Auditor General to review names, add new suspects in 13 files of Cashgate

The National Audit Office (NAO) is set to recall some names of companies and businesspersons implicated in the K230 billion Cashgate report presented to he Anti-Corruption Bureau (ACB) and add fresh names, Nyasa Times understands.

The Auditor General presented 13 files to ACB out of the larger dossiers with names of companies and businesspersons   who  were already cleared  in 2013 forensic report.

Auditor General Stepheson Kamphasa forwarded the same details to ACB of the names which appeared in 2013 report but letter cleared.

ACB observed the information in the 13 files has been imported from the K20 billion cashgate report covering the period April to September 2013 and that not much fresh information has come out of the new audit.

But as seen by Nyasa Times some of the companies were included in the cashgate report in 2013 on suspicion that they overcharged.

Attorney General Kalekeni Kaphale said that the payments government made to the companies were dully cleared by his office and were included in the report on suspicion that they overcharged.

Kaphale said it was matter of pricing not cashgate by some companies who offered services to the Malawi Defence Force and the Malawi Police Service.

In a memo seen by Nyasa Times from National Audit Office date 2 May 2013 to Secretary of Treasury reference AUD/ST/4/1, deputy auditor general verified that over K7 billion paid to 18 firms were “legitimate amount.”

He said National Audit Office examined invoices and verified the delivery.

Attorney General said the firms were not accused of ‘cashgate – obtaining payments from government on services not supplied or rendered – but 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, about the 2013 cashgate report the information which has been pasted in the current audit.

He said “Prices are agreed by two parties.”

The Attorney General pointed out those documents in his possession show that the payments were approved by his officer, certainly by his predecessor.

“Government normally does not buy from the source. It buys from middlemen. Middlemen usually quote their prices higher,” Kaphale is on record saying.

Attorney General said the  matter of overpricing is “outside the modus operandi of cashgate.”

He said: “When you look at the report, you have people who didn’t supply anything, yet they got payment.”

ACB director Lukas Kondowe said he receiving thelegal  opinion from Attorney General  who asked names not to be publicised  as government is yet to verify any wrongdoing on part of the implicated companies.

Kondowe said  companies could sue government “ in the event that the names are published and no wrongdoing is found.”

The Cashgate  scandal, which originated in 2005, prompted foreign donors – who provide around 40% of Malawi’s budget – to pull the plug on aid worth around $150m.

An audit ordered by former president Jouyce Banda found that $30m had been looted by officials in less than six months in 2013.

Dozens of civil servants, business people and politicians have been implicated in the scam.

Several of cabinet ministers have reportedly been implicated in the Cashgate investigations and President Peter Mutharika has been accused of shielding them by refusing to name them.

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