CDH Investment Bank chief executive officer (CEO), Misheck Esau will vigorously contest his charges slapped by the Anti-Corruption Bureau (ACB) on allegations of suspected financial crimes related to Zameer Karim of Pioneer Investments who is riddled in the Police food rations deal, the bank’s board of directors have said.
Esau was for allegedly failing to conduct due diligence and monitor business relationship and the transactions of Pioneer Investments, a contractor in the controversial K2.7 billion Malawi Police Service (MPS) food rations deal, with the financial institution.
The case came to light last June through a leaked ACB investigation report which indicated that government paid K2.7 billion directly to Pioneer Investment against an undertaking by an officer at MPS to pay the contract price to CDH investment Bank Limited. The direct payment to the contractor saw the bank losing out; hence, the court action.
But the bank’s board of directors in a statement made available to Nyasa Times said CDH Investment Bank is “shocked” and “astounded” by the accusations of the ACB.
The statement signed by the bank’s Company Secretary Daniel Mwangwela said Esau has assured the Board that he has not committed any personal wrong doing connected with the charges.
“The Board totally refutes these allegations and they will be vigorously contested in court. The transaction at issue, upon verification and authentication of a supply contract between Government and Pioneer Investments, the Government gave an undertaking to CDHIB to pay all contract proceeds into Pioneer’s account with CDHIB,” reads the statement.
“On the back of the Government undertaking, the Bank provided finance to Pioneer Investments to fulfil the supply contract with the Government. The Government confirmed delivery of the goods by Pioneer.
“In spite of the undertaking, the Government was in breach and paid the contract proceeds directly to Pioneer Investments. The Bank successfully sued both Pioneer Investments and the Government to recover the money owed to it,” reads the statement.
CDH Investment Bank said it will “robustly” pursue all avenues available to it at law to recover the debt in full, and any losses and damages it may suffer.
“The Bank assures all customers that there is no disruption to the Bank’s business due to this unfortunate occurence. Mr Esau has stepped aside from the position as CEO/MD of the Bank to pave way for investigations into the allegations.”
The statement further says the bank’s Deputy Chief Executive Officer, Jean Rene Ngando Moukala, has assumed the duties and responsibilities of chief executive officer in an acting capacity.
Esau faces charges of conspiracy contrary to Section 35 as read with Section 25 B of the Corrupt Practices Act (CPA); Failure to conduct due diligence and monitoring contrary to Section 29 of the Financial Crimes Act; influencing the use of public office for advantage contrary to Section 25B (2) of the CPA and money laundering contrary to Section 42 (1) (c) of the Financial Crimes Act.
The case has since been adjourned to March 21 2019.
Both prosecution and defence lawyers said the case is expected to be committed to the High Court where other suspects, including Zameer Karim of Pioneer Investments, are also answering charges on the dubious K2.7 billion deal.
The investigation report also mentioned the governing Democratic Progressive Party (DPP) as a beneficiary of the proceeds as Karim deposited K145 million into its bank account at Standard Bank whose sole signatory was President Peter Mutharika.Follow and Subscribe Nyasa TV :