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Mnangagwa ally Tagwirei moved suspect funds through fake invoices

President Emmerson Mnangagwa’s advisor, Kudakwashe Tagwirei, allegedly moved suspect funds from the Reserve Bank of Zimbabwe to London using fronts, false invoices and offshore financial facades, according to The Sentry and Open Secrets.

In a joint investigative report titled ‘Fronts, Fakes, and Facades: How South African and Mauritian Enables Helped Move Million from Zimbabwe to Britain’, The Sentry and Open Secrets revealed that Tagwirei made three payments to secure Bindura Nickel and Freda Rebecca Gold Mine at a total cost of US$29.5 million.

The Sentry and Open Secrets report that South African company directors, a Mauritian management company agent, a Cayman Islands investment fund, banks in numerous jurisdictions, and the company administrators in the United Kingdom— wittingly or unwittingly, facilitated Tagwirei’s purchase of the two mines.

Many of these actors, reports The Sentry and Open Secrets, knew that Tagwirei was behind the deal and some designed structures that had the effect of obscuring his involvement while others had enough information that they should have suspected he was involved and asked appropriate questions.

The investigative report reveals that Tagwirei allegedly used Sotic International, a Mauritian company that documents suggest was his front, to buy the mines for $29.5 million (R431 million, £23 million) from ASA Resource Group (ASA), a bankrupt firm that was being run by British company administrators Duff & Phelps (now known as Kroll).

According to The Sentry and Open Secrets, the purchases were made in three payments with each stage involving behavior that raises questions.

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Indications are that Sotic’s Zimbabwean subsidiary, Landela Investments, obtained hard currency from the Reserve Bank of Zimbabwe at a favorable exchange rate when cashing in a $60 million portion of a large Treasury Bill given to Tagwirei’s company, Sakunda Holdings, with Landela telling the RBZ that some of the funds were needed to buy Bindura Nickel.

“To get money into Mauritius from Zimbabwe for Sotic’s second £12 million payment, South African directors created invoices for exports that could not be found in Zimbabwe’s official customs records, raising questions as to whether trade misinvoicing, a technique commonly used in trade-based money laundering, had occurred. For the final £8.7 million payment, Tagwirei moved his money into Sotic via a complex offshore façade that had the effect of disguising the source of funds.”

Tagwirei was unavailable for comment as he was not responding to calls on his mobile phone. The United States imposed sanctions on Tagwirei after accusing him of corruption.

The Sentry and Open Secrets report that estimates suggest that Zimbabwe loses between $500 million and $1 billion every year to illicit cross-border transactions.

“The documents reviewed in connection with this investigation suggest that the transactions to buy the mines are a textbook example of how money moves from some of the poorest countries on earth into some of the richest via enablers and a lax legal framework in the offshore world.”

The Sentry is an investigative and policy organization that seeks to disable multinational predatory networks that benefit from violent conflict, repression, and kleptocracy.

Open Secrets is a non-profit organisation which exposes and builds accountability for private sector economic crimes through investigative research, advocacy, and the law.

Read the full report here: ‘Fronts, Fakes, and Facades: How South African and Mauritian Enables Helped Move Million from Zimbabwe to Britain