Zimbabwe announces additional measures to tackle illegal forex deals and parallel market pricing

Zimbabwe’s Ministry of Finance and Economic Development Minister Prof Mthuli Ncube has announced measures, which he says are meant to curb illegal forex deals and parallel market price benchmarking.

The move comes as the parallel market has been raging. This has put the government under pressure even as it says that this is due to errant business practices,

This is part of the press release by Prof Ncube.

Recently, the central bank, working closely with the FIU have begun a process of identifying and prosecuting perpetrators of parallel market activities.

The initiatives by the central bank have full government support and my ministry will further strengthen the efforts as follows:-

1. The Zimbabwe Revenue Authority will be carrying out impromptu audits of corporate activities with a view of quantifying potential tax liabilities arising out of illegal foreign currency trading.

2. The Zimbabwe Revenue Authority will also be carrying out compliance Audits with respect to compliance with the Location Tax introduced during the 2021 fiscal year.

3. The FIU will continue to closely monitor and analyse financial transactions to identify, expose and take action against perpetrators of money laundering and other financial crime.

4. The capacity of the FIU and other law enforcement agencies to investigate and prosecute violations of the Bank Use Promotion Act, as well as various AMLCFT laws, will be enhanced.

5. Regulatory bodies including the Public Accountants and Auditors Board, will also be working on a framework to impose appropriate financial and professional sanctions on members of the accounting, auditing and other professions who may be complicit in superintending over illicit affairs by corporate entities which they are charged with running.

6. Business who disregard the law and continue price their goods on the parallel market rates will have their licenses suspended.

7. Members of the public are also strongly encouraged to report to the FIU and the National Economic Conduct Inspectorate, all business entities directly or indirectly benchmarking prices at parallel market exchange rates.

What this means

So the government is tightening regulations and compliance is gonna be heavy. Expect a call from your bank and make sure you have your papers in check.