The Criminal Investigation Department (CID) Asset Forfeiture Unit has obtained a warrant of search and seizure against Tetrad Investment Bank (TIB) management and directors in a case of fraud and money laundering.
The search warrant against the now-defunct bank and its directors was issued Thursday in terms of Section 50(1)(a) as read with Section 288 of the Criminal Procedure and Evidence Act (Chapter 9:07).
Tetrad was closed by the RBZ in December 2013 and was then placed in provisional liquidation in 2015.
In 2016, it was placed in final liquidation.
During its judicial management, a scheme of arrangement was devised to convert depositors’ funds and creditors’ dues into shareholding, with TCGT and directors taking control of the bank.
The matter involves money laundering as defined in Section 8 (1)(a)(b) of the Money Laundering and Proceeds of Crime Act (Chapter 9:24) and fraud under Section 36 of the Criminal Law (Codification and Reform) Act (Chapter 9:24).
The accused are:
1). the bank,
2). the bank’s directors: Harry John Orphanides, Misheck Mpiwa Chiwayo, John Alexander Brydone Graham, Michael Phillip Seton Gaisford, Andre Lourenco Vermaak and Appolinaire Ndorukwigira. Gaisford died while Ndorukwigira resigned a few days ago.
3). Tetrad Creditors Group Trust (TCGT) which converted depositors into shareholders.
TCGT claims to represent 70.71% of shareholders through proxies and uses this opaque structure to control the bank’s affairs.
TGCT is accused of refusing to allow an inspection of proxies that represent shareholders’ interests whom they claim to have.
The bank is now owned by its shareholders, not Tetrad Holdings as was the case before the debt-to-equity scheme of arrangement.
Lack of return on investment for eight years has fuelled a shareholders’ revolt at the bank whose directors are battling with the crisis as it spins out of control.
The shareholders are also complaining about the lack of audited financial accounts. They have not received audited financial accounts for the past three years. The last financials they received were qualified statements for 2018 which only came in 2022.
It is also believed that management and directors are benefitting from the bank’s diversified property portfolio from which they are receiving rentals, while equity stakeholders get nothing.
All this prompted Dimitri Divaris, son of the late modelling and fashion icon Kiki Divaris, to file criminal charges against the bank’s directors and TCGT.