Bank accounts of a Chinese diamond mining company accused of illegally transferring $585million out of Zimbabwe have been closed as the investigation goes international.
BancABC, a member of London Stock Exchange-listed financial services group Atlas Mara Limited, has closed Jinan Diamond Mining Company accounts in Zimbabwe and Zambia, with police casting their net wider to Sierra Leone and Tanzania.
At the beginning of the investigation four months ago, the Chinese company was initially believed to have externalised $340m without exchange-control authorisation from the Reserve Bank of Zimbabwe but the probe has since uncovered cash transfers totalling $585m.
This is the single largest investigation of a diamond company since the official discovery of a huge gem field in the Marange area of eastern Zimbabwe in 2009.
In February, President Robert Mugabe revealed that diamonds worth $15billion had been looted from the site described by geologists as the world’s biggest diamond discovery in a century.
Jinan is one of seven mining companies that were evicted from the diamond fields by the government early this year.
The state has effectively nationalised the diamond sector, launching a new state-owned firm to conduct all mining operations.
On July 8, BancABC was served with a warrant of search and seizure in the same matter requesting certified copies of telegraphic transfer confirmations and payment instructions and withdrawal slips.
“The bank eventually collated all the information early this month (October) and submitted to the police. For now the bank can only wait for the investigations to proceed while its lawyers closely monitor the developments,” a senior bank manager confirmed.
In May, former BancABC managing director Hashmon Matemera appeared at the Harare Magistrates’ Court charged with externalising the funds on behalf of Jinan during his period at the bank.
Allegations against Matemera are that he facilitated the externalisation of $333m for Jinan Diamond Mining Company to Botswana, Zambia, Sierra Leone, Mozambique, Dubai and China when he was still at the helm of BancABC in 2013.
A Zimbabwean prosecutor, Sabastian Mutizwa, last week told a court during Matemera’s trial that the investigation had been taken beyond the borders.
“Investigations in this case are still ongoing. The investigating team is set to travel to Sierra Leone, hence we seek a longer postponement of the case to December 8,” he said.
Investigations have revealed that between January 2012 and July last year, Chinese construction giant Anhui Foreign Economic Construction Company (AFECC), through a series of transactions, transferred funds amounting to $585m into Jinan diamond Mining Company’s transitory account in Zimbabwe from China.
The transitory account, it has emerged, was then closed on August 5 2014.
“On December 20 2011, Jinan Mining opened a transitory account with BancABC Zimbabwe for purposes of holding funds from and on behalf of AFECC. The funds were to be used to fund AFECC’s operations in the southern African region, including Zimbabwe,” a source revealed.
“AFECC, through a series of transactions, dating from January 9 2012 to July 25 2014, transferred funds amounting to $585m into the Jinan Mining transitory account, from China.
“The transitory account was closed on August 5 2014.
“During the period which the transitory account was operational, that is January 9 2012 to July 25 2014, Jinan Mining was still going through the process of setting up the business and was not yet exporting minerals.
“An export-designated account was opened on December 20 2013 and the export proceeds were channelled through the export-designated account.”