Online Reporter
Business Reporter
RIOZIM is facing allegations of financial misconduct, asset stripping and systematic fraud, sources familiar with the developments have said.
Inside sources claim these activities, including the alleged illicit diversion of company funds, non-payment of salaries for months and the theft of statutory and pension contributions were causing hardship for the workforce.
Most of the allegations have surfaced in High Court papers, where the workers are seeking to place the company under corporate rescue.
Hundreds of employees are reportedly struggling to afford necessities like food, rent and school fees due to the alleged fraudulent activities.
Some workers claimed to have been evicted from their homes, while others claimed that a lack of access to medical care, due to unremitted medical aid deductions, had resulted in their failing to access healthcare.
“The employees are hopeless,” said one anonymous source, emphasising the urgent need for intervention.
“Workers are crying out for someone to listen to the voice of the Zimbabwean people being exploited.”
The allegations paint a grim picture of a company in distress, with its assets reportedly being systematically stripped and sold to “shelf companies” or external entities.
The proceeds from these sales are purportedly not returning to official company bank accounts, according to sources.
It is further alleged that the company’s official bank accounts have been blocked by ZIMRA. In response, management is reportedly conducting business through undeclared accounts to avoid tax authorities, allegedly diverting income that would otherwise appear on financial statements.
Sources further claim the company sold coal reserves in Sengwa, Gokwe, despite knowing the Government had reclaimed the land due to inactivity, with the full proceeds believed to have been diverted.
Similarly, One Step Mine was reportedly sold for US$6,3 million, but sources allege the declared sale price was significantly lower, with the difference hidden. Assets like Dalny Mine and Palatial are also alleged to have been sold for undervalued sums and are now operated by the company’s directors.
Furthermore, alleged fraudulent, backdated tribute agreements with unsuspecting tributors are cited, with money from these deals allegedly not reaching company accounts due to the lack of operating bank accounts.
Group chief executive officer Swami Rajgopal had not responded to a request for a comment by the time of going to print.
“The employees are appealing for urgent intervention and protection from what they describe as “severe exploitation and financial abuse,” said one official who requested anonymity.
They urgued that authorities to investigate the allegations of theft from both the company and the Zimbabwean State.”
Last month, RioZim workers filed a High Court application seeking to have the company placed under corporate rescue to avert potential liquidation.
