ALLIED Timbers Zimbabwe, a state enterprise, has suspended its chief executive Dr Joseph Kanyekanye after the board raised several charges of misconduct against him.
The suspension is with immediate effect and is meant to facilitate investigations into his conduct, which borders on corruption, failure to observe operating procedures and gross insubordination, group chairman Mr Emmanuel Fundira said.
Dr Kanyekanye was sent on forced leave on December 10 last year to allow the board to independently evaluate the operations and financial position of the company.
“In view of the serious nature of the charges you are facing, I am hereby suspending you from duty without pay and benefits with immediate effect pending finalisation of this mater . . . ,” Mr Fundira wrote to Dr Kanyekanye on January 14, 2015.
“You are therefore directed to surrender all company assets in your possession including the company motor vehicle to the board chairperson immediately upon receipt of this letter.”
No comment could be immediately obtained from Dr Kanyekanye at the time of going to print.
Outlining the charges, the group alleges Dr Kanyekanye failed to follow proper operating procedures and company policies resulting in substantial loss, harm or prejudice.
For instance, an analysis of the debtors’ book revealed that plus or minus 80 percent of the debtors did not go through the credit committee as per standard procedure.
As a result of the procedural breach, the board says the unrecoverable debts for Botswana amounts to 4,85 million pula. Allied used to export timber products to Botswana.
Further, local operations unsecured debtors book stands at $4,72 million.
The board also established that Dr Kanyekanye extended unauthorised, unvetted and unsecured credit to “related parties”, which remain unrecovered.
For example, former Minister of Environment Francis Nhema was supplied with treated poles worth $25 000, unsecured credit still outstanding and unrecoverable.
TS Timbers, said to be owned by Dr Kanyekanye’s family associates and Nyika Enterprises, owned by businessman Mr Chester Mhende, were granted credit facilities worth $193 304 and $119 880, respectively. Both facilities are outstanding and unrecoverable.
Clecko and Rubbertive, owned by Mr Gerald Mujaji, was a given an unsecured credit facility of $89 000 which has not been paid and the company has since been liquidated.
It was also established that Dr Kanyekanye exceeded the $20 000 limit which he was permitted to buy items for capital programmes without going to tender and were overpriced.
In 2012, Dr Kanyekanye directed the purchase of three slidetech machines at $75 000 each despite having been advised the same machines from Finland would cost $43 000 each.
The prejudice suffered by Allied as a result of such “fraudulent” activities was $1,5 million.
“You have also led the company to face various litigations (arising from labour disputes) resulting in a contingency liability of $826 000 as per 2015 budget,” said Mr Fundira.
Dr Kanyakanye is also accused of failing to ensure sustainable forestry planting, resulting in a current year planting backlog of unplanted areas of 37 000 hectares.
In addition, Dr Kanyekanye continued to receive housing allowance despite having accessed a housing loan in 2001, the year he joined the group. The company has also been operating without tax clearance certificate from Zimbabwe Revenue Authority and has not been paying corporate taxes, tax on motoring benefits and tax on rentals resulting in a tax and penalties liability of around $700 000.
The outstanding pension deducted from workers but not remitted to the fund stands at $682 000.
Dr Kanyakanye is said to have refused to provide the board with correct information regarding the debts, non-disclosure agreements, land ownership details and contracts.
