Home » Sports » The Zifa Empire Is Crumbling

THE onslaught by creditors on bankrupt ZIFA continued yesterday with the Messenger of Court raiding the business premises of the association’s board member Ben Gwarada and attaching two 30-seater luxury minibuses, furniture and computers.

A 75-seater luxury bus was also set to be towed away but the Messenger of Court did not have the tow-away vehicle for such a job and promised they would return today to complete their mission.

Gwarada, who is the ZIFA board member in charge of finance, was in Bulawayo on business, when the Messenger of Court raided his business premises — LED Travel and Tours — at Number 6, Fereday Drive, In Eastlea, Harare.

LED Travel and Tours was the travel agency used by ZIFA to issue air tickets, about a year before Gwarada was voted onto the association’s board, for the Warriors to travel to Cairo for a 2014 FIFA World Cup qualifier against Egypt in Alexandria.

The Pharaohs won that match 2-1.

A $53 000 loan was acquired from BancABC to cover the cost of the tickets, with the ZIFA Trust underwriting the transaction and the chairman of the Trust, Tshinga Dube, providing the security.

This followed a presentation made by ZIFA chief executive, Jonathan Mashingaidze, that they would pay back the loan through earnings from a US$250 000 annual grant they receive from FIFA, and other prospective revenue streams.

Mashingaidze said their earnings would be enough to dissolve the debt and leave the travel agency’s account with the bank in the black.

Twenty thousand dollars from the earnings generated by the Warriors during the 2013 CHAN finals where they went all the way to the semi-finals, and received $250 000, was paid towards the dissolution of the loan, leaving a remainder of $32 000.

But, along the way, the commitments to pay back the loan were not met and a payment plan, which was drafted after the bank started raising issues that the loan was not being serviced as initially agreed, was not followed.

The travel agency, which is in a good financial position, was not prepared to use its funds to offset a loan that belonged to ZIFA and their Trust and to effectively pay the cost of the Warriors’ travel to Egypt.

However, as pressure from the bank grew, Gwarada started making regular payments into the account towards offsetting the debt, exposing himself further in a transaction that should have been liquidated by the association.

He sought the help of ZIFA and yesterday he said Mashingaidze promised that the association would dissolve the debt from the 2014 FIFA World Cup bonuses that were given to all the associations.

FIFA paid US$250 000 into the accounts of their member associations, as a bonus, following the world football governing body’s congress held in Brazil last year. A circular from FIFA secretary-general, Jerome Valcke, which is available online and was sent to all member associations in December last year, confirms that.

“Please find enclosed the 2015 FAP application forms (FAP forms 1, 2 and 3). This year, the form to apply for the 2015 FAP has been adjusted to take into account the additional bonus confirmed by the FIFA Executive Committee today at its meeting in Marrakech,” said Valcke in his circular.

“We are thus very pleased to confirm that this year, all FIFA member associations will receive an additional bonus of $500 000 in connection with the final financial results of the 2014 FIFA World Cup Brazil.

“In addition, following the final analysis of the financial results for the 2011-2014 cycle and a proposal made by the FIFA Finance Committee, the FIFA Executive Committee has approved additional financial support of $300,000 for each of the member associations participating in the FIFA 2018 World Cup qualifiers.

“Consequently and in summary, this means that in 2015, each member association will be entitled to receive $1 050 000 — $250 000 for the 2015 FAP $500 000 as a one-off financial bonus and $300 000 as support for the preparation of and participation in the 2018 FIFA World Cup qualifiers.

“This sum is in addition to the first tranche of $250 000 of the bonus that was made available after the 2014 FIFA Congress. Therefore, the total one-off contributions made to FIFA member associations as a result of the good financial results of the 2014 FIFA World Cup amount to $1 050 000 each plus, as mentioned, the normal 2015 FAP contribution of $250 000, making a grand total of $1 300 000.”

This means that ZIFA received US$500 000 from FIFA last year and could receive more subject to its audited financial statements satisfying the requirements of the world football controlling body.

However, despite receiving $500 000, which was the money the association had promised to meet the costs of the dissolution of the loan at the bank, ZIFA did not play ball as they had promised and BancABC were left with no option but to take action.

There are claims that ZIFA received a further $500 000 last month but this could not be confirmed last night given that the association have resorted to opening different bank accounts, to try and find ways of managing their precarious financial position, where incoming funds would simply be swallowed by overdraft facilities.

Why the association didn’t meet their side of the bargain, as promised, remains a huge talking point.

“Mashingaidze had promised that he will use funds from FIFA to get this issue sorted out but nothing happened and this is what has led us to this unfortunate position,” Gwarada told The Herald yesterday.

“It’s sad that it has come to this because as a company we were only asked to help a situation and we did it for the sake of the nation, banking on the promises that we were getting from ZIFA that things would be sorted out but, unfortunately, it has dragged us into this mud.

“We operate on a basis of trust from our clients and this is the last thing that we needed.”

Source : The Herald