HARARE – President of the National Council of Zimbabwe Chiefs Fortune Charumbira faces the imminent threat of his luxury SUV vehicle being auctioned off after defaulting on repayments amid a crackdown on overdue loans by banks.
People’s Own Saving Bank (POSB) has served notice of an auction of the Toyota Land Cruiser for recovering dues from Charumbira.
The vehicle is set to go under the hammer on Friday, LM Auctioneers said in a notice yesterday.
The senator claimed that the debt was taken up by his brother Mudavanhu Charumbira.
He claimed he had merely co-signed the agreement as the guarantor — a person who agrees to repay the borrower’s debt should he or she default on agreed repayments.
“I did not take that loan but it’s my brother’s, Mudavanhu,” Charumbira told the Daily News yesterday.
“I am only taking care of him, ndochivanhu chedu. Kana munin’ina wako akatadza kuwana mombe dzakakwana dzekuroora, haumubatsiri? (If you brother is short on his bride price, will you not assist him?” he asked rhetorically.
Charumbira could not say how much the outstanding dues were.
“I don’t know how much, I really don’t know. The last time I talked to him about it, it was $5 000 but I don’t know what it is now,” he said.
Banks are increasingly selling off unpaid consumer debts to collection agencies, who are buying the liabilities for a pittance.
Increasing numbers of people who have mortgage shortfalls and other debts are now being threatened with auctions.
Charumbira is the latest high profile person to lose his property after African Banking Corporation last week auctioned off former Premier Service Medical Aid Society (Psmas) chief executive officer Cuthbert Dube’s four bedroomed Borrowdale home, seized after failing to settle a debt.
Dube’s palatial property went under the hammer last week along with property belonging to businessman Simbarashe Mupandanyama, the group CEO for Broadway Investments, who lost his Glen Lorne home after defaulting on a CBZ loan.
The ongoing financial squeeze has seen a new a surge in foreclosures representing a new wave of distressed property seizures, with many banks no longer willing to grant struggling debtors forbearance.
Economists have urged banks to commit to responsible lending, under which financial institutions must assess if people will be able to repay their debt before they are advanced new loans or have their credit limit increased.