Air Zim's $10M Insurance Scandal: How Two Bosses Were Jailed
By Tendai Rupapa, Senior Court Reporter
Two former Air Zimbabwe executives, former CEO Peter Chikumba and former company secretary Grace Pfumbidzayi, were convicted of criminal abuse of office for their roles in a fraudulent insurance scheme that cost the national airline approximately $10 million.
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| The national carrier was defrauded over four years. |
The $10 Million Insurance Scandal
The court found that between April 2009 and April 2013, Pfumbidzayi and Chikumba improperly appointed Navistar Insurance Brokers to handle Air Zimbabwe's aviation insurance without following the required tender procedures. This decision was made despite the airline having a longstanding relationship with another broker, Marsh Insurance Brokers.
The financial prejudice arose from grossly inflated payments. Air Zimbabwe, which previously paid Marsh Insurance Brokers €125,000 per year, began paying Navistar €300,000 per quarter. This amounted to €1.2 million annually—nearly a tenfold increase. The magistrate noted that this drastic hike occurred even as some of the airline's aircraft were grounded, with no expansion in fleet size or routes to justify such an increase.
The Trial and Arguments
During the trial, Peter Chikumba attempted to distance himself from the crime, claiming he had referred all insurance matters to Pfumbidzayi. However, the magistrate dismissed this, stating, "He wanted to cover his tracks but he did not cover them well." The court found evidence that he chaired the meeting where the decision to engage Navistar was made and knew the process was fraudulent.
Prosecutor Mr. Daniel Muchimbiri argued that the offense was "well planned and well executed." Magistrate Mtombeni agreed, ruling that Pfumbidzayi was the "nexus" of the fraud and that both she and Chikumba "connived and showed favour to Navistar." The failure to produce minutes of the meeting where Navistar was supposedly appointed was a key piece of evidence showing the fraudulent nature of the deal.
The Verdict
Both Pfumbidzayi (50) and Chikumba (60) were found guilty of criminal abuse of office as public officers. The court ruled they had a duty to protect the airline's interests but instead acted in a way that benefited Navistar at the expense of Air Zimbabwe. They were, however, acquitted on an alternative charge of contravening the Procurement Act.
Sentencing and Pleas for Leniency
Upon conviction and facing a custodial sentence, Grace Pfumbidzayi broke down in tears on the witness stand. "Whatever I did, and no matter how misguided it was, I did in good faith," she pleaded. "The court found out that it amounted to a criminal conduct and for that I apologise for my actions." She asked for a non-custodial sentence, stating she was comfortable with anything that would allow her to go home to her children.
Despite the pleas for leniency, both Pfumbidzayi and Chikumba were sentenced to 10 years in prison. Three of those years were suspended on condition of good behaviour, leaving them to serve an effective seven years. The magistrate's decision underscored the seriousness of corruption within state enterprises. An appeal was later lodged but was dismissed by the High Court as being "fatally defective."
Key Players in the Case
- Grace Pfumbidzayi: Former Air Zimbabwe Company Secretary. Convicted.
- Peter Chikumba: Former Air Zimbabwe Group CEO. Convicted.
- Ms. Fadzai Mthombeni: Presiding Regional Magistrate.
- Mr. Daniel Muchimbiri: Prosecutor.
- Adv. Webster Chinamhora: Defense lawyer for Pfumbidzayi.
- Admire Rubaya: Defense lawyer for Chikumba.
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