Well, tried a little exercise advised by a mate of mine... Tuped in the name of teh Chief Financial Executive Cornwell Muleya into the google search engine... Guess what came up... Eye-poping is an understatement! Read on. No further comment!
Daily News
Air Zimbabwe loses billions in French deal
3/27/2003 6:46:44 AM (GMT +2)
By Precious Shumba
Cash-strapped Air Zimbabwe has been prejudiced of billions of dollars
in scarce foreign currency as it forges ahead with its plans to acquire two
50-seater aircraft from Air Littoral Industrie SA of France. The money has
been lost through the payment of bonus fees to intermediaries, travel
allowances and kick-backs to management.
Sources familiar with the contract strongly feel that the airline's
management has to be investigated for illegal foreign currency dealings as a
matter of urgency or the airline could collapse. Documents made available to
this reporter show that Air Zimbabwe entered into an agreement with two
organisations to act on its behalf in order to hire two ATR 42-500 MSN 484
aircraft. The aircraft will service central and southern African routes.
The lease agreement is subordinate to, and consistent with the terms
of a sub-lease agreement between Maela Finance BV of Canada and Air Littoral
as sub-lessee as per agreement struck on 28 June 1996.
Aviation experts described the agreement as a "contract within a
contract". Air Zimbabwe will pay Air Littoral US$147 000 (Z$8 million) for
each of the planes every month for the next three years.
Efforts to get a copy of the memorandum of understanding between the
airline and the French company on Monday failed. But sources said the
management had committed the airline for the next three years and millions
in scarce foreign currency will be paid to the French in travel allowances,
monthly rentals and maintenance work. Rambai Chingwena, the airline's
managing director, refused to discuss the
deal saying it was premature for him to disclose it.
He said: "It (comment) will come at the appropriate time. It's at a
stage not for public disclosure." An e-mail to Chingwena by Lionel Sineux,
the head of fleet management at Air Littoral Industries dated 12 March,
shows that Air Zimbabwe has already paid US$357 881,09 (Z$286 304 872) as
part of US$450 000 (Z$360 million) security deposit before the plane is
delivered.
A source said: "This ATR business has been Chingwena's preserve. He
has flown outside Zimbabwe on several occasions and claims large amounts in
foreign currency. "The airline has lost substantial amounts through this
secretive deal. The money that Cornwell Muleya, an aviation consultant and
the former acting general manager for Air Botswana was paid, should have
been used to rehabilitate the British Aerospace 146 which has been lying
idle in the hangar since 1999.
"The money should have been paid directly to Air Littoral Industrie
without engaging private individuals and consultants. "The delegation that
travelled to France should have done that in the first place than wait to
lose millions in foreign currency. Air Zimbabwe paid for Muleya's travels at
US$350 each day he travelled on Air Littoral business."
Another US$170 000 (Z$136 million) was paid as commitment fee . An
additional US$102 086 was paid but Sineux was unsure what that amount was
for, saying he only knew that that transaction was initiated by the
Commercial Bank of Frankfurt (CBF). The contract was signed despite
resistance from government and advice from Air Botswana which once dealt
with Air Littoral. Air Zimbabwe first entered into an agreement to engage
Muleya as their consultant, to source the planes .Muleya wrote to Dennis
Maravanyika, Air Zimbabwe's former senior marketing manager, on 17 October
2002 expressing his satisfaction with the contract.
Muleya was said to have been paid US$25 000 (Z$20 million) as success
fee for each of the ATR planes and will receive an additional US$10 000 (Z$8
million) as bonus fee for each of the planes once the aircraft are delivered
to Harare.
This money is meant to thank Muleya for not exceeding the target
rental of US$100 000 which Air Zimbabwe was prepared to pay for the
aircraft. The aircraft were sourced at a rental of US$90 000 each.
Sources said since the memorandum of understanding between Air
Zimbabwe and Air Littoral was signed about four months ago, Chingwena has
undertaken several business trips to London, France and Canada, pursuing the
deal and claiming millions of dollars in foreign currency.
For example, Chingwena last Wednesday travelled from Harare on the
pretext that he was going to Montpellier in France to seal the deal with Air
Littoral but instead stayed in London because his visa to France was
invalid.
He later proceeded to Canada on unspecified business. He will return
on 6 April. According to sources who travelled to France last week,
Chingwena received US$10 800 (Z$8 6 40 000) at the rate of US$600 daily
allowance.
Five senior managers who travelled to Montpellier returned to Harare
last Sunday. Each was paid a daily allowance of US$350 for the one week they
stayed in France although Air Littoral paid for their
accommodation and flight expenses.
Meanwhile, when Muleya's relationship with Air Zimbabwe reportedly
soured, Air Zimbabwe approached Beaumont and Son of the United Kingdom to
assist them complete the Air Littoral deal. Patsy Barnes of Beaumont and
Son, according to documents at hand, faxed Air Zimbabwe on 18 March,
acknowledging receipt of the airline's accounts and a copy of the memorandum
of agreement.
Chingwena immediately faxed Cathy Oatridge at their London office
concerning the legal fees. He said: "Please can payment be made immediately
to Beaumont and Son in terms of the attached." He directed that the money be
deposited in the Beaumont and Son Sterling client account 0996602 sort code
18 00 02T on the same day.
On 19 March, James
Edmunds, a partner in Beaumont and Son, wrote to Air Zimbabwe
confirming Chingwena's flight schedule and said he was looking forward to
meeting him in France. Air Zimbabwe workers said the swift manner in which
Chingwena responded to the request to deposit the $44 million in foreign
currency into the Beaumont and Son account, had shocked them.
The same management has refused to release foreign currency to carry
out modifications on three Boeing 737 planes. The Civil Aviation Authority
of Zimbabwe has reportedly threatened to ground the planes by 31 March
unless the modifications were carried out.