Zimbabwean regime to enact law to impose jail sentence on money dealers

Foreign currency dealer.
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HARARE,– The finance minister of cash-strapped Zimbabwe, Patrick Chinamasa, has disclosed that the government is drafting legislation to enable jail sentences to be imposed on individuals who are caught selling cash at a premium to desperate people.

Zimbabwe is battling to contain a cash crisis, caused by externalisation and hoarding among other things, which has resulted in the resurrection of the money-changing business which had ended after the introduction of the multi-currency system in 2009 after the country abandoned the use of the Zimbabwe dollar, which had become virtually valueless.

Dealers buy hard cash (USD) at a premium of up to 30 per cent for bank transfers. On a cash-to-cash exchange basis, 100 US dollars for example, will earn the seller 108 US dollars in the “bond currency” introduced by the central bank despite the fact that the USD and the surrogate currency are supposed to trade at par.

Bond notes were introduced last year to alleviate the cash shortages.

Chinamasa said here Wednesday that currently the Banking Act only allowed the Reserve Bank of Zimbabwe to impose penalties on offenders.

“At the moment, we do not have a law that sends offenders to jail, we only have one that says offenders are penalised,” he told the National Assembly in response to a question on what the government was doing to curb the business of selling money.

“We agreed in Cabinet that we should have that law in place; we are now drafting the amendments because at the moment the law that we have under the Banking Act allows the RBZ to impose penalties on offenders.”

However, his responses seemed to anger MPs from across the political divide who continued to probe why government was seemingly ignoring a situation that was slowly getting out of control.

Under continued pressure, Chinamasa said he would issue a Ministerial statement to the National Assembly next week addressing the situation.–NEW ZIANA