Earlier this month, we posted a summary of the findings of an audit of the now defunct Hypercube Hub. The audit was carried out by a Recovery Manager hired for this process. The audit found that some members of the Hypercube founding team and management of the hub may have abused funds.
We contacted all the founders – Rinesh Desai, Nigel Mugamu, Nikki Kershaw, Munyaradzi Chiura, Tapfumanei Murove and Nicola Kershaw – to get their comments on the allegations of abuse of funds in the report. None of them came back to us on record, with those who wrote back asking that we don’t use their responses.
The Recovery Manager has however since released more information to provide additional details of his findings. The new information includes an apparent statement from Hivos confirming that they stopped funding the hub and blacklisted it because their own audit had disclosed irregularities.
According to the report, the statement was given by Tanja Lubbers, the Regional Director of Hivos – Southern Africa on 15 March 2016. It reads:
“In August 2015, we informed Hypercube Board and management that we would conduct a financial inspection which would be conducted by an Independent Financial Consultant. The purpose of the inspection was to verify financial management systems in place as well as compliance with specific donor agreements and to make recommendations on areas requiring improvements. The inspection was undertaken in line with Article 7.1 of the Hivos General Conditions, which states; “Hivos is authorized to institute an audit of the implementing organization with a view of checking the use of the funds made available. The organization must cooperate in such an audit in every way necessary.”
The Financial inspection was undertaken and a briefing of the findings was tabled on 13 October 2015 (in the presence of the Hypercube Board and management representatives) and some of the findings revealed the existence of a number of Governance and Financial management irregularities affecting Hivos and other donors that had funded the organization. Following from this outcome, there was an extensive consultation with the control unit at the HivosGlobal Office which culminated in the decision to terminate the contract with Hypercube with immediate effect and to place the organization on a blacklist. This was duly communicated to the Board and management of Hypercube on 11 November 2016.
One of the main reasons for terminating the contract was related to the fact that Hypercube Board Management were informed about some of the anomalies by other donors but the organization had not taken timely steps to address the concerns.”
We contacted Hivos to get their comment on this new information but the email has not been responded to 6 days later.
Before this new information, when we asked Hivos about the matter, they admitted that their contract with Hypercube was terminated at some point, but did not provide the details of why this happened. Then, they responded within a day.
Confirmation that they terminated and blacklisted an organisation that was potentially abusing funds is actually positive for Hivos so it’s strange that they’d want to stay away from doing so. The problem however may be that other funder of the project, the US Embassy, have so far indicated they didn’t have major problems with what happened at Hypercube and how it ended. At least none deserving any blacklisting.
Hivos therefore might view admitting that there were serious fund abuse problems at Hypercube as unnecessarily upsetting the apple cart of Zimbabwe’s NGO funding ecosystem.
As usual we will post an update if they eventually respond.