Creditors crank heat on Mpofu’s Allied Bank

Source: Creditors crank heat on Mpofu’s Allied Bank – DailyNews Live

Tendai Kamhungira      12 July 2017

HARARE – Liquidator of the collapsed Allied Bank, Cecil Madondo, who is
being sued by one of the creditors seeking to recover money locked in the
financial institution, has said the Deposit Protection Corporation (DPC)
must  provide answers to the bank’s creditors.

Zimbabwe Amalgamated Housing Association (Zaha) is seeking to recover
nearly $1,5 million locked up in the financial institution.

Allied Bank, majority owned by a vehicle linked to Economic Planning
minister Obert Mpofu, had its licence cancelled by the Reserve Bank of
Zimbabwe (RBZ) in January 2015 after it was found to be in an unsafe
financial position.

According to the High Court application filed last month, Killer Zivhu –
who is Zaha’s chairperson – is seeking an order for the removal of Madondo
for alleged failure to comply with his statutory duties to repay the
locked-up money.

In the application, Zaha cited Madondo, Allied Bank and the Master of High
Court as respondents.

Madondo in his notice of opposition claimed that he is not the liquidator.

“In terms of Section 37 (3) of the Deposit Protection Corporation Act
(Chapter 24:29), the Deposit Protection Corporation (DPC) as represented
by its chief executive officer . . . John Mafungei Chikura, is the
liquidator of Allied Bank Limited,” Madondo argued.

He said that the relationship between him and the liquidator is that of a
principal and agent.

“It therefore, stands to reason that I have been wrongly cited in the
current proceedings as I am not the liquidator and I do not have any
personal interest in the matter. The party best placed to field any
questions and concerns raised by applicant is not before the court.

“Applicant’s application cannot stand for want of compliance with rules of
this honourable court. Applicant’s erroneous pursuit of first respondent
has left my name soiled for no sane reason that can come to mind.”

Madondo further claimed that the success of the liquidation was dependent
upon the recovery of $31 million, and said they were awaiting High Court
approval to liquidate assets amounting to $16 million to be recovered from
Mpofu’s investment vehicle Trebo & Khays (Private) Limited.

In his application, Zivhu had alleged that Madondo was failing in his
duties, considering that it is more than two years since his appointment,
yet he has done nothing towards making sure that creditors get their
money.

Zivhu had accused Madondo of grossly failing to protect the interests of
creditors and called on the court to relieve him of his duties.

“It is my humble submission that a person appointed as a liquidator owes
some fiduciary duties to the creditors amongst others which is to keep
creditors well informed of the steps which he is taking to recover what is
owed to them and the duty to comply with provisions of the law regarding
the lodging of accounts,” Zivhu said.

“I therefore seek a compelling order in terms of Section 280 to lodge his
full and final distribution account with the Master of High Court within
seven working days from the date that this order is granted,” he said,
adding that Madondo must surrender the bank’s assets, including title
deeds, records, bank accounts among other items to the Master of High
Court within seven days of the order.