Three investigators from the Drug Enforcement Commission (DEC) are this week expected to fly to South Africa to probe why Shoprite Holdings is refusing to pay dividends to Zambian minority shareholders.
This is at the expense of Shoprite checkers and it is not known why the DEC has asked Shoprite Checkers to fund the trip.
This is a case in which Shoprite Holdings Zambia and its South Africa subsidiary have been refusing to release over K5.2 billion as dividends to Zambia minority shareholders.
But the chain store has paid off its South African shareholders, while holding on to the money for Zambians.
On Monday this week, the Lusaka Stock Exchange general Manager Beatrice Nkanza directed Shoprite Holding to pay Zambia minority shareholders their dues within two weeks or face reprimands.
The dividends have accrued from September 2011 to April this year.
The Lusaka High Court has refused to grant the Drug Enforcement Commission (DEC) stay of execution following a May 18 judgment against the DEC continued seizure of bank accounts for a Lusaka law firm Lewis Nathan Advocates.
The DEC had seized bank accounts for Lusaka law firm Lewis and Nathan for alleged money laundering the Lusaka High Court asked DEC to unfreeze the accounts because the law firm, which was representing Zambian minority shares was not involved in any fraud.
The Court which has however allowed the DEC leave to appeal against the judgment could not grant the stay as the appeal might not succeed.
In the judgment, Justice Christine Phiri has observed that the DEC seizure came at the time when the Shoprite Group freezing order granted by the Kitwe High Court but later thrown out, was still subsisting.
Sources at the DEC have said the commissions has authorized three officers including one from the Zambia Police to travel to South Africa to probe why the Shoprite Group is refusing to pay Zambian shareholders.
The named Drug Enforcement Commission (DEC) officers led by Mathias Kamanga are set to travel to South Africa this week on a trip that Shoprite Holdings has financed.
The trio’s trip is highly disguised in a DEC request for funding through normal channels ostensibly to undertake investigations in South Africa.
The three DEC officers leave for Johannesburg in a quest led by Deputy Commissioner Lottie Mpundu seeking to save the DEC’s face in the eyes of appointing authorities as well as prevent the law firm Lewis Nathan Advocates from pursuing damages against Shoprite in the Kitwe High
“It was today (May 28) when Elizabeth Kanjela discussed the list of officers to travel to South Africa together with Mr. Mpundu.” We thought this matter is over; It is far from being over because there is an invisible hand that is controlling the whole matter, the source said, adding “I personally told Mr. Mpundu to be careful but he seems to have a vested interest in the matter.”
The Lusaka High Court reprimanded the DEC over the move by Shoprite Checkers Zambia not to release dividends for local minority shares.
The Lusaka High Court also asked Shoprite Checkers to show cause for their continued seizure of the now unblocked accounts belonging to former Shoprite Checkers transfer secretary, Lewis Nathan Advocates.
The High Court also ruled that all sales that occur on the Lusaka stock Exchange are published on a daily basis to the knowledge of all market players including Shoprite Checkers which had however told a shareholders’ that the shares were lost in Lusaka.
The High Court also ruled that the DEC investigators overstepped the realm of the relevant confines and scope of the investigations relevant and logical to the fact in issue.
On December 5, 2011 and January 30, 2012, the DEC had seized bank accounts for Lewis and Nathan Advocates.
But the Court ordered and observed the opening of the account whose closure was effected while a Shoprite action in the Kitwe High Court to freeze the account through an injunction was still subsisting.
The Kitwe Court also disagreed with Shoprite claim that the seized accounts contained their money, before throwing the injunction and freezing order earlier granted.
The judgment came three days after the DEC had issued another seizure notice on Lewis and Nathan at Barclays and Stanbic banks.