CFX Bank ownership dispute Case Study

CFX BANK Ownership Case Study

It appears there is a misunderstanding on why I have been publishing letters relating to claim for ownership of 309 million Century/CFX Bank shares. In addition some have asked why the matter is being raised 5 years after the 309 Million shares where irregularly sold and transferred.

When the sale was done on or around 12 May 2004 I through my lawyers Ziweni and Company filed a high court application to block the sale of the shares. This record should still be there at the Harare High Court. As soon as we filed this application I was then specified without a hearing. This limited my ability to follow up the application. My lawyer and hid firm was also specified. Leaving me without legal representation on the matter.

This was all done to ensure that the 309 million shares are sold, transferred and Century/CFX Bank is snatched from my Company - ENG Capital.

Several articles have been written highlighting how these 309 million shares and Century/CFX bank was grabbed from ENG Capital. Over the time we had hoped the current and previous Directors and Management of CFX Bank would reach out and try to find out what really transpired and resolve our claim. This is the normal way of doing business. If you hear someone claiming ownership of your Bank or business you are expected to confront or engage that person to verify the nature of their claim. The CFX Bank Board, Management and shareholders somehow made the arrogant decision to behave as if everything is normal and totally disregard a claim which has been documented even at High court since day one of the fraudulent merger between Century and CFX Bank.

Even the latest press comments by the Bank through an individual identified as its Lawyer it appears they want to keep hiding behind technicalities such as you should have raised the claim earlier or you are specified therefore you cant act on your own behalf. This is inaccurate and misleading.

This level of arrogance and total disregard of material facts and potential impact on investors is an attitude which must be challenged and stopped. As out lined above this matter was filed at the high court in May 2004.And over the years articles detailing the claim have been published. Any serious and responsible Board of Directors would have taken corrective action by at least engaging in negotiations. Let it be noted that had they done that at early stages this matter would have been closed by simply acknowledging that there was some injustice but however they were not aware that such a thing had happened. This would have been a reasonable and acceptable position.

However it appears the current Board and Management want to keep denying clear facts and act as if nothing was amiss. The continual reference to my specification only highlights that the people who grabbed Century/CFX Bank from me and ENG Capital are the same people who abused the law and manipulated the legal system to specify me without a hearing so that I can follow through action to block the sale and transfer of the shares.

The cases of illegal and unjust business seizures have been occurring at an alarming rate in Zimbabwe. This must be firstly documented. Those doing it must be notified and warned. Those aiding ,abetting and facilitating such business seizures must be documented and be made aware records exist of their illegal action.

Employees in affected businesses such as employees at CFX Bank are encouraged and expected to remain professional and do their best to keep the Company vibrant but must avoid being used as proxies in a shareholder fight. This is not wise.

This part of an effort to fully document and seek redress for the fraudulent transfer of 309 million shares which were used to merge Century Bank and CFX Bank. CFX Bank was created as a result of a merger between CFX Bank and Century Bank. Century Bank was fraudulently merged with CFX Bank through the illegal and irregular transfer of 309,000,000 Century Holdings shares owned by ENG Capital and Companies owned or controlled by ENG Capital. Since this was a fraudulent and illegal transfer of ENG shares the plotters of the scheme renamed the resultant bank CFX Bank dropping the name "Century" in an effort to hide their tracks and attempt to remove any link with Century.

In April 2003 ENG Capital Investments acquired Century Discount Holdings from Century Financial Holdings ( A ZSE listed Financial Holdings Firm).The purchase price was Z$1.5 billion then equivalent to US$ 3 million. The purchase price was paid in full. ENG then applied to the Registrar of Banks and Financial Institutions for the change of controlling shareholder approval which approvals were denied.

After several attempts to get the underlying reasons for the denial I was informed that ” the Authorities” were not comfortable with ENG political inclination which they said remained “unclear” in addition issue of the ENG Directors age was raised. We then tried to find out if Century Financial Holdings was in a position to refund ENG for the purchase price and to reverse the Century Discount House purchase. Century Holdings was not in a position to refund ENG.

The only recourse was that ENG had to acquire Century Financial Holdings to mitigate any potential loss of outlay on the Century Discount house acquisition. As such ENG and its associated Companies acquired a total of 52% (including the 309 million) of Century Financial Holdings making Century an ENG subsidiary.

Through our Lawyers Ziweni and Company we sought the identity of the buyer and also to clarify that the share sell was null and void as it had all whole marks of corruption, insider dealing and was being challenged by the beneficial owners of the shares. In addition the shares had been sold through a special bargain and not an open market transparent transaction. The shares were sold for an unrealistic amount of Z$ 3 billion when ENG Capital had acquired the same shares for at least Z$35 billion. This resulted in the prejudice of Z$ 32 billion to ENG Capital Creditors and Contributories/Shareholders. We also asked the Zimbabwe Stock Exchange to investigate and stop the share transfer.

These articles form part of a wider effort to ensure that Zimbabwe’s Corporate sector eventually develops to be one where shareholders are respected and the rule of law is not applied selectively in terms of Investor protection. Whilst the case study may be focused on the 309 million shares and ownership of Century/CFX Bank the facts and scenario can be applied to other businesses that were affected by similar schemes that we devised by corrupt politicians and a corrupt central Bank Governor. It is very important that such cases be clearly and completely be documented.

Gilbert Muponda is a Founder of GMRI CAPITAL . He can be reached at; www.ZimFace.com

Email: gilbert@gilbertmuponda.com . Skype ID: gilbert.Muponda

Twitter ; http://twitter.com/gmricapital

Phone: 1-416-841-5542

NOTICE TO CFX BANK DEPOSITORS and INVESTORS

NOTICE TO CFX BANK DEPOSITORS and INVESTORS

The recent article published in the Herald Newspaper on 20 September,2009, entitled (Ex- ENG Boss Causes Controversy) - http://allafrica.com/stories/200909230013.html refers.

The Government of Zimbabwe’s attempted frivolous rebuttal to ENG Capital’s legitimate claim actually confirms ENG Capital’s ownership of the disputed 309 million shares and ownership of Century/CFX Bank. Their only purported defense is that you should have complained earlier or you are specified so you cant do anything about it. This is just hiding behind technicalities without any real or meaningful response to a legitimate claim.

The government’s lawyer’s claims, “The shares in dispute were however, disposed of by ENG liquidator to pay the depositors. Muponda skipped bail three years ago and is believed to be in the United States. He remains a specified person in Zimbabwe.”

It is common knowledge that I was detained, arrested ,tortured and specified. The legal counsel Mr, Ziweni, whom I hired to represent ENG Capital, suffered the same fate, was arrested, harassed, intimidated, specified and unfortunately died under mysterious circumstances.

As I languished in remand prison, the RBZ Governor, Gideon Gono, embarked orgy of ENG Capital asset stripping and with the assistance of the body politic gained political mileage with a sustained Muponda vilification crusade. As part of this asset stripping the 309 million shares were “bought” by Gono’s front Network Investments , Kwangari Enterprises and others.

Zimbabweans were made to believe that ENG was bankrupt and that its only assets were expensive cars. To the contrary ENG was a solid financial services company which owned a bank – Century and had other tangible assets that far exceeded the liabilities, concocted by Gideon Gono. The rebuttal by the Government’s lawyer confirms ENG Capital owned Century/CFX Bank.

Please note that the very person, Gideon Gono, who declared ENG bankrupt, is the same person who sought my specification and is the same person who then authorized the disposal of the 309 million shares. This same person was also the beneficiary of the irregular disposal of the 309 million Century /CFX shares in collusion with the Zimbabwe Stock Exchange who violated various regulations meant to protect investors in a public company.

The government further claims that, “The transaction was done in 2004”, and “in terms of the Prevention of Corruption Act, Muponda is not able to conduct any material transaction on his behalf in respect of any companies he has invested in.”

The above statement assumes that I seek relief and am pursuing my claim through the compromised and tainted Zimbabwean judicial system, which the same system is willing to be used by corrupt politicians to punish the innocent while sanitizing financial fraud by elected officials. This partisan court system was the same used strip me of my legal rights and used to brand me as a criminal without due process or the prospect of Habeas corpus.

As you maybe aware I am seeking the return and or compensation for 309 million Century Holdings Shares which were fraudulently and corruptly sold to group of politicians including RBZ Governor Gono, Ministers Goche and Gumbo. They were sold to their investment consortium which had several shelf companies including Kwangari Enterprises and Network Investments. The sale of the shares was done on or about 12 May 2004 through a pre-determined and fixed price transaction called a special bargain. As a result the current CFX Bank is a product of fraudulent merger of Century Bank (owned by my company ENG Capital) and a much smaller CFX Bank which somehow got naming rights on the resultant Bank. This “merger” was just to hide the corruption and fraud.

It is clear that the asset looting and expropriation in Zimbabwe is being done by senior Government Officials directly or indirectly through fronts. This is why some targeted sanctions have been applied on some of the politicians because they need to be stopped from their attempts to launder the proceeds from businesses they have looted and unjust enrichment schemes must be stopped. Those who are acting as their fronts, associates and conduits need to take note.

The current events that have seen Mr John Moxon , his family and Meikles Companies being specified is the same modus operandi used by politicians as they embark on unjust self enrichments by mis-appropriating businesses using draconian legislation designed to criminalize and scandalize entrepreneurs whose political views are perceived to be at variance with their own.

As I have said there is an illusion and fallacious assumption that I wont be able to take action in Zimbabwe but depositors and investors must be cautious , be realistic and don’t take chances. Action is being taken . It is for this reason that I am advising the depositors and Investors in CFX Bank to withdraw their investments from the Bank within the next 28 days. At this stage we need to find out who is aiding ,abetting and facilitating money and transaction laundering by trying to sanitize illegal and fraudulent seizure of businesses by some Zimbabwe’s politicians and Government officials. Should any one decide to remain invested in CFX Bank after the next 28 days they will only have themselves to blame if they lose out.

Yours Faithfully,

Gilbert Muponda

1-416-841-5542

Email – gilbert@gilbertmuponda.com

Skype ID – gilbert.muponda

Letter to CFX Bank Board of Directors

Bryan Hofmann,
CFX Financial Services board chairman,
CFX Bank
P.O.Box HG 472,
Highlands,
Harare , Zimbabwe.

15 September 2009

Gentlemen,

RE ; 309 MILLION CENTURY HOLDINGS SHARES FRAUDULENTLY CONVERTED INTO CFX BANK SHARES

Gentlemen this letter is a reminder of your Fiduciary responsibilities as Directors of public Company. As you are aware CFX Bank is a product of fraudulent merger of Century Bank (owned by my company ENG Capital) and a much smaller CFX Bank which somehow got naming rights on the resultant Bank.

My claim is valid and legitimate and as a result will be pursued through all available options till a logical conclusion. At this stage it is important that as Board you make a choice on whether you are prepared for a pro-longed dispute. At this stage you have a duty to inform the investing public about the nature of this claim as it has a material impact on the Banks asset base and trading capacity. Failure to do so amounts to gross negligence on your part.

As the majority shareholder I intend to exercise my fiduciary duty on behalf of my self as shareholder, founder and contributory of ENG capital to fully document and seek redress for the fraudulent transfer of shares which were used to merge Century Bank and CFX Bank. CFX Bank was created as a result of a merger between CFX Bank and Century Bank. Century Bank was fraudulently merged with CFX Bank through the illegal and irregular transfer of 309,000,000 Century Holdings shares owned by ENG Capital and Companies owned or controlled by ENG Capital. Since this was a fraudulent and illegal transfer of ENG shares the plotters of the scheme renamed the resultant bank CFX Bank dropping the name "Century" in an effort to hide their tracks and attempt to remove any link with Century. ENG Capital owned a total of 900 Million shares in Century and the balance was transferred clandestinely to avoid detection of the fraud that was being perpetrated.

I may seek relief through the courts as a last resort. At this time it is important to note we have observed several instances whereby the court's orders are ignored and dis-regarded and as such we will be seeking redress in jurisdictions beyond Zimbabwe. In addition we will be seeking redress jointly and severally from certain individuals and entities that are directly benefiting and seeking to aid and abet asset grab and asset looting that is now common in corporate Zimbabwe.

The shares in question have changed the ownership at the start of my claim “with a view to evading the consequences of the litigation”.

Various transactions and Company re-organization schemes with the ultimate aim of sanitizing asset looting and illegal expropriation of our Assets. The current proposed recapitalization exercise must be viewed in the same light as it now seeks to sell our illegally transferred shares into hands of another foreign Bank which will further hide the tracks of the illegal transaction. This must be documented and stopped.

The Senior Management and Directors of CFX are co-conspirators in an elaborate scheme to defraud ENG Capital and its shareholders and contributories. They have falsely and fraudulently with others known and unknown, unlawfully, willfully, and knowingly did combine, conspire, confederate, and agree together and with each other to commit offenses against ENG Capital to commit fraud in connection with the purchase, sale and transfer of the 309,000,000 Century Holdings Ordinary shares.

Furthermore the directors of Century/ CFX provided false and misleading information to CFX’s regulators, Zimbabwe investing public ,auditors and concealed from them their falsification of Century/ CFXs books and records, and manipulation of data recorded in CFXs general ledger and subsidiary ledgers. Making and causing CFX to make untrue statements of material facts and omitting to state material facts necessary in order to make the statements made. This was all done in an effort to hide the tracks of ENG Capital's controlling stake shares in Century/CFX Bank.


As a detailed background in April 2003 ENG Capital Investments acquired Century Discount Holdings from Century Financial Holdings ( A ZSE listed Financial Holdings Firm).The purchase price was Z$1.5 billion then equivalent to US$ 3 million. The purchase price was paid in full. ENG then applied to the Registrar of Banks and Financial Institutions for the change of controlling shareholder approval which approvals were denied.

After several attempts to get the underlying reasons for the denial I was informed that ” the Authorities” were not comfortable with ENG political inclination which they said remained “unclear” in addition issue of the ENG Directors age was raised. We then tried to find out if Century Financial Holdings was in a position to refund ENG for the purchase price and to reverse the Century Discount House purchase. Century Holdings was not in a position to refund ENG.

The only recourse was that ENG had to acquire Century Financial Holdings to mitigate any potential loss of outlay on the Century Discount house acquisition. As such ENG and its associated Companies acquired a total of 52% of Century Financial Holdings making Century and ENG subsidiary.

After my arrest on fabricated charges ENG was placed into Provisional Liquidation as a way to secure the creditors. The creditors agreed to take shares held by ENG IN lieu of payment. As such the contributories, directors and lawyers and creditors agreed the shares should not be sold whilst a fair valuation was being negotiated. However we were shocked to read in the papers that a parcel of 309,000,000 Century shares belonging to ENG had been sold through a pre-fixed special bargain transaction on or about 12 May 2004. The beneficiary to this transaction has remained a mystery even though we have reliable information as to the ultimate beneficiaries.

Within a week of this sell of shares it was announced that Century Bank will now be merged with CFX Bank and the new Bank will be called CFX Bank. It is clear the merger was a laundering transaction meant to hide and sanitize the illegal and irregular transfer of the shares owned by ENG.The name Century was immediately removed and the new entity rebranded CFX Bank despite the fact that Century Bank provided a majority of the assets and infrastructure of the new Bank.

The so-called merger was only arranged to hide the true nature of the illegality of the transfer of ENG shares in Century. It is clear that without the illegal and irregular share transfer the merger would not have happened and would not have made any sense ,it was therefore just done to cover the tracks of the asset grab that had taken place

Through our Lawyers Ziweni and Company we sought the identity of the buyer and also to clarify that the share sell was null and void as it had all whole marks of corruption, insider dealing and was being challenged by the beneficial owners of the shares. In addition the shares had been sold through a special bargain and not an open market transparent transaction. The shares were sold for an unrealistic amount of Z$ 3 billion when ENG Capital had acquired the same shares for at least Z$35 billion. This resulted in the prejudice of Z$ 32 billion to ENG Capital Creditors and Contributories/Shareholders. As such ENG Capital contributories were not fairly and justly paid for the value of the shares held by ENG Capital. Its this discrepancy that I want resolved and close the matter so that the Institution and My self can each focus on our future without any litigation or dispute lingering on.

We also asked the Zimbabwe Stock Exchange to investigate and stop the share transfer. However due to the general prevailing atmosphere and fear to challenge “authorities ” no one was willing to assist us to stop or challenge this illegal and irregular transfer of the shares to an ” unidentified” buyer believed to be a group of senior political figures. In this instance the Zimbabwe Stock Exchange did not act properly and prudently in defending and safeguarding shareholder interests. Given that we had raised a legitimate concern the share transfer should not have been permitted.

The redress I seek will not in anyway affect the Bank employees and staff. The claim arises out of acts carried out about 5 years ago and subsequent other schemes and transactions meant to sanitize an illegal act. Clearly I have waited for 5 years hoping the plotters, CFX Management, Shareholders will seek to do the right thing and at least acknowledge this act and make amends as a way forward and ensure that the Bank can settle any such claims. I hope your judgement will not be clouded by the illusion that this claim will some how disappear or you can avoid being held accountable by the current unstable and unpredictable environment in Zimbabwe.

For the sake of transparency I am copying this letter to the following ;
Minister of Finance Zimbabwe - Hon Tendai Biti

Reserve Bank of Zimbabwe Governor – Dr Gono

Minister of Justice - Hon Patrick Chinamasa

Zimbabwe Stock Exchange CEO – Mr Emmanuel Munyukwi

Yours Faithfully,

Gilbert Muponda
Toronto ,Canada

1-416-841-5542


Email – gilbert@gilbertmuponda.com

Skype ID – gilbert.muponda