Nssa in US$7m botched land deal

via Nssa in US$7m botched land deal – The Zimbabwe Independent July 18, 2014 by Herbert Moyo

More than US$7 million in public funds could go down the drain after the National Social Security Authority (Nssa) paid for land under dispute in yet another bad investment by the authority’s board concluded without due diligence.

Nssa paid US$7,4 million in 2012 for 650 hectares of land near Regina Mundi High School in Gweru with a view to developing residential properties, but has not been able to do so because the land is subject of a dispute between Portuguese businessman Roger De Sa, Anthony Hickey and Wilford Nyambo.

Nssa bought the land after it had been offered to it by Kizito Gweshe, the deputy director of counter-intelligence in the President’s Office.

Gweshe, who claimed to be a director and shareholder of Christmas Gift (Pvt) Ltd 2010, acted on behalf of De Sa and initially offered the land to Nssa for US$16,4 million.

However, the deal has since been put on hold after the Supreme Court, which has ruled that the land does not belong to De Sa, but is the property of a holding company called DMC. The shareholding structure of the holding company will have to be decided by the High Court.

Nyambo’s lawyer Beatrice Mtetwa also confirmed that the dispute is pending before the High Court.

Nssa general manager James Matiza confirmed Nssa was hamstrung by the court directive against making any developments on the land.

“We bought the land, but we have a directive to say do not do anything, do not make any developments on the land but beyond that I cannot comment any further,” he told the Zimbabwe Independent.

“The problem is that the issue (of the land) is before the courts. There is a white man (Hickey) who is challenging the sale and there is also another person, a Nyambo. So our legal team advised us against commenting as this may also arm our opponents.”

However, sources within Nssa say the board and management knew about the dispute as they had been warned in writing by Nyambo’s then lawyer, Norman Bvekwa.

After becoming aware, Gweshe and De Sa had offered the land to Nssa claiming to be the owners of the land. Bvekwa wrote to Nssa advising it of Nyambo’s claim to the land on the basis of being a shareholder in DMC.

Bvekwa’s letter, which was seen by this paper, has notes scribbled on it suggesting one of Nssa executives had cautioned against proceeding with the transaction and had advised Nssa “it will be futile to proceed with the valuation. It is best to wait and see”.

But Nssa ignored this and authorised the transaction amid indications that Nssa lawyer Davison Foroma of Sawyer & Mukushi legal firm did not even consult the aggrieved party as part of due diligence.

Sawyer & Mukushi was also engaged as the conveyancers, giving rise to suspicion there could have been a conflict of interest in Foroma pushing ahead to approve the transaction.

Nssa, however, denied any wrongdoing, claiming that “there was no conflict of interest because Nssa wanted to verify whether there were no legal impediments before purchasing the property”.

“When the report was favourable, Foroma was instructed to deal with the transfer since he was already familiar with the matter,” said Matiza.

Nssa has a well-documented history of poor investment decisions which have cost contributors millions of dollars spanning various sectors including deposits to non-performing indigenous banks, non-performing listed companies and non-profitable properties.
Nssa lost US$50 million it sunk in Capital Bank which closed this year.

In early 2012, media reports citing a report by the National Economic Conduct Inspectorate, revealed Nssa was exposed to local banks to the tune of more than US$200 million through a combination of direct equity investments, loans and money market investments in various but mostly indigenous banks.

In June 2012, Nssa was exposed to the tune of US$15 million which was deposited with Interfin Bank Corporation, and US$708 000 with Genesis Bank when it shut down.

Parliamentarians last week called for an overhaul of operations at Nssa after it lost millions through poor investment policies that have prejudiced thousands of pensioners.