Zimbabwean authorities to crackdown on Illegal currency dealers

Illegal foreign currency dealers on Tuesday literally deserted the streets in Harare’s Central Business District, as the government continues warning that it will deal severely with offenders.

The parallel market rate of the U.S. dollar to the bond dollar also fell drastically from around 350 percent on Friday to 150 percent Monday, but dealers said the situation continued to be volatile while prices of basic commodities continued to soar.

A tour by Xinhua in the CBD showed that most of the dealers who used to throng Sam Nujoma Street and the First Street Mall were nowhere to be seen, while just a few brave ones whispered to potential buyers that they were open for business.

A honey vendor said while the illegal dealers were not visible, they were still around but remained wary of the authorities.

“Just like me, they disappear at the first sight of trouble and remain underground until they feel that it is safe to continue with their business.”

Some dealers have also masked their activities by remaining on the streets purporting to be buying old Zimbabwe dollar notes but they quickly admit that they also trade the foreign currency.

One dealer along Sam Nujoma Street said it had become dangerous to operate openly and had devised new ways to evade arrest by pretending to be only interested in the old notes.

The government in Sept. 2017 passed a new law against illegal foreign currency dealing that enables the state to jail offenders for up to 10 years and authorizes the police to seize the cash being transacted.

The regulations also impose several other penalties including the freezing of funds, if the illegal deals are conducted through banks, while the courts may impose fines of three times the value of the currency confiscated.

Prior to the Sept. 2017 regulations, the Banking Act only allowed the central bank to impose penalties on offenders.

The dealers quickly disappeared from the streets, only to reappear when they realized that law enforcement agencies were not descending heavily upon them.

Since then, business has been flourishing on the black market from where companies are said to have been sourcing foreign currency because local banks have not been able to provide it.

It is also suspected that top politicians and some business people are behind the illegal activities.

Two weeks ago, Zimbabwean President Emmerson Mnangagwa declared war on the black market saying that it was a threat to national security.

“A great threat to our bid to stimulate productive activity in the economy comes by way of non-productive, speculative activities operating below the radar but involving millions in precious foreign currency and bond notes.

“These nefarious activities thrive on different electronic platforms. New measures will be pursued to stop such malpractices,” he said then.