BY STAFF REPORTER
A complex web of suspected tax evasion and underhand deals has been exposed following the opening of a shelf company in Seychelles by an ally of President Emmerson Mnangagwa.
During his stint as permanent secretary in the Ministry of Defence, Martin Rushwaya, together with Colonel Grey Mashava, allegedly opened a shelf company, Greatgem Cooperation, through a Russian law firm, Cliff Legal Services, which is the professional intermediary for the company.
Cliff Legal Services, Inc. whose given address is 36, bld. 3, Kutuzovsky Prospect, 121170 Moscow, contacted a Seychelles agent, Alpha Consulting to process the opening of the company.
Records of Rushwaya and Mashava’s offshore company are amongst a batch of 1,8 million files named the Pandora Papers, an anonymous leak of more than 11,9 million documents from the databases of 14 corporate service providers that set up and manage shell companies and trusts in tax havens around the globe.
The International Consortium of Investigative Journalists (ICIJ) is leading the investigation and has shared these files with over 600 journalists across the world in the biggest journalistic collaboration in history.
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According to the documents gleaned by The Standard, Rushwaya and Mashava opened the company on July 21, 2010 with the latter being the sole director.
Greatgem Corp was registered under company number 078147.
The other shareholder for Greatgem Corp is Gems Global Marketing.
It could not be established who is behind Gems Global Marketing.
The registered office of Greatgem Corporation was Suite 1, Second Floor, Sound & Vision House, Francis Rachel Str., Victoria, Mahe, Seychelles-the same as that of Alpha Consulting Limited, the company agent.
But the Greatgem book of accounts was held in Russia at the law firm, Cliff Legal Services.
With an initial capital of US100 000, the company activity was cited as ‘trading in special stones.’
The company had a bank account in Latvia.
However, a quick google search for the Cliff address showed a dingy, old building.
On its website, the company’s motto is, ‘We find the optimal solution’.
Services on offer on the website include legal services, international tax planning, legal services for businesses, audit, consulting, accounting outsourcing and business licensing.
In 2012, Alpha reported Greatgem as suspicious to Seychelles’ Financial Intelligence Unit when it discovered that the two directors are politically exposed persons (PEPs).
It could not be established whether Cliff Legal Services Inc, the Russian law firm that acted as the intermediary in opening Greatgem Corp, did not do due diligence on Rushwaya and Mashava or whether any oversight was intentional.
The FIU detected suspicious activity on November 28, 2012, but could not ascertain the amount involved in the transaction.
The overall trade that had happened and the return on revenue on Greatgem in those two years could not be ascertained.
The Financial Intelligence Unit (FIU), which monitors anti-money laundering and terrorist financing, wrote to Alpha Consulting Ltd, saying the transactions by Greatgem were ‘suspicious or corrupt’.
“While performing standard due diligence monitoring procedures Alpha Consulting came across the information, which shows and confirms that the shareholder of the company, namely Mr. Martin Rushwaya (as per the information we have) is most probably a politically exposed person, Ministry of Defense permanent secretary.
“According to internet publications he is listed as a director in the biggest diamond mining company Anjin Investment (Pvt) Ltd.
” Anjin has been described an intricate web of Chinese and Zimbabwean military networks and it was designed through front or nominee companies to camouflage the involvement of security forces.
“There are some other internet publications that say that there are off budget financing of the military and secret police and according to the Global Witness “it is a real danger of a shadow security state emerging with both monopoly on violence and secret sources of funding”
Both Rushwaya and Mashava declined to comment on the allegations.
The FIU said the transaction was reported as suspicious because of Rushwaya’s involvement in Anjin.
“As the registered agent for the company we express a great deal of concern that the above described situation might be linked to the corruption of the state high officials.
“The company was sold through a professional intermediary.
“ The company is affiliated with the three other Seychelles companies.
“We have done the world compliance check but there were no records found.
“ We hereby attach the copies of the relevant documentation as the copies of internet publication that were obtained in the process of investigation.”
“When submitting this report, please append any additional material that you may consider suitable and which may be of assistance to the Financial Intelligence Unit, i.e. statement, correspondence, vouchers, transfers, account opening and identification documents, etc.”
Greatergem Corporation was opened two years after a leading international diamond trading network, the Rapaport Diamond Trading Network-that connects thousands of some of the best diamond suppliers and buyers around the world banned members from trading in diamonds from Zimbabwe’s Marange diamond field in November 2009, citing concerns over “severe human rights violations” at the controversial field.
The US Customs and Border Protection (CBP) also blocked the import of rough diamonds mined from the Marange fields in Zimbabwe, claiming they were produced using forced labor.
Coded ‘blood diamonds’, other trading networks like the 70-member Kimberley Process, a grouping of diamond trading countries and civic society groups set up to prevent trade in conflict or blood diamonds, also banned trade of the Marange diamonds in 2009 before lifting the embargo in 2011.
Zimbabwe’s diamonds were tainted by the blood tag and buyers were either unwilling to buy them or offered low prices.
The army has been into diamond mining through Anjin, a joint venture between China’s Anhui Foreign Economic Construction Group (AFECC).
Anjin had previously mined in Marange and later returned to the area.
Alpha noted that media reports in 2012 named Rushwaya as the director of a Chinese-Zimbabwean diamond-mining company (Anjin) that allegedly “camouflaged the involvement of security forces” and was involved in “off budget” financing.
Alpha declared in its report: “We express a great deal of concern that the above described situation might be linked to the corruption’
Former Zimbabwean Finance minister in the government of national unity formed between the ruling Zanu PF and the opposition MDC , Tendai Biti, could have buttressed the claims by Alpha when he went on record to say that the treasury did not get much from diamond sales in Zimbabwe.
Late former president Robert Mugabe also claimed that US$15 billion worth of diamonds were stolen from the Marange diamond fields, a claim dismissed by his ruling party bigwigs-including Rushwaya, as unsubstantiated and exaggerated.
Besides Rushwaya and Mashava, other notable but controversial clients of Alpha Consulting include Isabel dos Santos, Angolan billionaire and eldest daughter of Angola’s former president, who became Africa’s wealthiest woman through inside deals awarded by her father’s government.
In January 2020, after an ICIJ investigation of dos Santos, Alpha submitted letters to the Seychelles’ Financial Intelligence Unit acknowledging that its client of seven years was under investigation in Angola.
In a follow-up letter to the agency, in March 2020, Alpha said dos Santos’ two companies remained clients. Alpha was the registered agent of dos Santos’ Seychelles companies.
Rushwaya, an advisor to Mnangagwa, has vast business interests across most sectors of the economy.
In 2007, he benefited from Zimbabwe’s central bank, the Reserve Bank of Zimbabwe (RBZ)’s Farm Mechanisation Scheme, where he got a loan of US$84 543, 00.
Rushwaya is now deputy chief secretary to the president and cabinet, while Mashava has retired from the military.
According to a 2017 report called ‘An inside job’ by the Global Witness, an organisation that tracks environmental and climate justice around the world, Zimbabwe’s securocrats and Zanu PF bigwigs have secretly benefited from the country’s diamond sector at the expense of the country without remitting the proceeds to the government.