The Anti-Corruption Bureau (ACB) says it will cross the borders to investigate some of the cashgate cases, saying it is still working on files that forensic auditors Baker Tilly submitted to the institution to help in investigation and prosecution of those involved in the Malawi Defence Force (MDF cashgate.
Updating the media on Cashgate investigations and prosecutions during a news conference in Blantyre on Wednesday, ACB deputy director general Reyneck Matemba said the bureau received over 60 cashgate files from Baker Tilly.
He said ACB invested Thuso Groups Limited, Top Prima, Rummage Pace, International Procurement Services and S.F International which were linked to military cashgate.
Matemba said ACB investigators will have to follow proper procedures to ably collect evidence from countries like India, Indonesia, Malaysia and Caribbean, among others.
He also said there is some evidence that some of these contractors deposited the money believed to have been stolen at Capital Hill in eight bank accounts in Switzerland.
ACB arrested a former Lieutenant Colonel Nelson Kauwa whose company, Thuso Group was linked to alleged dubious contracts at MDF.
According to ACB, Thuso group had valid contracts with MDF prior to 2013 but the anti-graft busting body found that there was no evidence of a K900 million contract to supply blank bullets to the army.
There were also valid contracts for Top Prima and Rummage Pace to supply goods to MDF amounting to $50 million (equivalent of K16 billion).
The bureau says though most cases which were identified in the Baker Tilly Report are commonly and generally referred to as “cashgate cases” by the public and journalists, it usually refer to “cashgate” as those cases in which payments were made by government but without delivery of goods and services.
“These type of cases are the more straight forward cases and where we have moved quickly by proving that payments were made without valid contracts and delivery of the corresponding goods or services. Most people that have been arrested and charged and convicted have been in respect to such cases,” ACB said in clarification to follow up media queries after the news conference.
It said the case of Rummage Pace and Top Prima were not cashgate but overpricing.
“The Baker Tilly report was based on a population of payments which government had made under the period under review. It identified Rummage Pace and Top Prima as two companies that had received significant payments related to contracts with the Malawi Defense Force (MDF) and Malawi Police Services (MPS). The report raised potential problems with the pricing of goods under these contracts.
“Our investigations have confirmed existence of valid contracts that were entered into with the Government and these two companies for the supply of equipment at the MDF and MPS. We have also traced delivery notes and goods that were ordered and delivered.”
The ACB explained that over pricing of goods and services potentially may indicate existence of corruption “but only if a connection or money trail is identified between the suppliers and public officials who were part of such transaction.”
According to the graft-busting body, their investigations so far have not made such conclusions.
Matemba , who also is a lead ACB prosecutor, was asked if the companies have been cleared because their controversial contracts were done in previous Democratic Progressive Party (DPP), in which he said ACB does not favour any suspect in its investigations.
The bureau also clarified that the contracts were awarded during the People’s Party (PP) regime.
ACB pointed out that it has not experienced any political interference in the ongoing investigations of its cases from any Government officials.
There is no law that criminalises over pricing since the traders determine the prices.
Attorney General Kalekeni Kaphale is on record saying the two companies were not accused of ‘cashgate – obtaining payments from government on services not supplied or rendered – but it’s a suspected case of overcharging.
“My reading of the report, which I have done several times shows that the main issue in the transactions involving the two companies was over pricing,” said Kaphale.
“Prices are agreed by two parties,” he adds.
The Attorney General pointed out those documents in his possession show that the payments were approved by his officer, certainly by his predecessor.
Former army commander Henry Odillo and his former army deputy commander Clement Kafuwa were arrested and implicated as they were signatories of several cheques including K3 billion to international procurement services (IPS) owned by convicted businessperson Oswald Lutepo and K1.5 billion to Thuso Group owned by Alexander Banda and Kauwa
The former army chief was one of three signatories apart from Richard Chidzungu and Harry Chawinga, who signed for three cheques amounting to K1.5 billion going to Thuso group while Kafuwa also signed with Chidzungu and Chawinga for cheques worth K238 million,K339 million,K466 million,K180 million and K220 million going to IPS.
But Odillo’s case has stalled and he has not be taken to court for prosecution.
Malawians would have liked the ‘cashgate’ full scale scandal to be dealt with to its logical conclusion but ACB insists there are legal issues that need thorough investigations and it is meticulously analysing all data before pouncing on the suspected “big fish”. –Additional reporting by Wanga Gwede, Nyasa TimesFollow and Subscribe Nyasa TV :