KEY POINTS
- Two Harare businessmen face fraud charges over $1.4 million property sale.
- Alleged fraud involved a forged power of attorney and unauthorized property transfer.
- Meadow Sweet Investments claims severe financial loss with no recovery so far.
Two prominent businessmen in Harare, Satishbhai Patel, director of Honda Centre, and Ebrahim Mahomad, director of Union Hardware, are facing allegations of fraud involving a $1.4 million property deal. Both men were arrested last week and brought to court for allegedly violating section 136 of Zimbabwe’s Criminal Law (Codification and Reform) Act.
Fraud allegations and shady dealings
The complaint was brought by Meadow Sweet Investments, represented by Nyasha Emmanuel Watyoka. According to the State, Meadow Sweet Investments bought a partially developed double-story property at stand number 3081, Salisbury Township, in 2002. The property was left unattended by its directors when they left Zimbabwe in 2004.
In 2011, Patel and Mahomad allegedly devised a plan to fraudulently sell the property, taking advantage of the property’s idle state. The two men allegedly forged a special resolution that made Patel appear as a director of Meadow Sweet Investments, thereby authorizing the sale of the property.
According to New Zimbabwe, Patel and Mahomad are also accused of drafting a power of attorney, allowing fugitive Cuthbert Chengeta to transfer the property’s title to the Zimbabwe Energy Regulatory Authority (ZERA).
In 2023, Dr. Muchazoreka Richardson Nyamugama, one of Meadow Sweet Investments’ directors, returned to Zimbabwe with plans to renovate the property. He discovered that the property had already been transferred to ZERA and was under use.
Upon further investigation, it was revealed that the transfer was done through Chengeta, who acted as a conveyancer using a power of attorney supposedly signed by Patel.
The State insists that Meadow Sweet Investments never authorized the sale and that Patel was not a director of the company, as claimed in the special resolution.
Investigation findings and court proceedings
According to the Zimbabwe Revenue Authority (ZIMRA), the capital gains tax certificate used in the transfer was not genuine and could not be traced in their records. Prosecutors claim that Patel and Mahomad acted without legal rights and that their actions caused a loss of $1.4 million to Meadow Sweet Investments, with nothing recovered so far.
The fraudulent nature of the sale and the falsified documents used by Patel and Mahomad are now under scrutiny as the court proceeds with the case. Also, the authorities stress that such fraudulent activities severely affect businesses and individuals who rely on the safety and legitimacy of property transactions in the country.
The case against Patel and Mahomad is seen as an example of the challenges facing Zimbabwe’s property sector, where fraudulent deals and weak enforcement of regulations often put property owners at risk. The involvement of public entities, like ZERA, also raises concerns about transparency and oversight in property acquisitions.
