In a letter dated 1 May 2020 the Financial Intelligence Unit which was tasked with following up on cases of those Bureau De Change that had been accused of illicit foreign currency dealings, instructed banks to freeze bank accounts belonging to mobile money agents of both Ecocash and One money who they also suspected of involvement in illicit foreign currency dealings.
In the letter, FIU acting Director-General Oliver Chiperesa also requested that the banks make available to the unit information on frozen accounts including shareholders, directors and ultimate beneficial owners. That mobile money agents have been involved in illicit foreign currency dealings should come as no surprise to anyone. The list is surprisingly long though with a total of 123 agents with 97 of them Ecocash agents while the remaining 26 are on money agents.
It seems the people at the Reserve Bank and Financial Intelligence Unit have gotten more work done against illicit foreign currency dealers over the lockdown period than they have in their entire history which begs the question, why now? Back when Finance Minister Mthuli Ncube announced the pending introduction of the Reuters based electronic trading system for the interbank market I surmised that we should expect a clampdown on the foreign currency parallel market and rate publishers. While the latter is yet to transpire the actions over the last few weeks confirm the former.
In spite of the size of the list, it is still a small drop in the ocean. The practices that have been flagged as illicit foreign currency dealing have not been detailed in the letter but many can hazard a guess as to what the agents are alleged to have been doing. An interesting time for the RBZ to take the fight to parallel market dealers as the USD/ZWL rate crossed over the 50 mark just last week. The rate has effectively doubled in the first 4 months of the year and it is likely not going to get any better in months to come.