Zimbabwean Central Bank freezes bank accounts over price blitz, over-pricing shops penalised

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THE Reserve Bank of Zimbabwe Financial Intelligence Unit (FIU) has ordered retailers and manufacturers who were exclusively charging certain goods in foreign currency and using the black-market rate for currency conversion in defiance of Government monetary policy to go back to ethical business practices.

The FIU has also frozen 16 bank accounts for traders, individuals and companies who were found flouting regulations relating to the prescribed rates and fueling economic instability. Some of the retailers in Bulawayo have started adjusting their prices in line with the prevailing official exchange rate while also accepting local currency for previously “exclusively foreign currency priced goods and products”. In an interview, FIU director-general Mr Oliver Chiperesa said retailers across the country have assured them that they were rectifying their pricing models.

“We engaged with them and they have assured us that they are relooking into their pricing models. Yes, some had items that they were not allowing clients to pay for using the local currency, but we have told them that is not acceptable and they agreed to rectify it. They also assured us that customers will be able to pay in local currency for all goods whose prices have been marked in foreign currency only,” said Mr Chiperesa.

Reserve Bank of Zimbabwe

He said some companies had paid fines following the closure of their bank accounts by the central bank. Mr Chiperesa said last week, they had to freeze additional accounts that also included those of individuals.

“This past week we also froze an additional six bank accounts of traders who were also violating the regulations relating to the prescribed rates that must be used by traders and penalties will be issued to them this week. The penalties are usually in the form of fines and as we said before repeated offenders will end up being recommended for cancellation of their trading licences. We have also frozen the accounts of 10 individuals and companies who were involved in the parallel market. They are not necessarily traders but they are companies in various sectors as well as individuals whom we traced their transactions and found that they were participating in fuelling the exchange rate on the parallel market. Again, we will issue them with penalties in the course of the coming week.”

Mr Chiperesa commended Government measures and policies that were put in place to arrest forward pricing and malpractices believed to be fueling exchange rate volatility, stating that the corrective measures were bearing fruit and stabilising the local currency.

“We have witnessed that for the first time in the last five or six weeks, the black market rate is now starting to stabilise because of the effectiveness of the policies that have been put in place which we are supporting as the FIU by making sure that those who destabilise the foreign exchange are dealt with severely in terms of the law.”

He said despite these efforts, there were still some rogue businesses who they continue to monitor to ensure that they were brought to book. Giving an example of one supermarket in Belvedere, Harare, Mr Chiperesa said it had a rate higher than the parallel market.

“On Friday we found out that this supermarket was using an exchange rate of US$1:ZW$10 000 which has no relationship with even the parallel market. So it is just a rate they came up with as forward pricing just to destabilise the rates because the most extreme parallel market rates were 8 000, but they are beginning to go down.” The official rate last week stood at US$1: ZW$5900.