The Sunday Mail
Emmanuel Kafe
The oppressive gloom at the grubby Harare International Roadport belies its stupendous importance to the informal or black market.
Over the years, it has emerged as a den of illegal money changers.
However, of late, it has become the source of a potentially damaging disease for the economy — fake money!
Monetary authorities in Zimbabwe could soon be faced with more than just money supply and currency instability problems if fake money fraudsters continue to operate without restraint.
With the International Monetary Fund (IMF) ranking Zimbabwe’s informal economy as the second-largest in the world, counterfeit money peddlers have taken full advantage to flood the market with fake US dollars and bond notes. When converting foreign currency to local bills, many Zimbabweans shun local bureaux de change and other formal financial institutions in favour of the black market, where the exchange rate is higher.
However, criminal syndicates operating mostly in towns and cities take this opportunity to fleece people of their hard-earned money through elaborate scams. So grim is the situation that even big banks have been accused of circulating counterfeit notes.
In October last year, two top banks were separately dragged to court on allegations of issuing fake notes to unsuspecting clients.
The Sunday Mail Society spoke to the Bankers’ Association of Zimbabwe (BAZ) vice president Mr Webster Rusere, who said although he was unaware of the court case, he believes the allegations need to be thoroughly investigated by his association.
“I am yet to hear of the claims but I believe it is something that needs to be looked into and investigated so that we get to the bottom of it all,” said Mr Rusere.
Supermarkets, long-distance buses, churches and other service providers have not been spared either.
A survey by this publication in the capital city revealed that scores of businesses have been victims of fake currency scams.
Wads of fake local and foreign currency notes were displayed in many of the shops we visited, first as warning to the public not to be caught trying to use them and, secondly, to educate the public on the features to look out for to distinguish fake money from genuine currency.
The prevalence of fake notes comes at a time when local currency has continued to be scarce.
Despite the growing use of electronic payments, the majority of Zimbabweans still prefer transacting using cash as it can be much cheaper in some shops, leaving them vulnerable to fraudsters pushing counterfeit notes.
Who is behind the fake notes?
Our investigation took us to Harare International Roadport on Robert Mugabe Road.
The bus terminus handles more trade than some of Zimbabwe’s banks.
Here, the black market is king.
Amid the hustle and bustle, we established that the source of the fake notes — bond and US$ — is an underground operation run by a ring of fraudsters.
The cheats involve local and foreign nationals who print and circulate the notes.
Disguised as a cash dealer, this reporter caught up with an illegal money changer identified as Reuben aka Speed, who pushes fake notes on the streets of Harare and has agents who work for him.
He drives a recently imported white Toyota Mark X without number plates.
As we conversed — with this reporter pretending to be eager to join the lucrative ring of fraudsters — Speed let his tongue loose.
Without a hint of caution, he shared his squad’s “get-rich-quick scheme” and how easy it was to dispense the fake money to unsuspecting money-seekers.
“I do not operate from one place. Tomorrow you will not see me here. Perhaps you will find me at Eastgate Mall and the next day maybe I will be in Mbare,” he revealed.
When he hits the jackpot (swindles large sums of money), Speed lies low for weeks.
He urges his gang that when changing US dollars into bond notes they should mix them with genuine money to blindside the victims.
Asked about the source of the notes, Speed hinted that he has bases in Sunningdale and Dzivaresekwa.
The fraudster revealed that he is supplied with a special paper and ink cartridges from South Africa and China used to print fake money. “The counterfeit notes are ‘bleached’ from the original currency value and such bills cannot be spotted using money detectors,” he said.
According to an international crime agency, bleached bills are a form of counterfeit money made from legitimate currency, usually in denominations of $1 or $5 bills. Genuine currency is typically bleached with household chemicals to remove the ink from the bill.
A new, larger denomination is then printed on the legitimate paper.
Speed added that their business was big and involved influential people who come to their rescue in the event that they are caught by law enforcers.
Further inquiries by this publication revealed that some of the big players are foreign nationals, who fund runners like Speed that later distribute the fake money around the country.
Victims share ordeal
Registered mobile money agents countrywide have lost thousands of dollars to fake money fraudsters.
At Arcadia shops alone, the con-artists recently hit three separate agents, getting away with almost US$1 000.
“They use unregistered vehicles. In our case, they used a black Toyota Wish,” said Shepherd Mugabe, who operates from Arcadia shops along Seke Road.
He added: “They approach you with US$100 bills and their rates are very attractive. They never disembark from the car and once the deal is done — they speed off.”
Mugabe and his other victims showed this publication chats on a WhatsApp group used by hundreds of mobile money agents.
In just two days, a fortnight ago, scores of agents were complaining of being ripped off.
The agents also give each other tips on how to identify the criminals.
Another victim, Isaac Kudaringwa, was robbed of more than $1 100 in bond notes at Eastgate Mall while attempting to buy US$50 on the parallel market last month.
Kudaringwa was given two counterfeit US$20 notes, a fake US$5 and a single genuine US$5.
After discovering that he had been conned, he came back with police but the illegal money changers had melted into thin air.
“The guy is known by other money changers. Each time we arrive at Eastgate Mall we are told he has left.”
There are thousands of youths operating as illegal money changers countrywide. The business is lucrative, but as many victims of fraud have discovered, not all are genuine.
Be cautious
While the exact source of fake money remains a mystery, counterfeit currency continues to be pumped into the black market.
Financial experts said it is always advisable to deal with registered financial institutions as there is a lesser chance of getting duped.
In the case that people are desperate and have no choice, members of the public are advised to exercise due diligence when sourcing forex on the black market.
Late last year the Zimbabwe Republic Police issued a public warning of fake bond notes in circulation which had similar serial numbers. Several people have so far appeared in court over possession of fake money, largely bond notes and high denominations of US dollars.
National police spokesperson Assistant Commissioner Paul Nyathi warned fraudsters printing and circulating fake currencies that “the long arm of the law will soon catch up with anyone found on the wrong side”.
Efforts to get the Reserve Bank of Zimbabwe to comment on the scam last week were fruitless.
Using the law
The street invasion by illegal currency traders is still persisting despite the promulgation of legislation that criminalises trading of cash on the black market.
A Statutory Instrument (SI) 122A of 2017 — Exchange Control (Amendment) Regulations 2017 (No. 5) — gives the police power to arrest illegal money changers and seize whatever currency in their possession.
Under the law, offenders of illegal cash and foreign currency trading face a mandatory 10-year jail term, while their cash is forfeited to the State and their bank accounts frozen.
Counterfeiting poses a threat to a country’s economy and is a source of financial loss to citizens. Its other ill-effects include causing reduction in the value of real money and increase in prices due to more money circulating in the economy.
