Counterfeit money has come into circulation in Zimbabwe’s capital, Harare, less than a week before the complete change-over to a new currency introduced by Reserve Bank of Zimbabwe (RBZ) Governor Gideon Gono last week.
In sweeping currency reforms that also included a 60% devaluation of the local dollar, the RBZ slashed three zeros from every banknote and said it would introduce a new “family of bearer cheques” with fewer zeros by August 21.
Bearer cheques are promissory notes first introduced by the RBZ three years ago at the height of cash shortages in Zimbabwe. They are not official legal tender, but are used in the same way as money.
The RBZ says anyone still holding on to old bearer cheques after the change-over deadline would have to turn the cheques into “garden manure”, and fraudsters have jumped in to make a quick buck as people rush to exchange old currency for the new one.
The counterfeiters appear to be targeting street vendors and other unsuspecting traders on Zimbabwe’s bustling informal market to offload fake new bearer-cheque notes, especially in late-night transactions.
For example, a cellphone airtime vendor, Tapiwa Chitemerere, who was given a new Z$10 000 (Z$10-million in old money) bearer cheque last Tuesday night, said he did not suspect anything when a customer tendered the note.
“I gave him change and only realised the currency was fake when I tried to buy bread and milk at a supermarket the next morning,” he told independent news service ZimOnline.
It was not possible to establish immediately from the RBZ how much counterfeit money could have been pumped on to the market or what measures the central bank was taking to curb the problem of fake bearer cheques.
But banks have raised an alert on the presence of fake currency. For example, the forensic services manager at Stanbic Bank Zimbabwe, one of the biggest commercial banks in the country, warned staff in a memo to be “on the lookout for fake bearer-cheque notes of the new currency that are already in circulation … we urge you to scrutinise the bearer cheques that you are handling with a view to putting a stop to this counterfeit-note fraud”.
Villagers in remoter parts of the country where new notes are still to be distributed could lose millions of dollars to counterfeiters, taking advantage of widespread ignorance about the new money among people in such parts of the country.
The RBZ currency reforms are meant to bring stability to the near-worthless dollar and lessen the burden for Zimbabweans who were experiencing enormous inconvenience because of bearer cheques with too many zeros.
Analysts and business leaders say the currency changes will in the interim help curb money-supply growth, but far more drastic and broader reforms are needed if the central bank is to sustain its latest attempts to shore up the dollar. — ZimOnline