at p 391C
“It is true that the State may sometimes run its affairs indirectly through statutory
corporations. But the definition of “public officer” caters for that. Section 169 defines a
“statutory body” to mean, among other things, “… anybody corporate established directly by
or under an Act for special purposes specified in that Act”.
In this instance, the facts are very distinguishable from the above case in terms of
what actually pertained on the ground in terms of the practical day to day link between
ZINARA and Infralink. In Exhibit D4 which was placed before this court by accused
persons’ counsel, an Infralink document compiled for the Minister of Finance and dated 24
February 2017, Infralink is described as a company under the management of ZINARA. In
actual practice, ZINARA had an almost indistinguishable interest in running the affairs of
Infralink whose business was no doubt of a public nature albeit it was a privately registered
entity. What is significant in this case is that whilst indeed Infralink is a private corporation
its management and administration was entirely in the hands of ZINARA employees because
it was simply a special purpose vehicle set up for the management of a joint project between
Government and an implementing partner. There was strictly speaking no separate staff
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running the affairs of Infralink. The Finance Director at all times wore two hats as Finance
Director of ZINARA and as Finance Director of Infralink. The CEO herself was clear about
the crucial day to day overlaps within ZINARA and Infralink. Crucially Infralink’s functions
were undeniably of public nature. It matters not that the fulfilment of the mandate was
through a private company.
In the English case of R v Cosford, Falloon and Flynn [2013] 2 Cr App R 8 for
example the court concluded that the important point is:
“whether that duty is a public duty in the sense that it represents the fulfilment of one of the
responsibilities of government such that the public at large have a significant interest in its
proper discharge”.
In that case it was held that nurses in a prison setting, whether trained as prison
officers or not, and whether or not the prison is run directly by the State or indirectly
through a private company, paid by the State to perform its functions, had duties which
fulfilled the requirement of a public office for this purpose. 4
In this instance, even if the debt legally belonged to Infralink which is a private
corporation, when the facts as described herein are looked at in their entirety, it is hard to see
how ZINARA can be said to be out of the picture or to be divorced from any actions taken by
the accused in their capacity as public officers on behalf of Infralink.
However, the mere fact of being a public officer does not on its own automatically
make one liable. In the Hong Kong case of HKSAR v Wong Lin Kay [2012] 2 HKLRD 898,
for example, the Hong Kong Court of Final Appeal in deciding whether a public officer
should be liable under the facts of a particular case held that:
“The correct approach is not to attempt somehow to decide in the abstract or in isolation
whether a person is or is not a public officer. One must examine what if any powers have
been entrusted to the defendant in his official position for the public benefit, asking how if at
all, the misconduct involves an abuse of those powers …. If the defendant occupies a position
which confers no such powers on him, he is not a candidate for prosecution for the offence
even if he is employed by a local department or by an analogous public body .”
It was stated in that case that whilst in every day speech every employee of public
sector may be termed a public officer that does not necessarily mean that all public sector
employees are potentially liable for misconduct in public office. A person may be a public
sector employee and yet his job may not vest him with any relevant powers or discretions that
4
See a discussion of the case by Graham McBain, Modernising the Common Law Offence of Misconduct in a
Public or Judicial Office, 7 J. Pol. & L. 46 (2014) at page 69
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are exercisable for the benefit of the public. Furthermore, the misconduct may not involve
any abuse or have any relevance to the position he occupies.
In casu the duties entrusted upon the Finance Director were essentially of a public
nature whether within ZINARA or Infralink itself which was carrying out public functions.
He in turn delegated certain functions to some of the co accused as public officers, who all
the while performed duties for ZINARA as the public authority managing Infralink’s day to
day affairs. Simply put, the accused persons were public officers carrying out public
functions on behalf of Infralink whose functions were themselves of a public nature.
Having thus observed, this court is of the view that the more crucial question
therefore on which energy should be expended is whether the accused persons abused their
offices as public officers by acting inconsistently to show favour to the companies in
question.
Was there abuse of office?
What emerges from the definition from the definition in s174 as to what constitutes
abuse of office is the use of the word “intentionally” in carrying out the act an eschewed act
of omission or commission. This means that the conduct constituting abuse must be
deliberate, calculated or purposeful. Furthermore, the word abuse itself connotes misuse,
exploitation, taking advantage and recklessness in the conduct. The 1979 English case of R v
Dytham 1979 (2) QB 722 gives an indication of what is required in terms of arriving at an
informed conclusion that there was abuse of or neglect of public office. As the court stated
therein:
“The neglect must be wilful and not merely inadvertent; and it must be culpable in the sense
that it is without reasonable excuse or justification.”
As further stated therein, the misconduct impugned must be calculated to injure the
public interest so as to call for condemnation and punishment.
Also in the Australian case of Northern Territory Australia v Mengel (1995) CLR 307
as yet another example, it was held that:
“It is the absence of an honest attempt to perform the functions of the public office that
constitutes abuse of office. Misfeasance in public office consists of a purported exercise of
some power or authority by a pubic officer otherwise than in an honest attempt to perform
functions of his or her office whereby loss is caused to the plaintiff. Malice, knowledge and
reckless indifference are the states of mind that stamp on a purported but invalid exercise of
the power the character of abuse or misfeasance in public office. If the impugned conduct
then causes injury, the cause of action is complete .”
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In the English case of AG Reference No.3 [2005] QB 73which turned on
characterisation of misconduct and the necessary mens rea it was decided that;
“whether the misconduct was of a sufficiently serious nature would depend on the
responsibilities of the office and the office holder, the importance of the public objects which
they served, the nature and extent of the departure from those responsibilities and the
seriousness of the consequences which might follow from the misconduct ”.
When the factual circumstances in casu are examined under which outside companies
had been sought to make payments on behalf of Infralink in South Africa, there is clearly no
evidence that the accused had intentionally misconducted themselves in their duties in order
to deliberately prejudice the public. There is every indication that they had done all that was
possible to source the currency from the Reserve Bank of Zimbabwe. Neither can it be said
that the evidence showed that they acted with the sole purpose of showing favour or
disfavour to the various companies as the reason behind their actions. Granted, as the state
pointed out, the amounts paid out varied and lacked consistency and did not always constitute
no more than 30% of the expenses which was said to have been the agreed threshold for
repayment. However, the second accused challenged the accuracy of the schedule. In the
absence of any direct evidence of corruption having been placed before this court or other ill
motivation, this court concludes that the primary motivation throughout in making the
payments for the currency sourced was simply to stem arrears that were spiralling out of
hand. The hazards of borrowing without repaying were generating an unsustainable debt
which was not in the public’s interests.
Illegal conduct is of course as a matter of principle and of law not justified. The state
points out that in terms of the s 5 (1) (a) (i) of the Exchange Control Act [ Chapter 22:05] as
read with Exchange Control Regulations SI 109/96, it is a criminal act to make payments
outside Zimbabwe without exchange control authority. It is equally true that respect for the
rule of law is vital as amply recognised as such by our courts in various cases. See for
instance the discussion in Commissioner of Police v Commercial Farmers Union 2000 (1)
503 (H) at p 525-526; Mangwiro v Chombo HH 710/16. At the same time the concept is
certainly not a rigid non contextual concept that automatically lends itself to observance. In
reality the rule of law is:
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“a qualified and variable thing depending for its effectiveness on many social, legal and
political forces and agencies being in sync…..Whatever the case with necessity, however, the
mere existence and use of law are themselves not sufficient for the rule of law .”5
Furthermore:
“(T)he rule of law is so complex an achievement, dependent on so many factors in so many
domains that it is peculiarly miscast by lawyers’ often solipsistic understandings and
renditions”.6
The point of these observations in the context of this case is this: The conduct of
purchasing or sourcing foreign currency in Zimbabwe outside legal means more often than
not stems out of critical need as opposed to a wanton desire to flout the law. It is common
knowledge that observance of the rule of law through laws that have sought to prevent, curb
and restrain foreign currency violations have had less than a sterling record of success in
terms of adherence to these laws by the general populace. The law has largely been
impossible to perform as economic and social realities on the ground have necessitated the
sourcing of currency from other channels by businesses in particular just to stay afloat,
largely because the Government itself has failed to provide the currency officially. This case
should therefore not be looked oblivious of the economic challenges on the ground that face
not only companies and other businesses but all entities and individuals across the spectrum
of society in our country in obtaining foreign currency.
In the case of Telecel Zimbabwe (Pvt) Ltd v The State 2006 (1) 467 (H), a criminal
appeal before the High Court from the Magistrate’s court, the appellant had been found guilty
of 60 counts of purchasing foreign currency from unauthorised dealers at parallel market
rates without Exchange Control authority. A mandatory minimum fine had been imposed by
the magistrate of no less than the foreign currency involved. As in the present case, Telecel
had experienced major difficulties in accessing foreign currency from its bankers to pay off
its international contractual loan as well as to meet its principal obligations. It had carried out
a raft of measures to mitigate the impact of the shortage of foreign currency, endemic in the
official market, on its operations but to no avail. The foreign currency had been purchased
outside Zimbabwe.
Albeit still levying a lesser fine for the offence, the court recognised the special
circumstances involved as follows:
5
Martin Krygier Rule of law in Rosenfeld M & Sajo A (eds) The Oxford Handbook of Comparative
Constitutionalism (Oxford: Oxford University Press 2012) at p 234
6
Above at p249
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“The operating economic environment, the use to which the foreign currency that was
purchased was put to and the motive(s) that drove the appellant to the parallel market
cumulatively show the existence of abnormal, unusual, peculiar and extraordinary
circumstances which drove the appellant to break the law. For it, it was clearly a matter of life
and death. It was necessary for its survival to purchase foreign currency from unauthorised
dealers without Exchange Control authority at parallel market rates. All these constitute
'special reasons’.”
See also Echodelta Limited v Kerr and Downey Safaris 2002 (1) ZLR 632 ( H);
Meristem Investments (Pvt) Ltd, t/a as Micromat v NMB Bank Ltd HH 211/02; Stuart
Annadale v Material Finance (Pvt) Ltd HH 213/2002 in which challenges pertaining to the
obtainment of foreign currency were focal issues.
Since intention to abuse is key, it is hard to see how in seeking to make payments that
would reduce the debt, the five accused persons in common purpose can be said to have
intentionally abused their office more so when they clearly did everything in their power to
obtain sufficient money from the Reserve Bank to keep up with payments without success.
The accused persons are said to have criminally abused office by acting without
Board authority in particular in making payment through third parties outside the country
whom they paid here in Zimbabwe. The purpose of the visit to South Africa to meet as an
Infralink Board, it must be recalled, was to look at the possibility of using reserve funds
within NMB, and, alternatively the option of making payments in rand, which was
subsequently approved and followed through. It is therefore not at all true that the entire
Board of ZINARA was oblivious of the arrangement and subsequent payments in rand if
consideration is had to the team that went to South Africa and the overlapping and
representative roles within ZINARA and Infralink of the persons on that team. In particular
were the Chairperson of the Board at the time Mr Albert Mugabe and the CEO Ms Masiyiwa.
As such, the Board chairperson himself was aware of the arrangement as would have been
those board members who had gone to South Africa. It would therefore be ludicrous in the
extreme to hold that officers who later carried out a mandate in good faith, some like accused
number five whose role was merely to sign documents as an alternative signatory in the
absence of someone else, should be the ones to face the music. The then Chairperson and the
CEO who were part and parcel of putting in motion the arrangement cannot now pretend to
look on as seemingly horrified individuals who knew nothing about the subsequent payments.
That is the hallmark of dishonest leadership.
We are in no doubt that they acted with the full knowledge of their CEO whose
responsibility it was to bring the issue to the full Board. From her own evidence- in- chief,
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the responsibility for the Board agenda was hers. We were satisfied that the Finance Director
did report to the CEO both in her capacity as CEO of ZINARA and her concomitant position
in Infralink about the payments that were ultimately made which she knew about. She herself
as observed had attended meetings in South Africa and in addition, schedules of which
companies would pay on behalf of Infralink had later been sent to DBSA. It was a simple lie
that she was not aware of what was happening. By the time the Finance Committee met to
turn down the proposal that outside funds be sourced from the market, she was fully aware
that payments had already been made in rands way back in May. The CEO was far from
being an impressive and honest witness. Her primary motivation in the manner she gave her
evidence was to ensure that nothing stuck to her as the responsible person yet as the CEO the
bucks stops with her. There is no basis upon which the accused persons should be held to be
the ones responsible when what they did was with the full blessings of their ultimate superior
under the surrounding circumstances where they were acting in good faith. Targeting juniors
as scapegoats in an alleged fight against corruption lends itself to selective justice and cannot
be countenanced.
Moreover, the accused persons are said to have also acted negligently in that their
actions resulted in some loss as payments were made to fraudsters. No evidence was placed
by the State before this court to support the assertions that they knew they were dealing with
fraudsters or that they benefitted personally from the payments made. They had not acted
negligently as the facts suggest that they had attempted to source third parties through a
traceable channel who came to court to give his evidence. Competent verdicts to a charge
under s 174 are bribery, theft, and extortion. There was no evidence placed before this court
that they acted corruptly or that their conduct amounted to theft which they could have been
charged with if that had been the case. In fact, the Investigation Officer told the court that the
Police were still investigating. That in itself appeared to the court somewhat clumsy to bring
a case for trial amidst investigations. From the evidence placed before the court, there is no
doubt the primary motivation in making the payments was to reduce the loan in the public
interest as agreed to by their immediate superiors. Whilst payments were outside the law, the
accused persons as public officer had not abused their office as per legal definition from the
evidence availed in the course of the trial.
In view of the fact that the accused acted with the CEO’s authority whose
responsibility it ultimately was to appraise the Board, and, in view of the fact that there was
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no evidence that the accused persons had deliberately acted to show favour or disfavour to
any one person, the court reaches the following verdict.
All five accused persons are found not guilty of abuse of public office in terms of s
174 of the Criminal Code and are acquitted.
National Prosecuting Authority, State’s Legal Practitioners
Maphosa & Ndomene Legal Practitioners, Accused Persons’ Legal Practitioners