Kuda Bwititi and Itai Mazire

Finance Minister Mr Tendai Biti is under police investigation after US$20 million, which was drawn from the International Monetary Fund (IMF) Special Drawing Rights (SDRs), allegedly disappeared under mysterious circumstances from the coffers of the troubled Interfin Merchant Bank.

The money was meant to fund distressed industries as part of Government’s efforts to revitalise underperforming manufacturing companies.

However, the whereabouts of the US$20 million is now a source of conjecture with the police launching an investigation into the matter.

On the other hand, Minister Biti confirms that the money “disappeared’’ but denies any wrongdoing.

National police spokesperson Senior Assistant Commissioner Wayne Bvudzijena confirmed investigations were under way but he could not be drawn to reveal details of a case he labelled “sensitive’’.

“There are allegations of that nature but we are not keen to make the matter public at the moment. Police should be left to deal with the issue,’’ he said.

However, senior police sources last night said Minister Biti was being investigated on allegations that include contravening the Audit and Exchequer Act, abuse of office and corruption.

It is alleged that Mr Biti contravened the Audit and Exchequer Act in 2009 when he allegedly acted outside his mandate by directing Treasury to draw the money from IMF into an FBC account before transferring it to Interfin instead of the Exchequer Account, as stipulated by law.

Prior to its revocation and replacement by the Public Finance Management Act in April 2010, the Audit and Exchequer Act provided that all public money should be deposited into the Exchequer Account at the Reserve Bank of Zimbabwe.

Part V of the revoked Audit and Exchequer Act Section 22 which focuses on the Establishment of banking accounts said: "The Treasury shall establish with the Reserve Bank an account, to be known as the Exchequer Account, for the deposit of moneys forming the Consolidated Revenue Fund and may, within the Exchequer Account, establish separate accounts for the investment of surplus funds, which accounts shall be part of the Exchequer Account".

Section 23 of the Act added: "(1) Subject to this Section and Subsection (9) of Section 30, all revenues shall be paid into the Exchequer Account. "(2) A receiver of revenue may, if authorised by Treasury and subject to such conditions as may be fixed by the Treasury, withhold from the Exchequer Account revenues which have been collected and shall retain revenues so withheld in a deposit account for the purpose of making refunds of revenues or moneys erroneously brought to account as revenues.

"(3) Public moneys, other than revenues, shall, if so prescribed, be paid into the Exchequer Account with effect from such date as may be prescribed".

Police also suspect that Mr Biti went on to prop the formulation of the Public Finance Management Act, which was enacted in 2010 to repeal the Audit and Exchequer Act "to cover his tracks".