FBC BANK LIMITED Versus ESTHER CHEKENYERE and RODRICK

1 HH 694-14 HC 3926/10

FBC BANK LIMITED versus ESTHER CHEKENYERE and RODRICK CHONGO and EDWIN MASIRIVHA and KUBATANA ORGANISATION and WESTON TIZORA and JOB MAROWA and REBEKA MATEKENYE and CRESTBERG ENTERPRISES (PVT) LTD and STUDMORE MUCHINERIPI and ADDMORE KARIMBA and DAVID MAGURAMENO and FLIPSIDE INVESTMENTS (PVT) LTD and CEPHAS MANDINGWA and MERCY CHAPUKIRA MAKANANI and PATRICIA GASSELER and GOLDEN CHEKENYERE and DZIMBANHETE CHEKENYERE and JOHNSON CHEKENYERE and ELDAH CHEKENYERE and CYNTHIA ZHOU and ROSEMARY CHANJAYANI

2 HH 694-14 HC 3926/10

HIGH COURT OF ZIMBABWE MATHONSI J HARARE, 11, 12, 13, 14, 18, 19, 25 November 2014 and 17 December 2014

Civil Trial

E. T. Matinenga, for the plaintiff N.P. Phiri, for the 1st, 15th, 16th 18th, 19th and 20th defendants The 2nd defendant in default The 3rd defendant, in person B. Mungure, for the 4th and 5th defendants The 17th defendant, in default The 21st defendant, in default

MATHONSI J: The plaintiff is a commercial bank which at the material time employed the first defendant as Branch Operations Manager, the second defendant as the Customer Services Officer and the third defendant as the Back Office Clerk at its Mutare Branch. The fourth, the fifth, the eighth, the eleventh, the twelfth, the fourteenth, the fifteenth and the sixteenth defendants were its customers who held bank accounts at the plaintiffs Mutare Branch with the eighteenth and twentieth defendants holding their accounts at the plaintiff’s Masvingo Branch. The sixteenth, the seventeenth, the eighteenth, the nineteenth, the twentieth and the twenty first defendants are said to be relatives or connections of the first and the second defendants formerly employed by the plaintiff as already stated, with the sixteenth and the seventeenth defendants being the first defendant’s brothers while the eighteenth defendant is her father. The twentieth defendant is said to be the first defendant’s sister in law and wife of the seventeenth defendant. The twenty first defendant is the second defendant’s sister. On 11 June 2010, the plaintiff sued out a summons against the 21 defendants claiming a total of US$1 505 122-00 against the various defendants which money it alleged was fraudulently removed from it through the medium of bank accounts held by some of the defendants. In due course, the plaintiff withdrew its claims against the sixth, the seventh, the eighth, the ninth, the tenth, the twelfth, the thirteenth, the fourteenth and the fifteenth defendants but persisted with claims against the balance of the 12 defendants. 3 HH 694-14 HC 3926/10

In its declaration the plaintiff averred that on various occasions during the period extending from 21 September to 31 December 2009 the first, the second and the third defendants, acting in concert generated false documentation misrepresenting inter alia that there were incoming funds being transferred by way of Real Time Gross Settlement System (RTGS) or that there had been transfer of funds between accounts and that way credited the accounts of the fourth, the fifth, the eighth, the eleventh, the twelfth, the fourteenth and the fifteenth defendants with various sums of money. Those sums of money were then withdrawn from the various accounts thereby fraudulently causing the plaintiff to suffer loss in the sum of US$1 505 122-00. The plaintiff averred further that the first defendant generated the false documentation that the funds were being transferred into the accounts. In their capacities as customer services officer and Back Office Clerk respectively, the second and the third defendants oversaw and authorized the false documentation and either themselves or through their subordinates, made entries in the plaintiff’s computerized system that the accounts were credited with the specific sums of money. On their part, the fourth, the fifth, the eighth, the eleventh, the twelfth, the fourteenth and the fifteenth defendants, knowingly and intentionally, with the connivance of the plaintiff’s 3 employees, removed the money belonging to the plaintiff by making withdrawals. Using that modus operandi the first, the second, the third and the fourth defendants, misrepresented that the fourth defendant’s account was credited with US$885 760-00 when it was not which they then removed. The first, the second, the third and the fifth defendants misrepresented that the fifth defendant’s account was credited with US$52100-00 when it was not, which amount they fraudulently removed. The first, the second, the second and the eighth defendants misrepresented that the eighth defendant’s account had US$432 670-00 credited which amount they removed. The first, the second, the third and the eleventh defendants misrepresented that the eleventh defendant’s account had US$16 792-00 in credit when it was not and they removed that amount. The first, the second, the third and the twelfth defendants misrepresented that the latter’s account was credited with US$72 000-00 before fraudulently removing it. The first, the second, the third and the fourteenth defendants misrepresented that the latter’s account had a credit of 4 HH 694-14 HC 3926/10

US$23 900-00 which they fraudulently withdrew. The first, the second, the third and the fifteenth defendants fraudulently withdrew US$22 100-00. The plaintiff averred further that the sixteenth defendant, received stolen money from the first, the second and the third defendants and used US$180 000-00 to purchase stand 259 Mandara Township of Lot 3A Mandara Harare. The seventeenth defendant received US$7 700- 00 of the stolen money and also, in concert with the nineteenth defendant, he purchased stand 180 The Grange Township of The Grange, Harare for a sum of US$120 000-00 of the stolen money. The eighteenth defendant received US$56 100-00 of the money, while the twentieth defendant got US$45 100-00. Working in cahoots with the first, the second and the third defendants, the twenty first defendant purchased 2 immovable properties in Marlborough Harare and Seke, Chitungwiza as well and various items of furniture. The plaintiff premised its claims against the various defendants on fraud and on unjust enrichment and craved for judgment against the defendants in the various sums they allegedly siphoned from the bank and a declaration that the properties allegedly purchased from the proceeds of the fraud were so purchased and therefore executable. Alternatively the plaintiff prayed for damages of US$1 505 122-00 against the first, the second and the third defendants jointly and severally the one paying the others to be absolved. The action was contested by all the defendants except for the second defendant who, although he was served with the summons on 17 June 2010, did not enter appearance to defend. As I have said, the claims against the sixth, the seventh, the eighth, the ninth, the tenth, the twelfth, the thirteenth, the fourteenth and the fifteenth defendants have been withdrawn. This judgment henceforth focuses on the remaining defendants. In their joint plea, the first, the sixteenth, the seventeenth, the eighteenth, the nineteenth defendants denied conspiring to defraud the plaintiff. The first defendant denied having a hand in the generation of fraudulent transactions nor authorising them and stated that most of the transactions occurred while she was on leave. They all denied using the plaintiff’s money to purchase any property with the seventeenth defendant asserting that he is a business man based in the United States of America who used funds from his business to purchase property. The nineteenth defendant averred that she assisted the seventeenth defendant to acquire a house well knowing that the purchase price came from his business ventures. The sixteenth and the 5 HH 694-14 HC 3926/10 seventeenth defendants averred that although Stand 259 Mandara Township is registered in the former’s name, it was bought by and belongs to the latter. In his plea the third defendant denied generating any false information maintaining that senior officers of the plaintiff must have obtained his password and used it for fraudulent purposes without his knowledge. He also averred that some of the fraudulent transactions took place at a time which he was on leave. He took a swipe at the plaintiff for making “a reasonable error and for having poor corporate governance systems in place” which caused the loss. The fourth and the fifth defendants admitted in their joint plea that they held bank accounts with the plaintiff, but denied conspiring with any of the defendants to fraudulently remove money from the plaintiff and denied any knowledge that the bank employees were committing a fraud at the relevant time. They maintained that although aware that money was being deposited into their accounts by the second defendant who would then take it out again, they had no knowledge that this was fraudulent. The fourth and the fifth defendants admitted that cash withdrawals were made from their bank accounts at the request of the second defendant who claimed to own the money and had their authority to utilize the account for that purpose and that; “at the material times (sic) the second defendant would keep cash withdrawal slips for use in withdrawing some money from the fourth and the fifth (defendants’) accounts whenever they would have been credited with some funds”.

They averred further that they genuinely believed that the transactions were lawful and above board. They denied liability insisting that all the money withdrawn from their accounts “was taken by the second defendant who claimed to be his” (sic). The fifth defendant admitted that he signed the withdrawal slips although any withdrawals made were “by and at the instance of the second defendant”. They denied being unjustly enriched, as whatever amount was credited into their accounts was withdrawn “by and at the insistence of the second defendant who made good use of it”. The eleventh defendant pleaded that his account was abused by the plaintiff’s employees who made deposits and withdrawals from those accounts. If any fiddling with his account was done, such was an inside job with nothing to do with him as he did not connive with such employees. He denied receiving any money withdrawn from his account or removing any money from the plaintiff. 6 HH 694-14 HC 3926/10

The twentieth defendant also denied fraudulently removing any money from the plaintiff. She averred at para 30 of her plea that : “She however remembers withdrawing certain amounts at various intervals for personal use as well as at the instruction of her husband who is based in the United States of America (USA). She knew that her husband was in the business of importing trucks into Zimbabwe and that some money towards the purchase of such trucks was deposited into her account as her husband had no local account.”

The 21st defendant put the plaintiff to the proof that “the notes used to buy her own property were identified by the plaintiff” as being money withdrawn from the bank. She asserted that she bought the property using her own money. At the pretrial conference of the parties held before a judge the fourth and the fifth defendants made an admission:

“that the various sums of money indicated in the plaintiff’s summons and declaration as having been credited to the specific accounts were indeed credited to the accounts.”

Five witnesses testified on behalf of the plaintiff, namely Peter Chava, Rambai Micanzo, Job Marowa, Cephas Mandingwa and Tendai Leonard Nhari in that order. Peter Chava is currently the Senior Manager Retail Banking at the plaintiff bank and at the material time he was the bank’s Senior Forensic Auditor. He boasts of banking experience dating back to 1981 when he joined Standard Chartered Bank as a mere clerk rising through the ranks to attain the position of Branch Manager before leaving to join the plaintiff. He has held various positions in the banking business in his illustrious career including those of foreign exchange clerk, exchange control officer and teller, ordinary teller and chief teller. Chava painstakingly described the duties of a bank teller and those of an operations manager at a bank. Briefly the exerting job of a teller entails receiving cash and cheque deposits from clients and also receiving withdrawal instructions. In doing so, a teller is required to verify the information entered on the slip ensuring that the amount in figures tallies with the amount in words and that the signature of the client is authentic. In respect of withdrawals the teller is required to confirm that the client’s account is sufficiently funded for such withdrawal, before stamping the slip. 7 HH 694-14 HC 3926/10

If a client wants to make a cash withdrawal in addition to checking if the account is sufficiently funded, a teller is required to verify that the instrument is completed in accordance with procedure, to identify the presenter of the instrument by demanding the production of an identity card or passport. The verification process involves comparisons with information already contained in the bank’s computer system. The witness explained that there are certain withdrawal limits that obtain. For instance a teller is only allowed to process a cash withdrawal of $500-00 on his own but anything above that the teller would require the authority of a designated officer before processing the withdrawal. Before authorising such withdrawal the designated officer is procedurally required to repeat the verification process performed by the teller, that is, checking that the instrument is correctly filled, that the signature of the client is authentic, that the account is sufficiently funded and indeed that the presenter has been properly identified. Once satisfied, the designated officer can authorize such withdrawal by appending his or her signature at the back of the withdrawal slip. At the end of the day the teller is required to reconcile his deposits and receipts. Chava stated that during his lengthy banking career he has held the position of operations manager and is conversant with the responsibilities of an operations manager who is responsible for the day to day operations of the bank, staff management, is a co-custodian along with the branch manager, of the branch assets. In discharging those duties, the operations manager must satisfy himself or herself that all transactions that have gone through the branch are authentic. There are control reports that the operations manager verifies. He explained that the function of a branch manager is basically that of relations officer. The branch manager is the senior custodian of assets with oversight responsibility on the operations manager. Regarding the operations manager, that official checks and authorises all cash withdrawals above the teller’s withdrawal limit at the time of withdrawal. The operations manager will also check all the withdrawals, that is, those below and above the teller’s limits the following day meaning that those withdrawals above the limit are checked by the operations manager twice. On the use of passwords, Chava testified that when an employee is engaged by the bank, such employee is made to sign a certificate of compliance confirming that they would have read and understood the guidelines on computer usage undertaking to abide by them at all times and 8 HH 694-14 HC 3926/10 confirming that they would take full responsibility and accountability for transactions made under such employee’s password. The operations manager will then seek authority from the bank’s information technology (IT) department to open a user identity for such employee. Information technology will then create a user and advise the operations manager that a user has been created. The system will then compel the user to change his or her password creating his or her own in the process. Once so created the password becomes a secret of the user falling under the provisions of the certificate of compliance the employee would have signed. There is no way an employee can retain a default password as the system forces you to change it before use. No one else will know your password unless the user compromises it by giving it to another person which would be extremely irregular and an act of misconduct. For that reason all employees at the plaintiff’s Mutare branch including Edwin Masirivha, the third defendant, had individual and private passwords known only to themselves. It is therefore untenable for the third defendant to say that his password was abused by another employee of the bank. That would only happen if he had compromised his password by disclosing it to that employee against standing rules which prescribe that under no circumstances should a password be disclosed to someone else. Doing otherwise is in fact a dismissable act of misconduct. Chava also explained how the bank’s vault is operated. It is where the bulk of the bank’s cash is kept and would be used in the event that a large sum is being withdrawn, the teller has no such amount in his or her till and cannot obtain it from the chief teller. The chief teller is the only teller who can access the vault and he or she is a co-custodian of it along with the operations manager. The two of them still cannot access the vault on their own. They need the assistance of a third person, called an independent custodian. The procedure is that once a requisition for cash from the vault is made to the chief teller, he or she would approach the operations manager. The two of them together with the independent custodian would then approach the vault. Using their different respective key combinations the three would open the vault for the chief teller and the operations manager to access the cash while the independent custodian watches. Even that transaction at the vault has to be checked again by the operations manager the following day. Peter Chava stated that he conducted the audit of the Mutare Branch in February 2010 which unearthed the fraud that was perpetrated at that branch and compiled the Forensic Audit 9 HH 694-14 HC 3926/10

Report which is annexed to exh 1, the record of court proceedings at Mutare Magistrates Court in which the first, the third, the fifth and the eleventh defendants herein where charged with fraud in contravention of s 136 of Criminal Law Code [Cap 9:23]. They were found not guilty and acquitted at the close of the state case after that court had opined that the state had not, at that stage, proved a prima facie case upon which they could be put to their defences. Chava explained the procedure of RTGS transactions pointing out that if an RTGS is coming from another bank the funds are received by the plaintiff’s treasury division at Head office. It is Head Office therefore which credits the funds to the respective beneficiaries at the plaintiff bank. At the end of the day Head office’s treasury division would generate a report of all inward RTGS transactions received and send it to the various branches. When that report is received at the branch the operations manager is required to check RTGS transactions appearing on the report against the daily transaction journal when attending to it the following day as she is required to do. According to that procedure the RTGS transactions which appear on the forensic audit report should not have been captured by any of the employees at the branch, in this case the second and the third defendants. It was an anomaly which should have raised eye brows and therefore picked by the operations manager during her daily checks. Having picked the anomaly, she should have investigated. The fact that she did not pick it at all for a period of more than 2 months means that she was either not doing her work at all or was complicit to the fraudulent activities being perpetrated. The witness went through the forensic audit report which he authored following the audit that was conducted and stated that although he has an audit file containing all the information which was at hand, the report contains his findings. Regarding intra-bank transfers he explained that these are done when a client comes to the bank wanting to transfer funds from one account to the other. The client would then complete an instruction to that effect. The instruction would be verified by the supervisor before he or she takes it to the operation manager for approval. Once approved, the data input clerk would then enter the transaction by debiting the client’s account and crediting the beneficiary account. Such a transaction cannot be processed without the client’s instruction which forms the source document. 10 HH 694-14 HC 3926/10

According to the witness’s audit report, during the period extending from 1 September 2009 to 31 December 2009 the first, the second and the third defendants were crediting and authorising fictitious deposits, fictitious in the sense that no funds would have been brought to the bank, into various accounts. The funds so created would thereafter be withdrawn from the bank either in cash or by transfers. The accounts involved belonged to Kubatana Organisation, the fourth defendant, which was credited in the total sum of $885 760-00, Weston Tizera, the fifth defendant whose account was credited in the total sum of $52 100-00, Crestberg Enterprises (Pvt) Ltd, the eighth defendant, whose account was credited in the total sum of $432 670-00, David Magurameno, the eleventh defendant, was credited with $16 792,00 Flipside Investments (Pvt) Ltd, the twelfth defendant, was credited with a total of $72 000-00, M. Chapukira’s account was credited with $23 900-00 and Patricia Gaseller, the fifteenth defendant, was credited with $22 100-00 giving a total of $1 505 022-00 being claimed by the plaintiff. Chava stated that although some of the transactions were in putted at a time when the third defendant was officially on leave, the total amount attributable to him when he was officially at work is $682 900-00 in respect of both RTGS transactions and transfers. All those transactions would have been verified by the second defendant and the first defendant would procedurally check them on a daily basis. He state that there were occasions when the first defendant was on leave during which time the second defendant would deputise her. Surprisingly, even when she was back at work, there were instances when the second defendant continued to act on her behalf. According to the first defendants leave application forms, pages 109 and 110 of exh 2, she was supposed to be on leave firstly from 10 November to 22 November 2009 and secondly from 2 December to 19 December 2009. Chava spoke of the plaintiff bank’s policy referred to as the “know your customer” policy meaning that bank employees were required to familiarise themselves with the personal details of customers to know the customers personally, familiarise themselves with the customers bank accounts including the details thereof contained in the bank’s system. They would also keep a check on the customers’ accounts and note the transactions going through especially where huge sums were coming in and out of those accounts. It is a policy which was implemented in conjunction with anti-money laundering rules, to ensure that customers’ accounts were not utilised for money laundering purposes. If the first, the second and the third defendants were 11 HH 694-14 HC 3926/10 implementing the know-your-customer concept and at the same time being mindful of the anti- money laundering rules, they would have been aware of the suspicious transactions going through the various accounts which were used as vehicles of fraud, especially as some of those accounts had been virtually dormant immediately before they were heavily used to siphon out money. If they had done their work diligently they would have raised a red flag against the demonstrably suspicious transactions. They did not. For instance, the audit uncovered that Kubatana Organisation operated two bank accounts with the plaintiff. One of its accounts was virtually dormant, p 66 of exh 2. That dormant account suddenly became hyper-active as from 15 October 2009 and it was through that dormant account that a total of $885 760-00 was created as a credit before being siphoned out. The first defendant, as operations manager, would have picked up the anomaly and reported it. Instead of doing that she actually authorized huge cash withdrawals from that account like the $30 000-00 taken out on 31 December 2010 and another of $10 400-00 made on 29 October 2010 a clear indication that she was aware of the fraudulent activity occurring in that account. Of course the bulk of the withdrawals from that Kubatana Organisation’s account were either authorized by the second defendant or not authorized at all. Some had vouchers missing. An unauthorized withdrawal would be irregular as it would be against the banks procedure manual. Again it would be easily picked by the first defendant during her daily checks. That way all the money fictitiously deposited into the account of Kubatana Organisation was withdrawn or transferred. The audit report shows that a total of $122 500-00 was transferred from that account by the second and the third defendants into the accounts of Johnson Chekenyere ($30 000-00), Crestberg Enterprises (Pvt) Ltd ($7 000-00) whose managing director, David Magurameno is the eleventh defendants, Weston Tizora ($41 000-00), Cynthis Zhou ($39 000-00) Golden Chekenyere ($5 200-00) and Bonda Children’s Home ($300-00). It was also uncovered that Johnson Chekenyere is the 81 year old father of the first defendant into whose account the first defendant deposited cash in the sum of $15 100-00 on 29 October 2009 and a sum of $30 000-00 was transferred from the Kubatana Organisation account into his account on 18 November 2009. In addition Dzimbanhete Chekenyere, the seventeenth defendant, is a brother to the first defendant who is a polygamist, he being married to both Florence Nakazwe and Cynthia Zhou. The former was the beneficiary of telegraphic transfers from the accounts of Johnson 12 HH 694-14 HC 3926/10

Chekenyere while the latter also benefited from transfers from the accounts of Johnson Chekenyere, Kubatana and Crestberg. Golden Chekenyere is another brother of the first defendant who received transfers from Kubatana and Crestberg accounts which he promptly withdrew in cash. Other individuals related to or connected to the first defendant who received money are Chola C. Nakazwe, ($14 000-00) and Sophie Zwizwai (£500-00). In respect of Crestberg Enterprises (Pvt) Ltd, the eighth defendant, Chava’s audit report reveals that the second and third defendants credited its bank account with a total of $432 670-00 through fictitious, ex-Kingdom Bank RTGs transfers and fictitious intra-bank transfers. Cash withdrawals were then made from that account in large amounts which were approved by the first and second defendants as well as Dumisani Nkomo while one withdrawal of $15 200-00 had a missing vouchers and one of $35000-00 made on 8 December 2009 was not authorised. Funds were also transferred from that account to the benefit of the eleventh defendant ($13 000-00), Cynthia Zhou ($5 100-00) and Golden Chekenyere ($2 500-00). It would be recalled that Magurameno claimed that he is a relative of the second defendant. It is therefore remarkable that funds were crossing each other between the relatives of both the first and second defendants. That is certainly not without a reason. Chava stated that the second and third defendants made fraudulent deposits totaling $72 000-00 into the otherwise dormant account of Flipside Investments, whose managing director is Cephas Mandingwa. These took the form of non-existent ex-Standard Chartered Bank RTGS transactions. Again the so-called RTGS transactions would have been patently irregular as the witness explained earlier. They would easily be picked out by the first defendant during her daily checks. She did not pick them. The withdrawal slips used to remove the money were also irregular in that they do not have an indication as to who the teller encashing them was. They would not pass through the operations manager in that form. He added that, even to the untrained eye, the signatures on the withdrawal slips were clearly not of the authorised signatories in terms of the signature card on the plaintiff’s system. They were forgeries but such forgery did not stop the teller Micanzo and the first defendant who authorised the two withdrawals of $22 000-00 and $26 400-00 from letting the money out. The other withdrawal of $22 000-00 was also irregular in that it was not even authorised. 13 HH 694-14 HC 3926/10

The personal account of Weston Tizora, the fifth defendant, was also the recipient of a handsome total sum of $52 100-00 although immediately before that it had been languishing in the doldrums with a balance of only $3-00. It is the second and the third defendants who credited it. Any diligent bank employee would have queried why a personal account was suddenly loaded and the deposits being quickly withdrawn, in addition to the obviously irregular so-called ex- standard chartered bank RTGS transaction. Even those funds allegedly transferred from other accounts were not supported by client’s instructions as required by the procedure manual. Withdrawals in cash were then made from that account, with the first defendant authorising two of them while the second defendant authorised 3, Catherine authorised one and two were without authorisation. A sum of $5 200-00 was transferred from Tizora’s account to Patricia Gaseller, the fifteenth defendant. $900-00 was transferred to Elspack Farming (Pvt) Ltd. Telegraphic transfers totalling $33 000-00, were also made to beneficiaries in the diaspora who included Florence Nakazwe ($15 000-00) a relative of the first defendant. The witness reported that the account of Gaseller benefited in the sum of $22 100-00 fraudulently transferred by the second and third defendants. In addition, a fictitious transfer of $5 200-00 was sent to it from the account of the fifth defendant before all the money was withdrawn on 17 and 29 December 2009. Mercy Chapukira is a rural client of the bank who was encouraged to open an account by the first defendant who was said then to have been a patient of her mother who was a traditional healer. Her under utilised account was soon put to better use after the second and third defendants credited it with a total of $23 900-00 in fictitious RTGs transactions and transfers from other accounts. Cash withdrawals were made between 21 September 2009 and 2 December 2009 which were approved by either the first or the second defendants, with one voucher missing, obliterating the deposits. The personal account of David Magurameno also found itself with a total credit of $16 792-00 which came in the form of ghost intra account transfers and one ex-standard chartered bank RTGs at the hands of the second and third defendants. The money was also systematically removed from the bank. Peter Chava described how a telegraphic transfer is effected stating that it all starts with a customer completing a telegraphic form showing the beneficiary bank and the amount to be 14 HH 694-14 HC 3926/10 transferred before signing the form. The instruction is handed over to the information officer or customer services officer who verifies that it is completed properly and also verifies the customer’s signature on the instruction before handing it over to the operations manager. The latter is required to satisfy himself or herself that the instruction is in order before approving that the telegraphic transfer be effected. The instruction is handed over to the back office clerk for capture into a pre-defined template. He would also debit the client’s account. After that the instruction is forwarded to head office to effect the transfer. Looking at the telegraphic transfers made in this case, as operations manager, the first defendant would have been aware that her 81 year old father was transferring money to her sister in law in Dallas USA for “family upkeep” because she scrutinised the telegraphic transfer before approving it. She would also know that the fifth defendant was transferring $9000-00 to her sister in law in USA to fund her family upkeep. The witness also confirmed that application was being made against the second defendant for default judgment. Under lengthy cross examination the witness stuck to his evidence maintaining that they have an internal query resolution system which was used to gather the information that had gone through the system during the forensic audit. They examined all the RTGs transactions, vouchers, withdrawal slips, the daily transaction journals, transaction reports from treasury, leave forms, hand-over take over reports and so on all of which gave an audit trail. The source of the fraud pointed to the first, second and third defendants. Chava took the view that the first and third defendants were liable only for the fraudulent transactions which occurred when they were at work and not on leave. However, the third defendant would still be liable for loss occasioned by his compromising his password. He stated that the other defendants still being sued are liable for allowing their accounts to be used fraudulently and also receiving stolen funds some of which were used to purchase properties which should be declared executable. The testimony of this witness was straightforward supported by documentation, it was easy to follow and his demeanor was excellent. One is left with no doubt that he is a truthful witness. 15 HH 694-14 HC 3926/10

The second witness to testify on behalf of the plaintiff was Rambai Micanzo who, at the material time, was employed as a chief teller, he later conceded under cross examination that he was an acting chief teller. He corroborated the evidence of Peter Chava in material respects including the aspect dealing with the duties of a teller and a chief teller as well as the procedure for using the vault, in particular that there are 2 custodians of the vault namely the chief teller and the operations manager who are overseen by a third and independent custodian. All of them have different key combinations to the vault and need one another to access the vault. As chief teller, Micanzo stated that he was one of the custodians. He recalls that on 28 October 2009 the third defendant brought to him a withdrawal slip for $22 000-00 for Flipside Investments (Pvt) Ltd and told him that he had been sent by the first defendant for the encashment who had indicated that the client had left it with her and would return later to collect the cash from her. Micanzo stated that he checked the slip and endorsed on it the letters “SV” meaning signature verified before affixing the date stamp and forwarding the slip to the first defendant for authorisation as the amount was above his limit. When the first defendant had authorised the withdrawal the 2 of them proceeded to the vault to count the money as he did not have such cash with him. After counting the money he left it with the first defendant, he never saw the client on that day and is not aware whether the money was eventually handed over to the client. Micanzo went on to say that he did the same with the other 2 withdrawals for Flipside Investments (Pvt) Ltd for $26 400-00 on 3 November 2009 and $22 000-00 on 26 November 2009. He denied that the first defendant was on leave on 3 November 2009 maintaining that if she had been she would not have authorised the withdrawal made on that date. He conceded that the signatures on those withdrawals appear different from those on the signature card explaining that as they had been presented to him by the third defendant who had been sent by the first defendant he had not suspected anything amiss with them. On the eighth and eleventh defendants the witness stated that he knew them very well a clients of the plaintiff and he was very familiar with their accounts. As clients in the construction business their accounts transacted modest amounts which hardly exceeded $2 000-00. He was then surprised when at some point he observed that a transaction of $35 000-00 had gone through the account. This prompted him to inquire from the eleventh defendant as to what business he 16 HH 694-14 HC 3926/10 was then involved in which was giving him that much. He responded that he had won a tender to construct houses giving the impression that he was aware of the huge RTGs transaction’s coming from Wattle Company into the eighth defendant’s account. Micanzo said he took the issue up with the first defendant who also expressed surprise at the developments unfolding in that account. He however, does not recall what action the first defendant had said she would take about the issue as he left it in her hands. Under cross examination Micanzo confirmed the “know your customer” policy adopted by the plaintiff and explained that it allowed these known customers to leave withdrawal slips with the customer services manager for processing and to then collect the cash at a later stage to avoid queuing. He readily conceded that when he gave evidence at the criminal trial he had stated that he did not recall what had happened with the transactions of 28 October 2009. This was because he had earlier on queried with the public prosecutor certain contents of his statement. The prosecutor had brushed him aside saying that the disparities did not matter. As he was appearing in court for the first time and did not trust the public prosecutor after that discussion he elected to play it safe by insisting he had no recollection of what happened when in fact he had. Regarding the withdrawals which appear on the audit report as unauthorised, Micanzo stated that he would leave them with the operations manager who would promise to sign for the authorisation later he having encashed them in terms of verbal instructions from the operations manager, who at the time was the second defendant. He was surprised to discover later that they were not signed for authorisation. He again readily admitted that cashing withdrawal slips on verbal instructions violated the bank’s rules of procedure, and this usually happened on month ends when they were very busy and the second defendant would be pressing them to reduce the queues. These irregularities cost him his job. Micanzo was generally an impressive witness. I have considered the hiccup in the evidence that he gave at the criminal trial which tends to taint his credibility but I am persuaded by the explanation he has given for that indiscretion especially in light of the fact that the proceedings at the criminal trial appear to have been far from satisfactory. I therefore, accept his evidence. Job Marowa was another impressive witness. Although he has had his employment and eviction problems with the fourth and fifth defendants there is nothing to suggest that he falsified 17 HH 694-14 HC 3926/10 evidence. He was employed by the fourth defendant, an entity run and controlled by the fifth defendant, as a field officer on a fixed term basis. His contract has since expired but at the material time he was one of the 3 signatories to the fourth defendant’s bank account with the plaintiff. The other 2 were Weston Tizora, the fifth defendant and Rebecca Matekenya who was employed as a co-ordinator. Any 2 of them would sign for withdrawal of money from the fourth defendant’s 2 bank accounts. One of them would then proceed to the bank to withdrew the money. The fourth defendant is a non-governmental organisation (NGO) engaged in the commendable business of helping disadvantaged people in communities. It relies for its activities entirely on donor funding and although it received assistance from other donors like Transvaal Zimbabwe – Botswana Association and St. Johns in England church, its main and consistent donor was Oak Zimbabwe Foundation which however generally donated about $5 000-00 or less per month which money was deposited into the fourth defendant’s active account number 3035041310270. In fact an examination of that modest account shows that generally small amounts were transacted in it and Oak Zimbabwe consistently deposited a sum of $2 898- 00 every month. Of course there was the odd, presumably fictitious transfer of $12 500-00 on 5 October 2009, which was quickly withdrawn on 7 October 2009. During the period preceding the alleged fraud at the plaintiff’s bank the fourth defendant’s second account, namely number 6135041310358 had been lying idle and generally dormant as donors were not fond of using it. It had a zero balance. When the fraudulent activities began, that account became extremely active receiving large sums of money which were being withdrawn quickly. The witness denied that any of the stated depositors into that account were donors of the fourth defendant. These included Christian Care, Africare, CRS and Cadec. Marowa stated that while he had access to the bank accounts once after about 4 months the fifth defendant could access the accounts at any time and is the one who was dealing with the bank. He systematically went through the withdrawal slips used to remove money from the fourth defendant’s account confirming his signature and that of the fifth defendant where they were genuinely appended, confirming that of the fifth defendant where it was genuine and affirming forgeries of both signatures where such existed. He did not hesitate to exonerate the 18 HH 694-14 HC 3926/10 fifth defendant where he felt that his signature had been forged. He stated that he was made to sign blank withdrawal slips by the fifth defendant as they operated from out of Mutare and he was a field officer who was usually away. The fifth defendant insisted that this was for the convenience of making withdrawals when the need arose. The pattern which came out of that testimony is that large sums of money were withdrawn from the account using withdrawal slips where generally the fifth defendant had signed while in the majority of cases Marowa’s signature had been forged. Even where it was genuine he did not witness the withdrawal of the money as he signed blank slips. There are other withdrawal slips where both signatures were forged. Marowa stated that the fourth defendant was struggling to pay its employees as it had no money. In fact in December 2009, it had failed not only to pay salaries but also bonuses with the employees agitated by this. It was therefore surprising to them that in the afternoon on 22 December 2009 as they were having their Christmas party, the fifth defendant took delivery of a huge consignment of brand new items of furniture from Teacherz Furnitures. The employees of the latter company arrived in a lorry and off loaded bedroom suites, a plasma television set, generator, 2 deep freezers, 2 stoves (one gas and one electrical) and office furniture comprising a table, chairs, visitor’s chairs and lockable metal cupboard. He stated that the fifth defendant had also purchased a grinding mill which was later recovered by the police before delivery. Urged by other employees who were unhappy that the fifth defendant was busy purchasing all that property in one go when they had not been paid, the witness says he confronted the fifth defendant demanding to know the source of his sudden wealth. He told them that they should not be surprised at all because he had not used their employer’s money and challenged the witness in particular to go and check the bank account to see that there was no money. In fact a quick look at the account shows that on 23 December 2009 it had a credit balance of only $673-38 which was obliterated by a withdrawal of $680-00 made the same day leaving a debit balance of $6-62. This confirms the correctness of Marowa’s evidence. Marowa said that the fifth defendant told them that he had picked up a diamond in Chiadzwa which he had sold in Mozambique to make a lot of money. It is this money that he had used to purchase the property that was being delivered by Teacherz Furnitures. They believed 19 HH 694-14 HC 3926/10 him not knowing that there was a fraud taking place at the bank where the fourth defendants’ accounts were locomotives of it. As I have said Job Marowa was an impressive witness whose demeanor was excellent. He struck me as a truthful witness especially as he readily exonerated the fifth defendant where he felt he was not involved. I accept his evidence. Cephas Mandingwa is a director of Flipside Investments (Pvt) Ltd, the twelfth defendant, and was originally sued as the thirteenth defendant before the claim against him was withdrawn. He is involved in the business of manufacturing paint in Mutare. He stated that at some point they held a bank account with the plaintiff’s Mutare branch. He identified the signature card of Flipside Investments; p 49 of exh 2, confirming that he was one of the signatories thereof. At the time the account was abused, he had not used it for quite some time as it was dormant with a balance of $7-30 eaten away by bank fees. He was not aware of the 3 deposits of $22 600-00 on 28 October 2009, $26 500-00 on 3 November 2009 and $22 900-00 on 26 November 2009. He also did not make any of the cash withdrawals done on that account and none of his co-directors were involved in the withdrawals as the withdrawal slips were clearly forged. Even the identity numbers appended on them are unknown to him. The last witness to testify on behalf of the plaintiff was Tendai Nhari, a handwriting expert with impeccable qualifications, holding as he does a BSc Honours degree, a Master of Science Degree from the University of Uguandan. He has worked as a government forensic scientist from August 1980 to 1999, after which he became an independent scientist consultant where among other things he examines questioned documents. He has been giving evidence in this court as well as in the lower courts as an expert witness. He has had a stint with the Commonwealth Fund for Technical Science for 9 years and is credited with setting up the Namibian Science Laboratory serving there as the government special advisor in forensic science for 4 years. He has practiced forensic science in the UK, Sweden, Canada and America. In short he passes as an expert witness. At the instance of the plaintiff he examined certain questioned documents in comparison with certain standard bank documents in order to ascertain whether there was common authorship. His conclusions are contained in forensic reports SL 10/11(A) and SL 10/11 together with illustrative diagrams pp 1 to 16 of exh 10. In the first report following an examination 20 HH 694-14 HC 3926/10 conducted on 15 June 2011 he drew the conclusion that the first defendant is the one who authored 12 cash withdrawal slips, 3 for Kubatana Organisation dated 27 October 2009 for $22 000-00, 30 December 2009 for $30 000-00 and 31 December 2009 for $30 000-00, a total of $82 000-00 withdrawn from Kubatana Organisation’s account. The expert concluded that the first defendant authored the 3 withdrawal slips for Flipside Investments dated 28 October 2009 for $22 000-00, 3 November 2009 for $26 400-00 and 26 November 2009 for $22 000-00, a total of $70 400-00 withdrawn from Flipside Investment’s account. He concluded further that the first defendant authored 6 withdrawal slips for Mercy Chapukira, the 4 that have been produced as exhibits are for a total sum of $18 400-00. Nhari also examined the standard handwriting of the second defendant on leave forms and compared it with withdrawal slips. He concluded that the second defendant authored 2 cash withdrawal slips for Kubatana Organisation dated 23 November 2009 for $35 000-00, 29 December 2009 for $35 000-00. The first defendant also authored the cash withdrawal slip for Crestberg Enterprises dated 9 October 2009 for $5 700-00, a total of $75 700-00. In respect of the 20th defendant, the expert concluded that she is the one who signed 15 of the 16 withdrawal slips in respect of withdrawals from her account while one withdrawal dated 29 December 2009 for $60-00 cashed in Masvingo is a forgery. It means therefore, that the 20th defendant is responsible for all the 15 cash withdrawals made from her account. The forensic scientist also examined 51 cash withdrawal slips and 1 cheque for Kubatana organisation. He concluded that the fifth defendant signed 44 cash withdrawal slips and 1 cheque. The fifth defendant’s signature was forged in respect of the rest. On Crestberg Enterprises, he examined 20 cash withdrawal slips to ascertain if, David Mugurameno, the 11th defendant, signed them. He concluded that indeed, Mugurameno signed 19 of the cash withdrawal slips while one withdrawal slip dated 9 October 2009 for $700-00 was forged. He found that the 11th defendant is the one who signed 10 cash withdrawal slips in respect of his account while the fifth defendant signed all the 11 cash withdrawal slips on his account. He also found that the first defendant had authorised the encashment of 8 cash withdrawal slips for Crestberg Enterprises, the 8th defendant, 3 for the 11th defendant, 3 for the 4th defendant, 2 for the 12th defendant and 2 for Chapukira the 14th defendant. 21 HH 694-14 HC 3926/10

Nhari stated that although he had been available, willing and able to testify at the criminal trial in Mutare, he was not invited. It is not clear why he was ignored when his findings as an expert were very crucial in the determination of the guilt or otherwise of the 4 accused persons in that matter. The evidence of Nhari was not challenged, it could scarcely be in the absence of another expert with contrary findings. At the close of the plaintiff’s case the 19th defendant made an application for absolution from the instance. Mr Phiri who appeared for her submitted that no evidence had been led against the 19th defendant regarding the alleged fraud. He stated that no assets were acquired or recovered from the 19th defendant to justify proceeding with the case against her. As there was no prima facie case established against her she was entitled to absolution. Mr Matinenga for the plaintiff opposed the application drawing attention to p 32 of exh 2, which was produced by consent of all the defendants present, which is an agreement of sale in respect of Stand 180 The Grange, Harare. The agreement of sale is between Sarah Melody Chijarira and Dzimbanhete Chekenyere, the 17th defendant, duly represented by the 19th defendant by virtue of a power of attorney. He submitted that evidence has already been led to the effect that when that property was purchased, the third defendant was sent by the first defendant from the plaintiff’s Mutare branch to go and deposit a sum of $60 000-00 into the MBCA bank account of Pam Golding Properties the estate agent undertaking the sale. To the extent that the purchase was being done by the 19th defendant ostensibly on behalf of his brother, she has to explain where the money came from. In deciding an application for absolution at the end of the plaintiff’s case the legal test to be applied is whether there is evidence upon which a reasonable man might find for the plaintiff: Supreme Service Station (1969) (Pvt) Ltd v Fox & Goodridge (Pvt) Ltd 1971 RLR 1 (AD) 5 D; Standard Chartered Finance Zimbabwe Ltd v Georgias & Anor 1998 (2) ZLR 547 (H) 552 G – H. In United Air Charterers (Pvt) Ltd v Jarman 1994 (2) ZLR 341 (S) 343 B – C GUBBAY CJ made the crucial point that:

“The test in deciding an application for absolution from the instance is well settled in this jurisdiction. A plaintiff will successfully withstand such application if, at the close of his case, there is evidence upon which a court, directing its mind reasonably to such evidence, could or might (not should or ought to) find for him.” 22 HH 694-14 HC 3926/10

In this matter the last leg of the plaintiff’s claim is to chase after the proceeds of a fraud allegedly committed by a number of defendants. Part of the money was allegedly used to purchase properties including that at The Grange in Harare where the 19th defendant acted as an agent. The evidence submitted by consent shows that she played an active part in the purchase and that half of that money came from the plaintiff’s Mutare branch. While it is claimed that the property was purchased by the 17th defendant it is remarkable that he has not seen the wisdom to come to court and defend himself and indeed his property as well as to explain the circumstances under which the purchase was made through the medium of the 19th defendant. There is evidence already that has been led upon which one may find for the plaintiff in respect of the property at The Grange. In the absence of the 17th defendant the 19th defendant should explain how and with what resources it was acquired. It would have been unsafe and indeed unwise to release the 19th defendant at that stage especially as there was still a need to interrogate the liability of the 17th defendant who was in default. For those reasons I dismissed the application for absolution. The first defendant also gave evidence. She was employed by the plaintiff in 1998 starting as a ledgers supervisor before being moved in 1999 to Centralised Operations Unit and became the operations manager in year 2000 a position she held until the events giving rise to this litigation unfolded. She confirmed the evidence led on behalf of the plaintiff that her duties involved monitoring staff, controlling the sundries account, being the co-custodian of the vault where cash is kept and controlling bank tellers. Regarding tellers, she stated that she had the responsibility of ensuring that they performed their duties properly, that accounts were balancing, that they got their cash properly and that they followed laid down procedures when processing cash withdrawals. She corroborated the evidence of both Chava and Micanzo on the procedure for cash withdrawals confirming that any cash withdrawal above the $500-00 limit required her authorisation. She however tried to down play her oversight responsibility by saying that she gave authorisation only after interrogating the teller as to whether he/she was satisfied with the signature and positively identified the customer, an explanation which makes nonsense of the need for checks and balances in the process. 23 HH 694-14 HC 3926/10

The witness also confirmed the procedure of withdrawing cash from the vault as pointed out by the witnesses for the plaintiff. She however stated that the chief cashier was Shamiso Severa and not Micanzo. She went on to say that during the period extending from 10 November to 22 November 2009 and the period 2 December to 19 December 2009 she was on leave. During those periods she was deputised by either the second defendant or Dumisani Nkomo. They would perform hand-over-take overs. She however confirmed the evidence of Chava that there were times when her deputy continued performing the duties of operations manager after she had returned form leave. She said this was in terms of instructions given by the branch manager. On RTGS transactions she confirmed the procedure as set out by the witnesses for the plaintiff especially that these were handled by head office and not by her branch. She stated that no officer at her branch was assigned to control them. Esther Chekenyere also confirmed the procedure for telegraphic transfers as stated by Chava including the fact that the information officer or customer services officer interfacing with a client desirous of making a telegraphic transfer was required to bring the form to her as operations manager for authorisation. The transfer would only be done after her authorisation, after which the form would also be signed by the branch manager, she would then hand the form to the back office clerk for processing whose processing is also authorised by his supervisor. The witness also confirmed that the responsible authorities at the branch were herself, the operations manager and Gibson Nyamutswa the branch manager at the relevant time. She also confirmed the know-your-customer policy as explained by the witnesses for the plaintiff adding that the policy was applied to selected customers who were given preferential treatment. They would not stand in the queue but were served by customer services officers. However the procedure of encashment was always the same even for these customers. She corroborated the plaintiff’s evidence that her subordinates referred withdrawals by these special clients to her and she would authorise them before sending the third defendant to bring the cash to her and leave it with her. The first defendant denied crediting the account of the fourth defendant with fictitious deposits or any account for that matter stating that she did not even suspect any fraudulent 24 HH 694-14 HC 3926/10 activities on the accounts. She however confirmed the plaintiff’s policy that no voucher was supposed to go missing and that if it did she as the operations manager was responsible. The witness however denied defrauding the plaintiff in any way although accepting that she authorised most of the fraudulent transactions. She denied being unjustly enriched maintaining that she remains very poor. She denied using stolen money to purchase properties with her relatives. Surprisingly she admitted making a deposit of $15 100 into the account of her father, the 18th defendant, which she says was given to her by her brother Dzimbanhete, the 17th defendant. This is a deposit that has not only been shown to have been fictitious with no supporting voucher, it has also been disowned by her father who said he knew nothing about it and did not transact on that account as appears on the records. She admitted that she had a duty as operations manager to raise a red flag on suspicious transactions in accounts but says she did not observe anything suspicions even though there were many discrepancies in the accounts like unauthorised withdrawals, forged withdrawal slips and forged signatures. She stated that her brother, the 17th defendant, is based in USA and is in the business of buying and selling haulage trucks as well as dealing in gold, a story parroted by all members of her family none of whom could even give an address where such business is conducted and where the haulage trucks and kept. Even though all of them have bank accounts which were generally dormant before the fraudulent activities commenced, the 17th defendant surprisingly does not have one when he is the one who is alleged to have an unlimited fountain of money. She stated that when the 17th defendant was in Zimbabwe for 7 months during the year 2009 before returning to the USA in November 2009 he gave her cash in the sum of $110 000-00 and asked her to look for and then purchase a house on his behalf. It is not clear why he could not do so himself during the lengthy period of 7 months and why he kept such large sums of money without banking them. She succeeded in buying the property in Mandara, Harare. The first defendant’s world collapsed when she was subjected to cross examination. She admitted that she held a position of trust, was required to work for the benefit of the bank, to show the utmost good faith and that if she failed she would be personally liable. She admitted signing a bundle of documents produced as exh 7 in which she certified that all computer users had read and understood the guidelines relating to the use of passwords, she certified that all her 25 HH 694-14 HC 3926/10 subordinates had read and fully understood the rules relating to the handling and movement of cash, that procedure manuals were read and understood by her subordinates, that her tellers understood instructions, that she checked to ensure that all processed batches for each working day were being authorised timeously, that all General Ledger Accounts under her control were not being put to wrong use and that there was no blind authorisation of transactions. All the requirements that she certified appear to have been violated when the fraudulent activities set in. The first defendant accepted liability for improper transactions which occurred while she was on duty but denied liability for those which occurred while she was on leave, even though she signed accepting responsibility for all the relevant months. She could not explain how the fraud occurred under her watch if she had been following the procedures as she certified. She confirmed the evidence of the plaintiff that as incoming RTGS transactions are generated from head office one cannot have members of the Mutare branch appearing in the records as having processed an RTGS. However the audit exposed that to have happened under her watch and she admitted that clearly the second and third defendants were cheating saying she only became aware of it after her arrest. The first defendant made the surprising argument that she was under no obligation to check clients’ accounts in respect of RTGS transactions despite the certifications she regularly signed and her overall responsibility for the activities at her branch. She confirmed the evidence of Mandingwa that they went to school together asserting that Mandingwa would not have any reason to lie against her. Mandingwa’s Flipside account is one of those targeted and used as a locomotive for the fraud and he never made the deposits nor the withdrawals in question. It should be recalled that the handwriting expert concluded that the first defendant is the one who singularly authorised all the Flipside Investments cash withdrawal slips. Significantly another account which was targeted for use was that of Mercy Chapukira who was encouraged by the first defendant to open an account and her mother was the latter’s traditional healer. Again a person close to the first defendant had her account abused in the fraud. It is also remarkable that the handwriting expert concluded that 2 of the Chapukira cash withdrawal slips were signed by the first defendant. Rocket Science is not required to see that she was a vital cog in the fraud. 26 HH 694-14 HC 3926/10

I also found the first defendant’s story about the 17th defendant, her very own brother, to be a sickening fabrication. She would have us believe that his brother would come to Zimbabwe from USA, spend 7 months during which he made loads of money which he did not bother to bank but moved around with. He would leave her with $110 000-00 to buy a house instead of buying it himself and choosing one himself. He would not open a bank account. Although he runs a successful trucking business none of the family members knows where it is located and none of them, except for his second wife Zhou knows his address or telephone. This is a man who, although clearly aware of the court action, has elected to stay away and not come to defend his fortune. She would also like us to believe that she did not see the wisdom of advising him of the court case because of an imagined family feud which only started in March 2014. Of course we know from the testimony of the 20th defendant that the 17th defendant was in this country from December 2013 to June 2014 and that he is perfectly aware of these proceedings but has chosen to boycott them. Clearly therefore the first defendant, and indeed the rest of the Chekenyere family including their shameless 81 year old father, are accomplished liars, dishonest people right through 2 generations. I have no hesitation whatsoever in rejecting the evidence of the first defendant who was a hopelessly poor and visibly untrustworthy witness. I am persuaded that she defrauded the plaintiff working in close liason with other employees of the bank and used some of the proceeds to purchase 2 properties in Harare in the name of the 17th defendant who, because he knows he has no interest whatsoever in them, has found it unnecessary to come and contest the action. Although Chava appeared to suggest otherwise, I agree with Mr Matinenga that when the initial fraud was committed, when the fictitious deposits were created all the 1st , 2nd , and 3rd defendants were in attendance. Their being on leave at some stage does not exonerate them at all. The third defendant also gave evidence and his case boils down to simply that he did not defraud the plaintiff. Although he processed most of the transactions attributed to him, only a few were done while he was on leave and attending college at Midlands State University, he says he was not aware that they were fraudulent. As far as he is concerned the second defendant must have used his password to perform the transactions after his password had been compromised. 27 HH 694-14 HC 3926/10

He did not disclose his password to anyone not even the second defendant whom he alleges used it. The third defendant denied benefiting anything from the fraud insisting that all the transactions that he processed had been authorised by his superiors and he worked within his job description. He conceded that upon his engagement as a back office on 4 July 2007 he had signed a certificate of compliance for computer users which reads in pertinent part: “I Edwin Masirivha has read and understood the guidelines on computer usage which I undertake to comply with all the time. I confirm that I will take full responsibility and accountability for any transaction or therefore I undertake to keep my password------confidential.”

He confirmed that when he reported for duty the operations manager explained to him the importance of keeping his password confidential as it was the policy of the plaintiff that under no circumstances whatsoever should he disclose the password to anyone. Although he suspects that the second defendant compromised his password, he was unable to explain how and when. His was therefore a bare denial and an unsustainable accusation. What is undeniable therefore is that the third defendant is fully responsible and accountable for every transaction processed using his password or user identification. If he processed entries which were fraudulent using it, he is responsible and accountable for them. If someone else did that using his password, then it means that he compromised his password in breach of the procedure rules and the certificate of compliance which he signed. He would still be liable. In respect of the 3 Flipside withdrawal slips which were forged by the first defendant, the third defendant testified that on each occasion he was called by the first defendant to her office and she gave him the cash withdrawal slips and instructed him to take them to the tellers for encashment. He would leave them with the tellers. In respect of the RTGs transactions which he processed, we know of course that there were no RTGS transactions at all and there were no instruction documents and that staff at the Mutare branch had no business processing such transactions which were the province of head office. What they did was to create fictitious deposits under the guise of RTGS transactions. 28 HH 694-14 HC 3926/10

They did the same for internal transfers. The third defendant who processed them would have been aware of the fraud. The fifth defendant gave evidence on behalf of both himself and the fourth defendant, an NGO which he has taken over from its founder Sarah Henton. He immediately adopted the contents of the defence outline he had submitted in the criminal trial, not a wise move at all as he later contradicted the contents of the defence outline. For instance in his defence outline he had stated in paragraph 10 thereof that: “he was lent some money by this Chongo (2nd defendant) which amount he used to purchase one or two items and he estimates this amount to be in the sum of US$10 000- 00. He denies buying any of his property using stolen funds.”

It is not clear why he was estimating the amount of the loan which should have been known to him. We also know now that he did not purchase “one or two items” but quite a substantial number of items which were delivered in one day. More importantly in his evidence in chief, the fifth defendant states that he had obtained about $3 500-00 from donors to purchase office furnisher and used his own resources to buy personal property. He said he runs his own projects which give him money and works with churches as well and has personal donors. He never mentioned the loan from the second defendant. Under cross examination he shifted positions when he was reminded that Marowa had told the court that to them he had given a story that he had picked a diamond that he sold. He changed to say indeed that had happened but he had used the proceeds of the diamond to repay the loan. Weston Tizora was an unreliable witness. His demeanor was extremely had, he shifted, prevaricated, was incoherent and throughout his testimony he was unable to look straight. Even his narration was so disjointed that trying to make sense out of it would be an exercise in futility. What we know of course is that he authorised the second defendant to use the bank accounts of the fourth defendant as well as his personal account for fraudulent purposes. The reason that he gave for doing that is unacceptable because the second defendant would have used his personal account to do the transactions in question if they were legitimate. He must have known about the illegitimacy of the transactions and participated. I have already accepted the evidence of Marowa that during the fraudulent activities the fifth defendant suddenly became rich and bought substantial properties obviously from what he 29 HH 694-14 HC 3926/10 gained from the fraud. This is a person who could not point to any books of account of the fourth defendant justifying the source of the funds that he used to make the purchases. I have also accepted the evidence of the expert that the fifth defendant signed all the cash withdrawal slips transacted on his personal account meaning that he accessed the $24 598-00 withdrawn from his account. There is nothing to suggest that he was involved in the movement of money from that account in the form of outgoing transfers except that he had opened the floodgates by authorising the use of his account. On the Kubatana Account the same principle applies. The expert found that he signed 45 of the cash withdrawal slips transacted in that account; while his signature was forged on 6. The probability is that he was able to access the funds withdrawn using the slips that he signed. Even if he did not he must be held accountable by virtue of his signature appended on them. David Mugurameno told the court that he is a director of Crestberg Enterprises (Pvt) Ltd, the eighth defendants whose account was also heavily abused. He also ran a personal account which was also utilised in the fraudulent activities. The second defendant is his nephew who approached him requesting to use both accounts saying he had a friend who was in the United Kingdom who wanted to send money for construction and his trucking business. This was in sharp contrast with what he had put to Chava that the person in the UK was a relative of the second defendant. He had obviously changed his story by the time he gave evidence after Chava had expresses surprise at how, if indeed he was uncle to the second defendant, he had not known about such relative. He said that he authorised the second defendant to use the accounts. Each time there was money in the account the second defendant would call him and he would promptly make a withdrawal before handing all the money to the second defendant. Although he tried to dispute Micanzo’s evidence that his accounts generally transacted figures of less than $2 000-00 documentary evidence produced affirms that assertion. This witness must have known that his accounts were being used for fraudulent purposes and gave his blessing. The story allegedly given by the second defendant is far from satisfactory because if indeed the transactions were legitimate, he should have used his own account. The probability is that he connived with his nephew and aided the fraud. According to the expert, the eleventh defendant signed 19 of the 20 cash withdrawal slips used to remove money from the 30 HH 694-14 HC 3926/10

Crestberg account, only one, for $700-00, was forged. He also signed all the 10 withdrawal slips used to remove money from his personal account. He therefore accessed the total sum of $427 350-00 withdrawn through Crestberg and $28 330-00 removed through his personal account. But then, the plaintiff has made concessions on all that. Golden Chakenyere, the 16th defendant, Johnson Chekenyere the 18th defendant, Eldah Chekenyere, the 19th defendant and Cynthia Zhou the 20th defendant all gave evidence. In all fairness, other than the 20th defendant whose evidence had bits and pieces of the truth here and there the rest of the Chekenyere family members are dishonest people whose evidence was glaringly false that time should not he wasted on it. All of them pretended to know nothing about what happens in each other’s lives that one is left wondering if they belong to the same family. Golden and Eldah Chekenyere’s demeanour was so bad and their body language betrayed arrogance and disrespect of gigantic proportions. To them the whole exercise may have passed as a circus. Old man Chekenyere perhaps lends credence to the adage that age does not come with wisdom at times, it may come strolling alone. At the age of 81 one wonders why he would come all the way to shield his children from liability. Why he would want the court to believe that the 17th defendant bought a house (note that he says he bought one house instead of 2), using cash he had carried in a bag all the way from Harare to Masvingo and back merely to show it to his father when the house was bought in his absence by the 17th defendant’s siblings. To his credit the 18th defendant categorically stated that he had neither been given $15 100-00 by the 17th defendant through a deposit into his account, nor transferred any money from his account to his daughter in law in Dallas USA for family upkeep. It was all fictional deposits which were then removed by or under the watch of his daughter the first defendant. I have no doubt in my mind that the houses purchased in the name of the 17th defendant were purchased with ill-gotten money removed from the plaintiff bank. The use of the 17th defendant’s name was merely to disguise the otherwise illegitimate purchases. It is for that reason that the 17th defendant has not only failed not come forward to claim the properties but his relatives have been so keen to hedge him away from the court’s gaze. We know for a fact from the 20th defendant’s evidence that he was in the country for about 7 months from December 2013 to June 2014. 31 HH 694-14 HC 3926/10

He had ample time to claim the properties if they were his and to move for their transfer into his name. It makes no sense whatsoever that he and his young family would continue renting a flat in Avondale when they have more comfortable premises in Mandara and at The Grange. The 21st defendant was in and out of court. When the trial commenced she was not in attendance. She came in during the trial and showed little interest in the proceedings. She only had one question for Chava, that is, whether her late husband had left a pension. But then that was not the scope of this matter. She was sued on the basis that the second defendant stole money from the plaintiff and used part of it to purchase Lot 66 Marlborough Harare for $137 000-00 her benefit and that the second defendant also purchased Stand 20572 Seke Chitungwiza in her name. The 21st defendant is the second defendant’s sister. The claim against the second defendant is uncontested and his sister has also not come forward to dispute that she is the beneficiary of his fraudulent activities at the bank. From the evidence placed before me there is no doubt that the second defendant as well as the first and third defendants masterminded the fraud and benefited from it. I accept that part of the money was used to purchase the properties in the second defendant’s name. While it may be true that the plaintiff has targeted only some of the culprits, I agree with Mr Matinenga that in the case of joint and several debtors a creditor may select his target: Parekh v Shah Jehan Cinemas and Ors 1982 (3) SA 622; R.H. Christe; Law of Contract at p 249. In Industrial Equity v Walker 1996 (1) ZLR 269 (H) 286 E-F, BARTLETT J quoted with approval GREENBERG JA in R v Myers 1948 (1) SA 375 (A) at 382 who also cited Lord HERSCHELL’s remarks that: “Fraud is proved when it is shown that a false representation has been made (1) knowingly or (2) without belief in its truth, or (3) recklessly, careless whether it be true or false. Although I have treated the second and third as distinct cases, I think the third is but an instance of the second, for one who makes a statement under such circumstances can have no belief in its truth.”

I have already stated that the first, second and third defendants made the fraudulent misrepresentations by manipulating accounts and positing fictitious amounts. Against them fraud has been established. My assessment of the evidence also shows the other defendants who participated in withdrawing money from the plaintiff which they were not entitled to. In that 32 HH 694-14 HC 3926/10 regard my task has been made easier by concessions made on behalf of the plaintiff that fraud has not been proved against the rest of the defendants not employed by the bank. Mr. Matinenga, for the plaintiff conceded, correctly in my view, that, the plaintiff has only established a claim of $19 591-00 against fifth defendant (none against the fourth), $9 000-00 against the eleventh defendant (none against the eighth) and $20 300-00 against the twentieth defendant. The plaintiff has no doubt established a claim on the grounds of unjust enrichment against the sixteenth, seventeenth, twentieth and twenty-first defendants as the properties bought by them were bought from ill-gotten money. In the result it is ordered that:- 1. Judgment be and is hereby entered in favour of the plaintiff: (a) As against the first, second and third defendants jointly and severally the one paying the other to be absolved in the sum of US$1 505 122-00 together with interest at the prescribed rate from the date of summons to date of payment in full. (b) As against the first, second, third and fifth defendants jointly and severally, the one paying the others to be absolved in the sum of $19 591-00 together with interest at the prescribed rate from the date of summons to date of payment in full. (c) As against the first, second, third and eleventh defendants jointly and severally the one paying the others to be absolved in the sum of $9 000-00 together with interest at the prescribed rate from the date of summons to date of payment in full. (d) As against the first, second, third and sixteenth defendants, the one paying the others to be absolved in the sum of $7 700-00 together with interest at the prescribed rate from the date of summons to date of payment in full. In addition, Stand 259 Mandara Township of Lot 3A Mandara is declared to have been purchased with proceeds of fraud perpetrated against the plaintiff bank and is specially executable and the plaintiff is entitled to proceed with its sale. (e) As against the first, second, third and seventeenth defendants, it is declared that Stand 180 The Grange Township of The Grange was purchased with proceeds of fraud perpetrated against the plaintiff bank, and is specially executable and the plaintiff is entitled to proceed with its sale. 33 HH 694-14 HC 3926/10

(f) As against the first, second, third and twentieth defendants jointly and severally the one paying the others to be absolved in the sum of $20 300-00 together with interest at the prescribed rate from the date of summons to date of payment in full. (g) As against the first, second, third and twenty-first defendants it is declared that Stand Lot 66 of Marlborough Township of Marlborough and Stand 20572 Seke Township in the District of Goromonzi as well as four (4) double beds, one hover vacuum cleaner, 2 lawn mowers, an LG refrigerator, one Samsung refrigerator, one Whirlpool deep freezer, one Nova deep freezer, one six (6) piece blue sofa set, 22 inch plasma television set, two (2) 24 inch Natsui television sets, one 21 inch Samsung TV set, one bicycle, and one study table and swivel chair were with proceeds of fraud perpetrated against the plaintiff bank, are specially executable and the plaintiff is entitled to proceed with their sale. 2. The first, second, third, fifth, eleventh, sixteenth seventeenth, twentieth and twenty-first defendants shall bear the costs of suit jointly and severally, the one paying the others to be absolved.

Dube, Manikai & Hwacha, plaintiff’s legal practitioners Messrs Makombe & Associates, 4th , 5th, 6th and 7th respondents’ legal practitioners Muvingi, Mugadza & Mukome, 1st, 15th, 16th, 18th, 19th and 20th, respondents’ legal practitioners