NPA declines to prosecute businessman Gilad Shabtai and his co-director

The National Prosecuting Authority (NPA) has declined to prosecute Israeli businessman and investor Gilad Shabtai and his co-director Munyaradzi Gonyora embroiled in a company wrangle with one Ofer Sivan as prosecutors deemed the case civil and emanating from boardroom squabbles and not criminal.

Sivan reported a fraud case against the two claiming they had swindled him of US$1,3 million. But prosecutors have deemed the case civil emanating from boardroom squabbles and not criminal.

On Thursday, Harare magistrate Barbra Mateko cancelled a warrant of apprehension that was obtained against Shabtai by the police.

His lawyer Admire Rubaya made an application for the warrant to be cancelled arguing that it was no longer necessary since the police and the State were no longer pursuing the matter.

He further argued that the warrant had been issued irregularly using a non existing provision of the law.

It was alleged that in March 2021 Shabtai and Gonyora without the authority of the board or shareholders of Adlecraft wrote to the Zimbabwe Consolidated Diamond Company (ZCDC) giving instructions on how to pay the outstanding debts.

They were also alleged to have opened two bank accounts for the purpose of receiving the outstanding amount.

It was claimed that on April 21 the two wrote a letter to Charles Gobvu, chief finance officer for ZCDC instructing him to deposit outstanding amounts into the newly opened accounts and deposited several amounts up to a total of US$1 300 000 without the consent of Sivan.

“A clear picture has been painted that there is a fight over the control of the company under consideration, which happens to be the source of income.

“Verbal claims and counter-claims are being made by the parties on who has which powers within the company.

“A relevant resolution to the opening of the Get Bucks Bank account was produced by the 1st accused person (Shabtai), which on the face of it meets the required quorum when it was made, though challenged by the complainant.

“However, in the absence of an order from a competent court it remains extant,” the prosecution said.

The prosecution said it is not their role to interfere in civil proceedings which should be dealt with by the civil courts, throwing out the element of fraud.

“It is not for the Prosecutor General to believe or disbelieve any of the parties in the fight over the ownership of the company. It is for the civil courts to determine the issue of ownership and control of the company.

“This scenario then raises the question whether the crime of fraud was committed as alleged. Fraud is being alleged by one of the directors, namely, Ofer Sivan against other directors. In paragraph 2 and 3 of his statement the complainant concedes that accused persons 1 and 2 are indeed directors.

“In view of that concession, a conclusion can then be made that accused 1 and 2 had the right to constitute themselves into a full quorum at a board meeting and come up with certain resolutions,” the prosecution said.

The State further stated that the issue of the money in dispute can also not be addressed by the criminal court and solution to their squabbles is the civil route.

“The resultant disbursement of the company funds, which is in dispute, cannot be further addressed by the criminal court. The solution to the grievances arising from the boardroom fights can only be resolved through approaching civil courts with the necessary jurisdiction to entertain such matters.

“The piecemeal resolution of the boardroom squabbles through the cheap criminal prosecution route, which comes with threats to personal liberty, is misplaced,” the State said.

The prosecution said pursuing a criminal route was an exercise in futility as there is no evidence to sustain a charge of fraud.

“It is my considered opinion that no criminal charge can be sustained from the available evidence. Essential elements for fraud or any other competent charge cannot be successfully established due to the disputes that the parties are having.

“No amount of further investigations can help the State sustain a prima facie case against the accused persons given the issues between the parties in the present circumstances. The criminal route was an exercise in futility. There is no prima facie case against the three accused persons to warrant their prosecution.

“Therefore, I humbly submit that prosecution be declined for lack of evidence,” the State said.