Tougher law drives away Zimbabwe’s street dealers of foreign currency

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Illegal money changers disappeared from the streets on Friday after Zimbabwe passed a law to jail offenders for up to 10 years.

The government on Thursday gazetted a Statutory Instrument that allows for the arrest and prosecution of illegal currency dealers and authorizes the police to seize the cash being transacted.

Harare’s streets, especially around Eastgate Mall in the central business district and a cross-border bus terminal to the east, had become hotspots for illegal foreign currency dealers who have partly been blamed for the economic hardships the country faces, particularly the cash crisis.

While banks have been short of cash, including the surrogate bond notes, illegal cash vendors have been making brisk business in the streets selling the U.S. dollar at a premium.

However, there was general calm in the trade zone Friday as the vendors went underground, leaving their makeshift tables and chairs unattended on the pavements.

A traffic marshal at Eastgate Mall said they were scared of being imprisoned, while a worker in one of the nearby shops said “they are still around”.

“They are simply going to use cell phones to communicate with their clients and will just stop flashing the money in public,” she said.

The new regulations also impose several other penalties including the freezing of funds, if the illegal deals are conducted through banks, while the courts may impose fines three times the value of the currency confiscated.

Prior to the new regulations, the Banking Act only allowed the central bank to impose penalties on offenders.

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