LOOTING: Former Airtel Kenya boss in Sh33 billion Vodacom Scandal


11 May 2015 | by
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LOOTING: Former Airtel Kenya boss in Sh33 billion Vodacom Scandal

Former Airtel Kenya boss and Vodacom Tanzania’s Managing Director, Rene Meza resigned on Thursday over a Us $350 million (Ksh 33.250 billion shillings) scandal involving the sale of illegal mobile phone top up vouchers. His resignation led to a crisis meeting by senior Vodacom managers who were scheduled to make a public statement over his quitting.

It is suspected that Meza is likely to flee Tanzania for fear of prosecution over the multi million shillings bribe scandal.

Meza is reported to have tendered his resignation on Thursday morning to his bosses according to sources in Vodacom South Africa and Vodacom Tanzania in Dar es Salaam.

Meza had been under pressure for allegedly receiving  a US$5 million bribe from TanilSomaiya, the owner of Shivacom Group to keep quiet about the fraud by several Vodacom super dealer.

It is reported that Meza secretly met with Somaiya and Rostam Aziz, a Vodacom Tanzania shareholder, more than ten time to negotiate the IS$ 5 million bribe.

Vodacom Tanzania issued a carefully-worded statement he attempted to play down the scandal by denying but details of the fraud leaked out.

A Vodacom Tanzania letter to Shivacom Group dated 11 July 2012 terminating the contract indicates that there was massive fraud in the printing, distribution and sale of pirated recharge vouchers by Shivacom Group.

The letter signed by Vodacom Tanzania’s chief legal officer WalarickNittu to Somaiya also revealed that Vodacom suffered huge financial losses from the fraud.

 

“It has been established that you have been fraudulently, and in total breach of the contract, producing duplicate pirate electronic recharge vouchers using pin numbers provided by Vodacom,” said.

Tanzania Parliamentary Finance and Economic Affairs Committee has ordered the Tanzania Revenue Authority (TRA) to investigate the scandal and submit a report the amount of taxes evaded.

The scandal involved the production of the electronic recharge vouchers in a contract signed between Vodacom Tanzania and Tanil’sShivacom Group in 2007/08.

Shivacom acted both as a Vodacom super dealer, printer and supplier of electronic recharge vouchers in an obvious conflict of interest.

In the elaborate scandal, Tanil’s company, Shivacom Group, printed millions of pirated 500 shillings electronic recharge vouchers (JeroJero) between 2008 and 2012 and colluded with other companies owned by Fred Lowassa (Alphatel) and TIB Development Bank Managing Director Peter Noni (Planetel) to distribute the vouchers across Tanzania.

Also implicated in the scandal is the biggest shareholder of Vodacom Tanzania, Rostam Aziz.

The scandal also involved tax evasion of Value Added Tax (VAT) worth more than 121 billion shillings by Shivacom.

Shivacom is said to have distributed more than half of the fake recharge vouchers, while the others were distributed by Alphatel and Planetel.

Interestingly, the scam has led to loss of confidence in Vodafom Tanzania by customers resulting in the upsurge of former Meza's employers Airtel.

Meza is reported to have found out about the scandal when he took over in Vodacom Tanzania from Kenya and confronted Tanil about the scandal.

He instructed Vodacom’s legal counsel to terminate Shivacom's the electronic recharge voucher agreement for breach of contract.

Tamil in turn went to Vodacom South Africa’s Group CEO, Shameel who then instructed Vodacom Tanzania to settle the matter with Shivacom.

Meza is said to have finally settled for a US$5 million bribe from Tanil but Vodacom Tanzania paid Tanil huge compensation for termination of the contract despite the obvious fraud.

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