Thousands of investors duped

Walter Mswazie Masvingo Correspondent
About 5,000 people, mainly civil servants from Masvingo who invested with Mc-Dowells International (Pvt) Ltd risk losing their money following reports that the money-lending company has been put under judicial management after cancellation of its operating licence.

The Reserve Bank of Zimbabwe (RBZ) cancelled the company’s licence last year after the firm had flouted RBZ regulations by accepting deposits.

Documents in possession of Chronicle issued at the end of November, show that the company has since been placed under judicial management and has advised its clients to approach legal representatives for any queries and not the director, Member Chipamba.

“May all investors with pending cases approach the following legal firm, Nyika, Kanengoni and Partners of 155 Samora Michael Avenue, to sign a petition for the placement of Mc-Dowells International (Pvt) Ltd under judicial management on the basis of failure to repay invested funds,” reads part of the petition.

Indications are that some investors risk losing their money since it is now impossible for the clients to successfully sue the judicial manager.

The new development has dampened the spirits of investors who feel they were duped of their hard earned money. Sources privy to the matter say that the money owed to investors is about $18 million yet the assets declared are valued less at than $4 million if disposed.

It has emerged that Chipamba allegedly bought private property using depositors’ money, a situation that led to Mc-Dowells International facing liquidity challenges.

It is also alleged that Chipamba and his wife, Linda Dewa, registered a company under the name Honeyspruit Investments (Pvt) Ltd in South Africa. The couple allegedly used the name of this company to acquire a number of properties in neighbouring countries.
Honeyspruit was registered on August, 30, 2011 with registration number K2011/109188/07, according to the documents.

The dates the properties were acquired correspond with the times when local investors were contributing money into Mc-Dowells International.

Soon after the acquisition of the properties, the money-lending company went bust and had its licence cancelled leaving scores of investors stranded.

A local lawyer who preferred anonymity said that the fact that the company had been placed under judicial management means investors may fail to recover their money in the event that Mc-Dowells International is declared insolvent.

The lawyer said there were few cases when companies put under judicial management survived insolvency.
“What it means now is that, investors can no longer sue Chipamba because of the new developments. Given the scenario that the company is under judicial management, investors run the risk of losing their money if the company is declared penniless.

“The move by Chipamba is deliberate probably for obvious reasons that he has a fallback somewhere else in the event that his company collapses,” the lawyer said.

Investors want Chipamba investigated for allegedly externalising funds and are pressing for justice so they can recover their money.
The media has in recent months covered several stories of money-lending companies and pyramids duping unsuspecting investors of their hard-earned money.

Many cases are before the courts. Efforts to get a comment from Chipamba were fruitless as his mobile number was not reachable at the time of going to press.