The struggling Harare City Council (HCC) has lost millions of dollars in potential revenue over more than 15 years. This loss stems from a calculated scheme by senior officials to plunder resources at its subsidiary, Rufaro Marketing. Investigations by NewsDay have revealed extensive mismanagement and corruption within the company.
Rufaro Marketing was once a significant revenue source for the city, injecting thousands of dollars into council coffers. These funds helped build Rufaro Stadium and various amenities in high-density suburbs. The company also employed over 1,500 people at its brewery and 157 beer halls across the city. However, after disposing of some of its assets, Rufaro Marketing shifted to real estate, leasing 86 of its bars to tenants. Unfortunately, the rentals collected from these tenants did not reach HCC coffers, the sole shareholder, for a decade.
Former Rufaro Marketing CEO Daniel Mutiwadirwa stated that the company did not remit any funds to HCC for years due to debt payments. “Rufaro Marketing had a lot of debt; we were settling the debt for 10 years and could not remit any money to council,” he said.
Investigations by NewsDay uncovered that high-ranking officials at the company colluded with tenants. They partitioned and sublet the premises, charging rentals in United States dollars while paying Rufaro Marketing very little in local currency. A special report by the Harare City Council business committee, which NewsDay accessed, showed serious misgovernance at the institution, leading to massive looting.
“Eleven stalls averaging $660 at Hunters in Mabvuku were sublet by a Rufaro Marketing tenant. Rufaro Marketing received a meager ZWL$3,000, equivalent to just two stalls,” the report noted. It also emerged that the tenant in question is Citizens Coalition for Change Mabvuku councillor Alexio Nyakudya, raising issues of conflict of interest. “Yes, I had the lease from 2017. I have been sub-leasing because the lease is silent on subletting,” Nyakudya said.
Rufaro Marketing’s new director of operations, Juma Ulete, admitted that former management converted money for personal use. “We don’t know how money has been used for close to 10 years by the fired CEO Daniel Mutiwadirwa, and we are now going for a forensic audit. Rufaro Marketing had no audit in the last 15 years, and we had the first one recently,” he said.
“When we took over, there was a single employee called Mutiwadirwa who used to go around collecting money, cash in a car boot. Now, we have a functional bank account. There was no remittance or any money going to council for nine years, but from last year to today, we have directed funds close to $400,000 to council through direct cash remittance and works at Rufaro Stadium as instructed by a full council resolution.”
Harare Mayor Jacob Mafume stated that the special committee recommended firing Mutiwadirwa after realizing that the council had lost millions of dollars in potential revenue. “The committee had notable difficulty in engaging and meeting with the CEO of Rufaro Marketing. He evaded cooperation with the committee in providing key comments and evidence to support the work of the committee,” Mafume said.
The former chief executive allegedly did not call for annual general meetings for over ten years, as stipulated by the company’s articles of association. “The committee was not favored with minutes of any AGM [annual general meeting] or EGM [extraordinary general meeting] of Rufaro Marketing over the years, especially for the years leading to the decision to liquidate the company in September 2012 and the years following the decision to liquidate the company,” the report read.
Mutiwadirwa refuted the allegations, claiming that the board which fired him was not properly constituted. He denied any wrongdoing and insisted that the company’s debt situation justified the lack of remittance to the council.
