The stomach of America’s economy is still rumbling endlessly, and the foul stench from its bowels has been nauseating to both its allies and the world. Europe has consequently been diseased, while China continues to slow.

With the world’s biggest economies faltering, commodity prices have naturally taken a dive. And Zimbabwe is massively exposed since she is presently dependent on the export of raw materials to the developed world.
In the first six months of the year, more than 70 percent of export receipts came from the mining sector alone. Of late, platinum prices have retreated, with the result that revenues accruing to the national purse will drop, giving more sleepless nights, headaches, heartaches and hallucinations to the Exchequer.

But to put things into perspective, it is the sheer act of a coterie of greedy bankers, who were repackaging debt and selling risky assets in order to reap massive dividends which has brought the world to its knees.
The self-made financial engineers were so smart that regulatory bodies struggled to keep pace. However, when the whole experiment imploded, it was innocent home owners and depositors who bore the brunt. The economic wound festered to the extent that it began to affect the mainstream economy.

In essence, Wall Street affected Main Street. Perhaps the most telling act of unrestrained greed, callousness and incorrigible ill-will by those gentlemen who pride themselves as professionals in the financial services sector was when insurance giant AIG (American International Group) received a US$170 billion bailout package from the government in 2009. Directors of the firm, which was fresh from recording a loss of US$61,7 billion — the largest corporate loss in history — opted first to pay more than US$200 million in executive bonuses.

How absurd can it get? It typically shows that beyond those blue suits, white shirts and condescending smiles of bankers lie a cold heart. I am sure that depositors of both Interfin and Genesis will concur. Undoubtedly, it must be heart-wrenching, gutting and thoroughly traumatic to be told by the Depositors Protection Board, which is supposed to cushion affected depositors, that all one can get from his savings is a mere US$150 for the time being.

Here, we are talking of depositors who all the while were being terrorised by the criminal and extortionate interest rates and bank charges that are being levied by financial institutions.

But what might be jaw-dropping for ordinary depositors is, of course, the stubborn fact that the authors of their misfortune might never be visited by justice.
In the legal world, it is common that in order to appease the spirit of the wronged, justice must be done, and must also be seen to be done. Yes, justice might be blind only to an extent that it doesn’t discriminate; but, surely, it mustn’t be blind such that it doesn't see any evil.

Although the affected depositors continue to languish, especially from the pittance that they are receiving from the authorities, it is undoubted that those responsible for conjuring this mess continue to be nursed in the lap of luxury, what with the huge amounts they loaned to themselves. By the time Interfin was placed under curatorship, the bank was plagued by non-performing insider loans amounting to US$60 million. Its capital deficit had also ballooned to US$90 million, while it was also failing to pay US$22 million in fixed deposit maturities.

Had the money been extended to finance businesses that had strong potential to grow, maybe the shareholders might have had plausible extenuating circumstances. However, they simply threw money at their problems and, by extension, into a black hole without due diligence and prudential risk assessments. However, in this case, there is a thin line between recklessness and fraud. It is scandalous that a small clique of directors could share US$60 million in insider loans amongst themselves, while stressed companies nationwide are currently failing to access only US$40 million under the Distressed and Marginalised Areas Fund (Dimaf).

Talk about mind-boggling.
A fortnight ago President Mugabe expressed disgust at the way some of the financial institutions had decided to play Russian roulette with people’s funds. Also, finance minister Mr Tendai Biti termed this crop of bankers “mafia bankers”.

“Now, in recent times we have seen, albeit small, a small clique of predatory bankers, a small clique of mafia bankers . . . it is almost like a practice that if you want to rob the public, start a bank, and that is unacceptable; that is totally unacceptable,” remarked Mr Biti at the recent listing of TN Bank on the Zimbabwe Stock Exchange.

However, it is believed that authorities responsible for superintending these sectors must not only huff and puff, but it’s high time they swept this mess right to the doorstep of these corporate paedophiles who find fleecing and abusing depositors erotic.
Recently, the world watched with glee when corporate heavyweight Mr Bob Diamond, the chief executive officer of Barclays, was grilled and hauled over coals by Britain’s Treasury select committee over the Libor (London Inter-bank Official Rate) scandal through which the bank was accused of manipulating the key rate, which is generally used as a cue of ruling interest rates globally. Mr Diamond was also pressured to forgo more than US$33 million due to him in bonuses for bringing the financial behemoth into disrepute.

As it stands today, it seems that no one is even remotely interested in calling the accused shareholders at Interfin to answer about what really happened to depositors’ funds, including the funds deposited by Government. Such an exercise will help diagnose this disease before it becomes a pandemic. Unlocking and appreciating the DNA of this disease will also inevitably help to nip it in the bud the next time.
One would have expected that we have learnt from the horrific episodes that accompanied the clean-up in the financial sector at the behest of the Reserve Bank

Governor, Dr Gideon Gono, after he assumed office in November 2003.
The clean-up affected financial institutions such as Barbican, Royal Bank and Trust Bank. If the country doesn’t develop a holistic framework designed to strengthen the supervisory and oversight capabilities of the Reserve Bank of Zimbabwe, including punishing offenders who put the deposits of hapless customers in jeopardy and ably cushions affected depositors, then such crises will be our routine visitor.

Even if it means that we need to codify our laws so that all the legal instruments dealing with crimes of such a nature are harmonised, we should do it. The law mustn’t be ambiguous lest criminals escape justice on a technicality.
If these delinquent bankers are left without as much as a censure, it will mean that they won’t be deterred from committing the same offence again. It goes without saying that banks are supposed to play a pivotal role in society, but not in Zimbabwe it seems.

Naturally, banks are supposed to be an intermediary establishment which pools funds from other operators in the market and channel them to the needy and productive sectors of the economy — a Robin Hood institution that takes from the rich and gives to the poor only to stimulate viable economic activity. However, it seems that in Zimbabwe this critical sector has been transformed into a pickpocket institution that is meaningless to the lives of ordinary depositors. This is the reason why depositors have changed pillows and wardrobes into vaults that store their wealth and not charge for it.

Crucially, there is a need for urgent intervention by the policymakers to force banks to become responsible corporate citizens, and to restore the sanctity that is due to the sector. Obviously someone somewhere is sleeping on the job.