FIU plots crackdown
LIVINGSTONE MARUFU
The Financial Intelligence Unit (FIU) is plotting a massive crackdown on businesses that charge exorbitant rates above the 10% margin of the official exchange rate in response to mounting concerns that speculative activity could destabilize the market, Business Times can report.
This mayhem of non-compliance has been brought on by the enormous difference between the official exchange rate, which is approximately ZWL$8600:US$1, and the parallel market rate, which ranges between ZWL$13000: US$1 and ZWL$15000:US$1.
A survey conducted by Business Times yesterday in the capital Harare revealed that the majority were charging more than ZWL$12000 for every US$1.
This demonstrates that companies are willfully breaking the 10% margin in order to weather the current financial crisis.
Oliver Chiperesa, director general of FIU, told Business Times that his organization was plotting a significant crackdown on business.
“Unfortunately, we now need to intervene again to arrest the indiscipline and speculative behavior.
“We now have to intensify our surveillance and enforcement activities which we had scaled back since December,” Chiperesa said.
He added: “All businesses found on the wrong side of the law will have their accounts frozen and will be penalised in terms of the law.”
Additionally, FIU will go after manufacturers who are held accountable for price hikes along the entire supply chain.
“Apart from errant retailers, we will be particularly targeting some manufacturers and wholesalers who are being reported to us by the public.
” Manufacturers and wholesalers sitting on top of the supply and pricing value chain are often guilty of triggering and fueling forward exchange rate setting, forcing retailers to do the same,” Chiperesa said.
He said over the last two months we have begun to see increasing levels of non compliance and indiscipline by traders (suppliers, wholesalers and retailers alike).
Although there have been legitimate variables influencing currency rates in recent weeks, a large portion of the volatility in exchange rates can be attributed to speculative activity and corporate profiteering, according to Chiperesa.
“We are aware of businesses and individuals who are always ready to take advantage of any slight movement in the rates to engage in forward exchange rate setting which is why you see some going as high as ZWL$13 000 and ZWL$15000,” Chiperesa said.
