A staggering US$1 million stolen from Namibia’s SME Bank was laundered through a complex scheme involving Robert Mhlanga, the former pilot and confidant of Zimbabwe’s late President Robert Mugabe. The revelations come from court documents filed in South Africa’s Gauteng High Court by the liquidators of the now-defunct SME Bank, shedding light on the murky financial operations that funneled stolen funds across borders.
Complex Web of Fraud and Laundering
According to the liquidators, Ian McLaren and David Bruni, approximately N$20.8 million (US$1 million) was funneled from SME Bank into the trust account of a Johannesburg law firm, Paul Casasola & Associates, between 2014 and 2015. The firm, owned by Mhlanga’s then-lawyer, Paul Casasola, allegedly played a central role in distributing the funds. While N$2 million was retained by the law firm, the remaining N$18.8 million was transferred to Mhlanga and various entities associated with him.
The court documents reveal that these transactions were part of a sophisticated money laundering operation. The liquidators allege that the funds were transferred from SME Bank through a series of entities, including Transparency Business Solutions and Rustic Stone Trading, before ending up in Casasola’s trust account. The transactions were carefully structured to avoid detection by Namibian authorities, with initial amounts ranging between N$245,000 and N$355,000.
Mhlanga’s Connections and the Fallout
Robert Mhlanga, widely known as a close associate of Mugabe, was no stranger to controversy. His ties to the Mugabe family and his involvement in the Marange diamond fields had long been the subject of scrutiny. In this case, Mhlanga quickly settled with Namibian liquidators when they pursued him in South Africa, repaying the N$18.8 million. However, the incident has exposed the exploitation of a bank meant to support small and medium-sized enterprises (SMEs) in Namibia, raising questions about the role of politically connected individuals in financial crimes.
The liquidators’ case also highlighted the failure of entities like Paul Casasola & Associates to comply with South Africa’s Financial Intelligence Centre Act (FICA). The law firm claimed ignorance of the funds’ origins, stating that they received the money on behalf of Mhlanga and his company, Liparm Entities. However, the liquidators argued that Casasola’s actions were reckless and contributed to the fraudulent scheme that ultimately caused the collapse of SME Bank.
Broader Implications and Ongoing Investigations
The case has broader implications for financial regulation and oversight in both Namibia and South Africa. The looting of over N$247 million from SME Bank has prompted investigations by the Namibian authorities, with the Supreme Court referring the matter to the prosecutor general for further action. Judge Dave Smuts of the Supreme Court questioned how such a massive theft could occur over an extended period without intervention from the Bank of Namibia, the country’s financial regulator.
This case also brings to light the international nature of money laundering schemes and the challenges faced by authorities in tracking and prosecuting such crimes. Mhlanga’s involvement, given his status as a former high-ranking military officer and business representative for the Mugabe family, adds a layer of complexity to the case, illustrating how individuals with significant political connections can exploit financial systems across borders.
As the investigations continue, this case serves as a reminder of the need for stringent financial regulations and the importance of cross-border cooperation in tackling financial crimes. The exposure of such a high-profile laundering operation underscores the vulnerability of financial institutions, especially those in developing countries, to exploitation by well-connected individuals.
Source: New Zimbabwe
