EVERY man to his trade. Truly, some people are suited to one sort of thing while others are inclined to other sorts of things. We are all different in many ways, with varying interests and abilities.
While many people must sweat blood for so little in return in their daily grind, some ingenious – or is it disingenuous – hustlers find easy ways to make money.
One such person is Harare “entrepreneur” Evans Kujinga, who has made millions through whistle-blowing which he has now perfected into an art form.
According to a Zimbabwe Revenue Authority (Zimra) audit obtained by The NewsHawks, Kujinga has reported over 80 cases to the tax collector in the past few years and in the process guaranteed himself a cool US$15 million – a lifetime fortune for many.
In fact, not many people in their working lives earn and save that much. But for Kujinga whistle-blowing and earning huge sums is as easy as a blackbird’s whistle. Through this, he has already been paid US$1 million.
Kujinga, a prolific whistle-blower, was an informant in more than 80 cases, with much of the information obtained from inside Zimra to support his cases, the Zimra audit says. This is where corruption comes in.
Whistle-blowing is not illegal, but how Zimra officials and Kujinga are doing it is what is corrupt.
Under the whistle-blower facility, Zimra is supposed to reward legitimate informants on cases relating to tax evasion under Section 34B of the Revenue Authority Act (Chapter 23:11) as read with Statutory Instrument 150 of 2020.
Statutory Instrument 150 of 2020, gazetted on 26 June 2020, regulates the payment of rewards (cash) to informants upon whistleblowing and recovery of revenue.
The reward is 10% of the amount recovered on the basis of information supplied. But corrupt Zimra officials always manipulate that; they provide whistle-blowers with information and then act on it to get money for themselves and their partners in crime.
While Zimra also undertakes to protect the identity of informants at all times as provided for in the secrecy provisions of the Revenue Authority Act, it has sometimes failed to do so.
Following The NewsHawks’ recent reports, Zimra sources have provided further details, including an audit report dating back five years, which shows a frenzy of looting of public funds under the whistle-blower facility.
At the time of the audit which exposed the rot, Kujinga had been paid over US$1 million and stood to pocket a mouthwatering US$15 million when all collections due had been made.
Despite the audit, corruption has continued unabated.
Kujinga is also prepared to fight for the loot when money does not flow in properly. In 2018, he took Zimra to court demanding US$1.8 million from a NetOne whistle-blowing deal.
In court papers, Kujinga said he was paid only US$75 000 instead of US$1.8 million due to him after he exposed NetOne over tax issues.
Former Zimra commissioner-general Faith Mazani, Zimra itself and Finance minister Mthuli Ncube were cited as first, second and third respondents respectively.
Kujinga said sometime in early November 2015 he approached and furnished Mazani and Zimra with information in terms of section 34B of the Revenue Authority Act.
“The plaintiff presented information and evidence that NetOne Cellular Private Limited was flouting its tax obligation by not paying what is lawfully due to the first defendant being (a) non-resident tax on fees (US$7 578 004), (b) value added tax ($220 183), (c) withholding tax on contracts (US$158 590), (d) income tax (8 310 103), (e) special excise due on airtime (US$2 646 770),” the court papers revealed.
Kujinga provided an internal audit report to back his case.
An agreement was subsequently signed between Zimra and him. On the basis of the audits and other documents he provided, Zimra recovered US$18 913 644, which entitled him to 10% of that, or about US$1.9 million.
However, Zimra paid him only US$75 000. This forced him to go to court.
During the Zimra audit, interactions between auditors and Zimra officials were revealing.
“Debt Management: This stage was very vital as Zimra officers would view client accounts and provide information about the tax status of each client to Kujinga such as which tax heads the client was not complying on.
“The same debt management officers would also quicken the payments collection for clients reported by Kujinga through constant follow up. The same officers would also provide information on which client had paid and how much. This information was crucial for following up with the commissioner. This was also evidenced by the specific information Kujinga would use when doing the follow-ups, for instance knowing when Liquid Telecoms had paid US$150 000.00 to Zimra,” the audit report says.
“Internal audit interviewed the officers involved as follows: Munashe Bozhiwa – he said he knew Kujinga since 2014 as a tax consultant who frequently visited Zimra offices and also agreed that he had been receiving some monies from him both as physical cash and through Ecocash over a long period of time.
“Evelyn Musora — she worked in debt management section. She said she had known Kujinga since 2007, and was a family friend. She joined Zimra in 2014 and met Kujinga at Kurima House where he said he was doing some tax consultancy work. Since then they have been discussing various tax issues. They exchanged various amounts of money over the period through Ecocash, cash and bank transfers.
“Brian Gombera — Since 2012 he was deployed at the debt management section. His duties included monitoring client accounts and advising them to update their records accordingly. He knew Evans Kujinga since 2004. He met him later at Kurima House in his capacity as a tax consultant and would assist him but could not remember the names of the clients he represented. As a friend they would borrow and lend various amounts of money to each other.
“Simbarashe Katiyo – He got to know Kujinga since 2007. After joining Zimra in 2011, he met Kujinga sometime in 2014 and assisted him as a tax consultant who would ask almost everything about Zimra, Customs and Taxation such as how to apply for a tax clearance, how to propose a payment plan, garnish orders, tax amnesty, and upliftment among other things. He did not verify whether Kujinga was a registered tax consultant or not and could not remember the specific clients Kujinga represented but was very inquisitive about how things were done in the Debt Management section. He also received monies from him through Ecocash and cash.”
Kujinga’s 80 cases
There are over 80 cases reported by Kujinga, making him the country’s leading whistle-blower.
The amount set to be paid to him was over US$15m, at various stages of processing. At one time Zimra anticipated collecting US$176 251 404.47 and paying to whistle-blowers US$16 725 140.45. Kujinga would make a killing overnight.
“The Zimra commissioner investigation played an important role through ensuring constant follow-up to ensure that cases submitted by Kujinga were quickly audited, processed and paid. Evidence on the file clearly showed that Kujinga’s cases received excessive attention from the commissioner through constant follow -ups,” the audit report says.
“Internal audit recommends that since this information was obtained internally and unprocedurally, any further payments to the whistle-blowers should be stopped. Recovery processes should be instituted to recover all the monies paid to the whistle-blower(s). The respective whistle-blower should be blacklisted from submitting any further cases. Further investigations should be carried out.”
Disciplinary action should also be instituted against Zimra officers involved in providing tax information to outsiders for corrupt financial benefit.”
This series of cases of corruption happened during former Zimra commissioner-general Gershem Pasi’s time, continued during Mazani’s time and is still happening now under acting boss Rameck Masaire.
Documents obtained by The NewsHawks from Zimra, which claims its values include “integrity, transparency and fairness”, show that top officials in the tax collection agency are at the forefront of illegally and criminally collaborating with corrupt tax evaders for financial benefit without regard for the safety of whistle-blowers.
The internal audit reveals that “there were no laid down procedures in the administration of the whistle-blower facility resulting in gross abuse”.
“The findings indicate that in some cases client bills were being reduced without basis, resulting in loss of revenue. In another case, Kujinga was paid more than what was due to him. The audit reveals a case which was reported to Zimra twice by two different informants using the names Diamond Mining Corporation and on the second instance just DMC. Pay-outs were made in both instances.
“A whistle-blower case was not accepted for investigation after it was reported by the commissioner-general and commissioner investigations to be under an audit which never took place. Resultant potential revenue was in the region of US$15 million,” the audit reveals.
“There were cases where whistle-blowers were overly frustrated by some kind of red tape in Zimra. Issues of whistle-blower frustration: failure to investigate reported rampant transfer pricing; allocating a high-pro-file whistle-blower case to Loss Control who did not have the requisite skill…One case was denied the whistle-blower status but was later allocated to loss control and the resulting audit yielded 1 500 times less than the expected yield from a full-scale audit.”
The audit also says Zimra is not consistent in the way the 10% reward to whistle-blowers is paid.
“In some instances, payment was based on the collections from the revenue head that is identified by the whistle-blower to be prejudiced. In other instances, payment to whistle-blower was based on total prejudice regardless of whether whistle-blower had identified that revenue head on his report,” it says.
Insider information
Internal auditors interviewed several Zimra employees in the debt management office, including Bozhiwa, Musorah, Gombera and Katiyo who worked with Kujinga.
They all confessed receiving money from him on several occasions. Some of the companies the network dealt with included cases involving prominent companies such as Mbada Diamonds, ZTE Corporation, Afdis, Zimbabwe Sugar Sales, Gecko Private Limited, AE Electrical Lighting, PTY Holdings, Zimbabwe Energy Regulatory Authority, Mashwede Holdings, Cargo Carriers and Postal and Telecommunications Regulatory Authority of Zimbabwe, among many others.
Potraz scandal
The audit reveals that in 2013, Zimra’s commissioner in charge of investigations Anna Mutombodzi rejected information provided by a whistle-blower “because the information was insufficient but the submitted documents were retained by the commissioner”.
“The whistle-blowers, however, later learnt that the same case was given to Kujinga to cash in with Zimra officials.
“Internal audit investigations reveal that the case was reported on 21 July 2013 and audited and has since been fully paid. A total prejudice of US$455 404.47 was established and US$45 540.47 was paid to Kujinga,” it says.
The DMC case
The case, according to the audit, was whistle-blown twice, at first using the name Diamond Mining Corporation (DMC) and on the second occasion just as DMC. The first case was reported on 12 August 2011 under case number 01/09/12/2011.
The case was audited and US$255 162.04 was established to be owing and was recovered. An amount of US$25 552.20 was paid to the whistle-blower on 19 November 2012. On the second occasion, the case was reported under DMC P/L and case number 01/10/10/2013.
This was for the same Pay-As-You-Earn tax-head. The whistle-blower was also paid.
Wrong payment
The audit reveals that Pasi authorised a payment of US$55 909.87 on 10 September 2012 to a whistle-blower against the advice of the commissioner for investigations after Raffles Fashions was reported as tax non-compliant.
“The client was audited and a final audit report was produced on 14 June 2011. A total bill of US$554 576.86 prejudice was raised for Raffles,” the audit says.
“On 13 July 2011 when Raffles had started making payments towards settlement of the bill with US$215 863.41 having been paid, an individual appeared and claimed that he was the whistle-blower. He was paid even if he could not prove that he provided the information.”
Swept under the carpet
The audit also found that some of the cases that were reported by whistle-blowers were never investigated. — STAFF WRITER.
