Sport and Recreation Council (SRC) Grilled Over $USD1,2m POTRAZ Loan to ZIFA

Debt-ridden Zifa has sunk into deeper financial problems, as the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) pursues the $1,2 million they loaned out to the football governing body.

Zifa board member finance, Philemon Machana once mentioned that they were pinning their hopes on the government settling the Potraz debt, as it had the responsibility to fund the country’s participation at Afcon

In a sudden turn of events, Sport and Recreation Council (SRC) Director of Sport Joseph Muchechetere was yesterday grilled in Parliament over a $1,2 million loan which the SRC sourced from POTRAZ to fund the Zimbabwe senior national football team to participate in the Africa Cup of Nations (Afcon) Cup.

The loan was a business deal where Potraz was said to be charging 5% interest, and was lent to the Zimbabwe Football Association (Zifa) without tight mechanisms in place to ensure that it was serviced or paid back.

Acting Sport Portfolio Committee chairperson Joshua Murire asked Muchechetere to explain the SRC’s role in the transaction and whether they made follow-ups as a regulatory body to ensure that Zifa paid back the loan.

“Firstly, we wanted to assist Zifa to get funding in the form of grants and loans so that they can come up with partnerships with whoever they had chosen, and in this case they got a loan from Potraz,” Muchechetere said.

“We were also interested in ensuring that the loan they got was utilised and we also relied on internal mechanisms within Zifa to ensure councillors played their part and were trained to ensure they know their mandate, and we also received audited accounts and reports which spoke on how they have utilised the money,” he said.

Asked by the committee whether the SRC was wary of the possibilities that after signing the contract with Potraz, Zifa might not pay back the loan, Muchechetere said Zifa were aware that if they defaulted the SRC would take disciplinary action on them.

“All organisations registered with the SRC must comply with the statutes because we are also protecting the lender, because if they do not pay back the loan, then that organisation will not participate in sports,” he said.

Muchechetere said the international football body Fifa only required that they be informed about the loan.

“Disciplinary action can only be taken by the SRC on behalf of government. We are discussing with the new Zifa executive and they are in the process of putting up mechanisms to do a forensic audit. They (Zifa) are discussing with Fifa and the SRC, and once we know what went wrong in terms of this Potraz loan we will be in a position to make recommendations to Zifa. If they fail to take up our recommendations, then we will move to the next step,” Muchechetere added.

He told the committee that at the time Zifa had no money to fund the Warriors for Afcon and when they approached the SRC, the regulatory body handed them over to the then Sports minister Kazembe Kazembe, who then approached POTRAZ.

Kazembe said: “The loan was given to Zifa and we think they will repay it.”