By Nomalanga Moyo
SW Radio Africa
03 March 2014
Top officials at Zim Cricket have been accused of mismanaging $6 million obtained from the International Cricket Council, by investing it in a bank on whose board they sit.
The money was part of a $9 million loan received from the International Cricket Council and was meant to service the local sports body’s debt with local banks.
According to sports news source ESPNcricinfo, a key condition of the loan was that Zim Cricket would use the funds to pay off its existing debt.
But Zim Cricket chairman Peter Chingoka, his deputy Wilson Manase and former managing director Ozias Bvute, ignored this condition and proceeded to invest $6 million in a non-interest bearing account at Metbank.
Manase and Chingoka are board members at Metbank while Bvute is a major shareholder at the financial institution.
The Zim Cricket debt to Metbank, facilitated by the trio, is said to be around $16 million which the sports body has been repaying at a killer interest rate of +20%.
ESPNcricinfo calculations suggest that if the cricket body had invested the $6 million in an interest-bearing account, they would have earned around $300,000 which would have gone towards servicing their Metbank loan.
“In December 2011, after learning of Zim Cricket’s high-interest loans from Metbank, the ICC loaned the cricket board $6 million with one rider: the money should be used to immediately retire ZC’s existing debt. Instead ZC deposited the money in a non-interest-bearing account with Metbank for more than five months.
“Metbank would have benefited from the interest accruing on their high-interest loan to ZC, as well as from having ZC’s money in the non-interest-bearing account available to loan to third parties. ZC would, by the same deal, have lost out twice,” the ESPNcricinfo report further stated.
Zim Cricket boss Chingoka has denied any wrongdoing, and says allegations of irregularities regarding the Metbank investment are “wrong and malicious.
He said if they had serviced the Metbank debt as per ICC loan conditions, Zim Cricket wouldn’t have been able to borrow due to the prevailing liquidity situation prevailing in the country at the time.
However, observers within the cricket community insist that the irregularities surrounding the Metbank loans plunged Zim Cricket into a deeper financial crisis.
“The knock-on effect of those decisions was that ZC’s debt spiral continued, to the extent that the board had to seek a second ICC loan last month, worth $3 million, so that it could pay contracted players, umpires, scorers and other employees,” sports website ESPNcricinfo wrote.
The latest loan requires Zim Cricket to move its accounts from Metbank. Reports suggest that the international cricket body will also pay off Zim Cricket’s debt to Metbank – effectively rescuing the troubled bank which has been experiencing serious financial problems.
ICC will deduct the money from the annual benefits due to Zim Cricket.Part of the $3 million has been used to pay players who were threatening to boycott the ICC World Twenty20 competition being held in Bangladesh this month.
This was just one of many salary protests by players who sometimes go for months without payment as a result of financial mismanagement at Zim Cricket.
The Zimbabwe Professional Cricketers Association told SW Radio Africa that the players had called off the boycott after they were paid their outstanding wages.
“We are negotiating for 25% of all ICC revenues to secure players’ salaries going forward to prevent these problems which are caused by Zim Cricket’s failure to honour its obligations,” said Eliah Zvimba, the association’s secretary-general.
The cricket board is set to receive almost $9 million from the ICC for participating in the tournament, and the players want at least $2 million of this to go into a “players’ pool”, managed by their association to avoid future payment disputes.
“Now that we know what their financial model is, we are offering to handle the players’ wages aspect of their responsibilities for them.
“We don’t see Zim Cricket refusing because so far facts and figures show that they have failed to do their job and that is why we are stepping in,” Zvimba added.
Metbank executive Bvute resigned from Zim Cricket in 2012 under unclear circumstances. He has been fingered in the unravelling scandal in which national carrier AirZim was looted of millions of dollars in dodgy deals.
Last year, Bvute was also accused of conniving with Croco Motors to import cars from Japan under the cover that they belonged to Zim Cricket, so as to not pay duty, and selling them off for a huge profit.