ZRA loses US$64m in Prestige Motors payment saga

By MUKWIMA CHILALA

SERIOUS fraudulent activities surrounding the Zambia Revenue Authority’s payment to Prestige Motors have been exposed, raising many questions about the conduct of the motor company’s owner, Donovan Gray.
In 2015, ZRA filed an appeal with the Supreme Court against the US$64 million ruling, after the case deadline had passed. The ZRA Board then instructed an out-of-court settlement, which resulted in ZRA agreeing to pay US$16 million to Prestige Motors, significantly reducing the initial award by US$48 million.
The US$16 million payment saga between the ZRA and Prestige Motors Limited dates back to 2012, long before former ZRA Commissioner General Kingsley Chanda assumed office some newly obtained details have revealed.
Yesterday, Law Enforcement Agencies informed the Public Accounts Committee (PAC) that they were investigating Mr Chanda over an $8 million payment linked to the case, despite the fact that he was not at ZRA when the matter began.
And now, Tunta Mining and Lunga Resources have accused Prestige Motors of unlawfully obtaining a court judgement to secure a US$64 million payout, a scheme hatched by Gray whom they have described as a “dangerous international fraudster.”
He was arrested and charged with forgery and uttering false documents, which he used in his questionable dealings, but powerful individuals in police and other government agencies secured his release.
The two companies allege that Gray used forged documents to obtain the fraudulent judgement and secure the substantial award from ZRA, a state agency, thereby depriving the treasury the much needed resources for service delivery to Zambian citizens.
They have also revealed that Gray had outstanding debts with them, clarifying that their actions in garnishing the US$8 million payment were lawful steps to recover their debts.
In this regard, both Tunta Mining and Lunga Resources vehemently deny any wrongdoing. They say their action to garnish Prestige Motors’ account mirrors the ZRA’s own practice of account garnishment.
“We stand firm in stating that Donovan Gray is a fraudster who fraudulently manipulated the court system to deceive the ZRA out of millions of dollars,” the directors stated.
“Gray’s use of forged documents to secure the fraudulent US$64 million claim against ZRA is a clear violation of the law. Importantly, he has not taken legal action against our companies for garnishing the funds, knowing full well the legal implications of doing so. He understands that our garnishment was a result of a court-ordered process.”
They have advised the police and other investigative wings to take immediate action against Gray to stop his “fraudulent acts.”
“We urge the law enforcement agencies to take decisive action to prevent him from defrauding the government again,” the directors stated.
And according to information obtained by Millennium Radio, the Prestige Motors saga began in 2012 when the company sought tax exemptions to import truck kits under Zambia Development Agency (ZDA) provisions.
While ZRA initially approved duty-free importation of nine trucks, complications arose in 2014 when Prestige Motors applied to clear 39 additional kits.
ZRA denied the request, leading to the detention of the trucks and the start of a protracted legal battle.
This legal battle culminated in a shocking US$64 million High Court judgement against ZRA.
Although ZRA appealed the decision, the appeal was filed too late, leaving the judgement intact and raising concerns about the legitimacy of Prestige Motors’ claims.