Econet Wireless has paid out an undocumented cash lump-sum of $39.9Million to TN Holdings (now Lifestyle Holdings) boss and CEO Tawanda Nyambirai for securing its licence renewal and facilitating debt recovery from TelOne, a local weekly reports declaring.
The deal, the report reveals how the company evaded accounting and auditing procedures by shoving out the undeclared cash to the businessman.
The report comes short in the heels of Econet being involved in a dirty cover up stunt in which it raided the Reuters-affiliated news agency, The Source. When contacted for comment on the $39.9Million scandal by The Independent, Econet claimed the explosive investigation was sub-judice as they attempted albeit unsuccessfully to hide behind their damned raid on journalists in which they arm twisted High Court Judge Joseph Musakwa.
 
Below is the full report by the Independent:
TN Holdings (now Lifestyle Holdings) founder and CEO Tawanda Nyambirai was reportedly paid a staggering US$39,9 million by the country’s leading telecoms giant Econet Wireless in September last year for securing its licence renewal and facilitating debt recovery from TelOne, the Zimbabwe Independent has learnt.

According to informed sources, the payment to Nyambirai by the diversified telecoms group raised eyebrows as there were reportedly a number of discrepancies in the transaction procedure, which include Econet’s alleged failure to capitalise the consultancy fee onto the licence fee as required by accounting rules.
Sources said the other irregularity was that Nyambirai used the money he received from Econet to pay its subsidiary, Steward Bank (formerly TN Bank) US$26 million to reduce his debt with the financial institution in a case which has been likened to “Peter paying Paul so that Paul can repay Peter — literally”.
There was also concern as to why the funds from licence renewal and debt recovery consultancy were paid through TN Harlequin which specialised in furniture manufacture and retail, not consultancy.
Sources also questioned why the funds were used to clear debts for other third parties as well. They also said the Reserve Bank of Zimbabwe was supposed to have been suspicious of the transaction as it had a material impact on Stewart Bank’s financial position.
The sources further said it was curious why the funds did not appear in TN Harlequin accounts where they were paid and consolidated into Lifestyle Holdings books, something which raises tax issues.
The Zimbabwe Independent recently reported on Nyambirai’s facilitation of a US$30 million loan facility to government last year. Econet confirmed the involvement of its former chairman as a consultant, saying it was an arrangement whereby government took over and settled interconnection debt owed by NetOne and TelOne.
Asked on Wednesday to respond on Nyambirai’s US$39,9 million payment, Econet ducked the issue claiming it was sub judice and that the story was based on “stolen, private and confidential information” in a bid to entangle the Independent in its current dispute with Reuters-affiliated news agency, The Source, even if the paper has nothing to do with it.
The business news agency was raided last month by the Deputy Sheriff’s department following a High Court order granted to Econet and Steward Bank to have the online publication delete or expunge the stories it had published on its site.
The raid – widely condemned by the media and other stakeholders – related to two published stories in which Econet reportedly extended a US$30 million loan to the government and the other concerning flamboyant local tycoon Philip Chiyangwa’s Pinnacle Property Holdings paying a US$2,1 million debt — under-secured by US$720 000 collateral — he owed to Steward Bank using land.
Econet went to court seeking an order to seize computers and search for the documents they claimed The Source stole. The order was granted. The case is still running in the courts.
However, the information obtained by the Independent – just like on the earlier published story about the loan to which Econet responded to professionally – was gleaned from informed sources in the market, not the said stolen documents.
The enquiries sent to Econet corporate communications manager, Rangarirai Mberi, on Wednesday were as follows:
=As per our telephone conversation, could you please help me with my enquiries;
=We understand, according to our sources, that Mr Tawanda Nyambirai received US$39,9 million payment for his services in securing the Econet licence renewal and facilitating the recovery of debt due to Econet from Telone;
=We are also informed that Mr Nyambirai used US$26 million of these funds to reduce his debt at Steward Bank. Is this true and if not what is the correct position, and
=My deadline is 15 00 hrs tomorrow (April 9 2015). Your assistance will be greatly appreciated.
Econet’s response was as follows:
“As you are aware, Econet Wireless and Steward Bank approached the courts and were granted an order against The Source for the deletion and expunging from their online publication private and confidential material relating to both entities, their directors, consultants, customers or counter parties. The order also interdicted the publishing or republishing “personally or through the agency of other persons” the names of both entities’ customers and the details of their loan or credit agreements with both entities.
“In addition, the court also interdicted the publishing of “contents of email and internal memoranda or correspondence of a private nature relating to the applicants’ business or that of its customers, consultants or other counter parties.
“The basis of the provisional order was that the private correspondence had been stolen and that its publication infringed upon Econet and Steward Bank’s and their clients’, customers’ and other related parties’ rights to privacy, particularly as the banker/client relationship is based on confidentiality.
“On this basis, the court granted an order authorising the recovery of the stolen information and documents, which has since been done. An application brought by Source-Net (Pvt) Ltd in an endeavour to stay execution of the provisional order and to have it thereafter set aside was dismissed by the High Court with an order that Source-Net pay Econet and Steward Bank’s costs on a legal practitioner and client scale.
“During the recovery of the stolen, private and confidential information, it was confirmed that the stolen private and confidential information had been conveyed through the agency of two former Steward Bank executives who accessed such information in the course of their duties and who were not authorised to divulge it to unauthorised third parties, and your enquiry relates to the exact same stolen private and confidential information whose publication the court has interdicted.
“There can be no doubt that Econet and Steward Bank’s financial services advisors fall under the category of ‘consultants’ who are specifically covered by the order. “On the advice of our legal advisors, we cannot therefore provide you with answers to your questions on the basis that the matter is sub-judice in so far as the provisional order is yet to be dealt with on the return day, that your questions relate to the very same private, confidential and stolen information in respect of which there is already an interdict and both Econet and Steward Bank are unable to disregard the very privacy it sought to protect in the first instance.
“Your use of stolen, private and confidential information would also be illegal and in breach of the provisional order already referred to which interdicted the publication of the information ‘through the agency of other persons’, which includes your publication. We trust that this fully explains Econet and Steward Bank’s position”.