Zifa settle Potraz million-dollar debt

By Staff reporter | 09 Jun 2020 at 18:25hrs
IT'S a debt which has been weighing heavily on ZIFA, for the past three years, and provoked a storm of controversy which spilled into both the High Court and Parliament. It left the country's Postal and Telecommunications Regulatory Authority having to fire-fight, on a number of fronts, to show they didn't do anything wrong when they agreed to bail out ZIFA.

The first occasion was the US$225 000 which POTRAZ paid to enable the country's football controlling body to send the Warriors to a 2017 AFCON qualifier in Conakry. And, after the team qualified for the 2017 Nations Cup finals in Gabon, POTRAZ again came to ZIFA's rescue, amid unrest in the Warriors camp, when players demanded to be paid before they left for the continental football showcase.

The stand-off resulted in the Warriors boycotting a send-off dinner, which had been organised in Harare, with players choosing to stay in their hotel rooms rather than attend the event. POTRAZ loaned ZIFA a further US$1 million.

According to the acknowledgement of debt, ZIFA requested the loan to facilitate travel, accommodation and participation costs of the Warriors in Gabon.

ZIFA had committed to clear the debt by January 1 last year. Sources revealed to The Herald yesterday the issue had now been resolved after ZIFA paid their dues in full.

"Remember the POTRAZ debt, which created quite a storm in the past few years, amid a number of accusations, with the issue even spilling into Parliament and the High Court?'' the sources said. "Well, that issue has been resolved after ZIFA paid that debt in full last week.

"The payment was just under $1,2 million and it brings an end to this saga which had created quite a number of negative headlines in the last few years.

"An organisation which came on board to help when they felt national interests were at stake, should the Warriors have failed to fulfil an AFCON qualifier and were thrown out of the tournament, was now being dragged to such institutions like Parliament to answer questions, including unfounded controversy.

"The damage it was inflicting was huge because the other organisations are always watching and, probably, asking themselves whether it was worth the trouble to come and help a national sport, like football when, at the end of the day, it leaves such Good Samaritans in the mud having to clear their names.'' ZIFA leaders were reluctant to discuss the issue yesterday but the sources said the country's football leaders have been clearing some of the association's huge debts.

"The POTRAZ case is just one of those which have been resolved,'' the sources said. "These guys (the ZIFA board) have been quietly settling some of their big debts in the past few weeks after they held a meeting and agreed they were not going to make any progress, as long as they were carrying huge debts.

"They kept finding out that, whatever they tried to do, they would run into problems because of the legacy debt and some of the debts they have accrued because good partners tended to distance themselves from such organisations.''

POTRAZ director general, Gift Machengete, confirmed to The Herald ZIFA had been paid their dues in full. "They settled the debt in full, it had been a long story and at one stage we even engaged lawyers to get them to pay and our lawyers tried to attach any property, which belonged to ZIFA, but could not find any,'' said Machengete.

"Remember, we helped ZIFA at a time of need but it was a loan and had to be paid back.

"Now, they have settled that debt.'' There were even accusations POTRAZ diverted $1 million, from the Universal Services Fund, to bail out ZIFA, which Machengete was forced to dismiss.

"These accusations are unfounded and may be driven by mere speculation, lack of information or outright malice,'' Machengete told The Herald last year.

"For instance, claims that USF funded the Zimbabwe Football Association is baseless. No funding was ever provided to ZIFA by USF. "Part of the confusion stems from the failure to distinguish POTRAZ from USF, which are two separate statutory bodies. "Hence, where POTRAZ bailed out ZIFA with a loan for the national soccer team's participation at the Africa Cup of Nations some sections of the society viewed this as USF funding non-core activities.''

In November last year, the High Court granted an order compelling ZIFA to pay back the money they owed to POTRAZ. High Court Judge Justice Owen Tagu granted the consent order.
"The plaintiff's (POTRAZ) claim is based on an acknowledgement of debt executed by Philip Chiyangwa (who was then the ZIFA boss) in his capacity as the defendant's board chairman, and dated January 6, 2017,'' read the court papers.

"In terms of the document an amount of $1 225 000, together with interest at the rate of 5 percent per annum, is payable to the plaintiff.

"The debtor shall pay the capital sum in 24 instalments of not less than US$46 666 the first of which is payable on or before February 28, 2017 with each subsequent instalment paid before the last day of every succeeding month.

"All payments made by the debtor will be appropriated firstly towards payment of interest and lastly in reduction of the capital sum . . . if any single instalment is not paid strictly on due date thereof, then the creditor will have the right to claim payment of the full balance of the capital sum and interest on the outstanding amount."

POTRAZ, ZIFA and Sport and Recreation Commission officials were grilled in Parliament over the loan. "Firstly, we wanted to assist ZIFA to get funding in the form of grants and loans so that they can come up with partnerships with whoever they had chosen, and in this case they got a loan from Potraz," the then Sports Commission acting director general, Joseph Muchechetere, told the parliamentarians.



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