Minister Mpofu in trouble over $3m debt

Minister Mpofu in trouble over $3m debt

Source: Minister Mpofu in trouble over $3m debt – DailyNews Live

Tendai Kamhungira      15 March 2017

HARARE – Macro-Economic Planning minister Obert Mpofu could lose his plush
Glen Lorne property after he was dragged to the High Court by CBZ Bank
over a long over-due debt of nearly $3 million.

According to court documents, Mpofu’s now-defunct financial institution,
Allied Bank, borrowed the money from CBZ and secured it with the prime
land in Harare, but failed to pay the loan back.

After accessing the loan, Allied Bank – which is the principal debtor –
later surrendered its banking licence to the Reserve Bank of Zimbabwe
(RBZ) in January 2015.

The bank was subsequently placed under liquidation before it paid back the
money.

The court has been told that upon its liquidation, Allied Bank owed CBZ $2
616 830,21.

“The defendant (Mpofu) had secured this debt through a surety mortgage
bond, securing amounts up to $2 million, allowing in terms of the bond the
plaintiff (CBZ), on default of payment by the principal debtor, to
immediately and without notice have the right to call up the bond and have
the hypothecated property declared executable,” reads part of the summons.

CBZ, Zimbabwe’s largest banking group, is now seeking an order to seize
Mpofu’s Glen Lorne stand, number 2501 – measuring 4 395 square metres.

“The plaintiff’s claim is for a provisional order in an amount of $2
million together with interest on that amount at the prescribed rate of
five percent per annum, calculated from the date of summons to the date of
full payment,” the court documents say.

CBZ further accuses Mpofu’s bank of failing to pay back the money, despite
a demand being made two years ago.

“The principal debtor, Allied Bank Limited, neglected or failed to pay the
outstanding debt to the plaintiff before it was placed under liquidation.

“In terms thereof, the principal debtor’s surrender of banking licence and
subsequent placement into liquidation has rendered the debt due and
payable,” CBZ claimed, also adding that Mpofu had not disputed the amount
being demanded.

In the court summons, Mpofu was asked to pay the money due to CBZ or
through the deputy sheriff.

Mpofu has not yet responded to the application, which was filed on Monday.

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