Zimbabwe: Embattled ZEC Boss Under Fire

SUSPENDED Zimbabwe Stock Exchange (ZSE) CEO Emmanuel Munyukwi is set to appear before a disciplinary hearing next week, facing numerous charges which include, among other things, undermining the exchange's board and the Securities Commission of Zimbabwe (SEC) and incompetence.

Munyukwi was suspended last week after SEC CEO Tafadzwa Chinamo sent a letter on March 15 to the ZSE board highlighting how Munyukwi had undermined the regulatory body's authority and the ZSE Listing Committee.

According to the letter, SEC called for a meeting on March 13 between the ZSE board, the Listing Committee and financial advisors regarding concerns over the RioZim and Ariston circulars, which the regulatory body felt were issued without proper adherence to exchange regulations and provisions. Munyukwi's cellphone went unanswered when businessdigest tried to seek his comment.

Munyukwi is alleged to have cancelled the meeting without the consent of SEC and the ZSE board, a development which created confusion since other participants had already made other plans. SEC later revealed that the meeting would proceed as scheduled.

"The ZSE CEO mischievously contacted all persons due to attend the meetings, telling them the meetings had been cancelled as the ZSE would be engaging SEC directly on the matters. The ZSE did not at any time contact SEC nor acknowledge receipt of our letters," reads part of the letter by SEC to the ZSE board.

In the letter, Chinamo further highlighted that Munyukwi was unreachable by phone when they tried to establish why the meetings were cancelled and advised attendees that the meetings would proceed as scheduled, adding SEC would go ahead with its planned action with or without their presence.

"In the end, we met Ariston and RioZim, first the advisors, then in the afternoon we met the advisors together with representatives of the companies," wrote Chinamo.

But it is understood that ZSE Listing Committee chair, Vimbai Nyemba could not attend since she had made other commitments after the ZSE CEO had informed her of the cancellations.

RioZim and Ariston both agreed on the recommendations from SEC with regards to their irregular circulars and issued circulars to their shareholders incorporating issues raised by SEC.

Chinamo said that Munyukwi only responded later with responses which did not in any way address their concerns and as such the regulatory body regarded as not warranting a response, but rather a mere acknowledgement.

Munyukwi, who is accused of undermining the board, is understood to have granted permission for the two circulars of RioZim and Ariston to be published without prior approval of the ZSE Listing Committee.

"Bear in mind that the ZSE Listing Committee did not meet, as they should, to review and approve either corporate action. The ZSE did not issue the Listing Committee members with the two circulars, even after they were published. In the RioZim circular, the company writes that approval was granted by the ZSE Listing Committee," Chinamo said.

"It would appear the ZSE CEO considers himself the ultimate authority, with no regard to structures that are supposed to guide him. This is a gross violation of procedure, a disciplinary matter for the ZSE Board, which SEC must insist action is taken."

This comes after reports last year that stockbrokers were pushing for the ouster of Munyukwi after passing a vote of no confidence in him in a meeting where members sought to address issues affecting the viability of the exchange.

Munyukwi is believed to have fallen out of favour with member brokers since the extra-ordinary meeting held in June last year, where he failed to provide information to members regarding the ZSE audit, among other issues.

The fallout led to brokers calling for an EGM at the exchange ,which Munyukwi blocked on grounds of it not being properly constituted. It is understood that brokers forcibly made their way into the exchange building and convened their meeting but Munyukwi did not attend.

Chinamo also indicated Munyukwi continued to hold such a vital post without him satisfying minimum requirements for him to be the CEO of the ZSE.

"While on the CEO, his fit and proper documentation is still outstanding and I am of the view that he can't continue to hold such a vital post without SEC having knowledge of his credentials. We will write to the ZSE chair highlighting this issue and give him 5 days to comply, failure of which would mean suspending him," Chinamo said in his letter to the board.

Munyukwi will be allowed to appeal against his suspension and charges levelled against him in the disciplinary hearing. Both Chinamo and the ZSE chair, Eve Gadzikwa confirmed Munyukwi's suspension but could not furnish businessdigest with the charge sheet, saying the matter was subjudice.

It is believed that the charge sheet also includes issues with regards to lack of detail in ZSE financial statements, questionable procurement procedures and shambolic minutes of important meetings.

Munyukwi's suspension followed the relieving of duties of Tony Barfoot as the ZSE consultant three weeks ago. Barfoot is the former CEO of the ZSE.

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