Former Vice President Khumbo Hastings Kachali has alleged that the Democratic Progressive Party (DPP) administration authorized Reserve Bank of Malawi (RBM) to borrow over US$350 million from Afrexim Bank, which was diverted to FDH Bank for sharing among party functionaries.
And due to that borrowing, Malawi now owes Afrexim Bank US$800 million, Kachali says.
However, sources at the Reserve Bank of Malawi have laughed off the former vice president’s accusation as bordering on ignorance.
“It is sad that we have a “big ignorant” former vice president with zero knowledge of economics and how money markets function. He is lying to the public and public must quiz him on what he did during Cashgate. He should not be allowed to look clever and intelligent while we all know when he was in power his party and leadership stole from the same people he is lying to,” said our source.
Writing on his Facebook page on Tuesday, the former vice president attributed the prevailing forex scarcity and shortage of fuel to this loan.
“During Peter Mutharika’s rule, RBM borrowed over US$350 million from Afrexim Bank. Katapila weniweni because we now owe Afrexim Bank US$800million. Painfully, the money was fraudulently diverted to FDH Bank. It was reported as an inflow by an investor and not as a loan.
“To disguise this, FDH sold the borrowed money to RBM and made a whopping MK10.4 billion profit within just two hours. This money was shared between FDH and crooked DPP party functionaries,” says Kachali.
He adds that RBM then paid Malawi Government the Malawi Kwacha equivalent of US$350 million thus committing it to the loan.
Government is still repaying the loan, Kachali says.
“IMF started questioning Government payments to Afrexim Bank. Obviously, IMF would have discovered this loan on its own which forced Chakwera’s administration to explain this fraudulent transaction.
“Currently, ex-DPP Finance Minister, Joseph Mwanamvekha was arrested and is answering charges in court on this issue. Ex RBM Governor, Dalitso Kabambe, ex-Deputy RBM Governor, Henry Mathanga, ex-RBM Director Rhodrick Wiyo and RBM Manager Leya Ndonga, all Lhomwes according to prison records, spent weeks remanded at Maula Prison because of the same issue.
“Peter Mutharika will now accuse Chakwera of targeting a particular tribe when all he did was appoint corrupt frauds from that tribe.
“Assuredly, we don’t want to dwell in the past and we are working to find a lasting solution to the forex issue but Peter Mutharika is certainly not one we can solicit that advice from,” stated Kachali.Follow and Subscribe Nyasa TV :