Lutepo now faces tax evasion charges

Public tax collector, Malawi Revenue Authority (MRA) obtained an arrest warrant for businessman Oswald Lutepo, a prime suspect in the plundering of public funds dubbed cashgate scandal for tax evasion.

Lutepo was earmarked for arrest on Friday together with former Ministry Finance Budget Director Paul Mphwiyo, businessmen Shiraz Ferreira and Nelson Johannes Kauwa.  He was not arrested but the three were picked on tax evasion charges.

MRA suspects an evading tax of about K1.8 billion (about $3.6m) from 2011 to 2014. The alleged evasion relates to non-payment of value-added tax (VAT) and income tax.

Lutepo said he will give details in how “tax has been embezzled and continue to be embezzled, I know the process and I am ready to disclose.”

The chief cashgate suspect told a Zodiak Broadcasting Station that he is “in hiding” for fear of his life after admitting wrongdoing in the cashgate and then implicating former president Joyce Banda as the “main beneficiary”, claiming he was giving her some of his stolen money for political campaign.

The former president dismissed the allegation as “false” and “malicious.”

MRA sources said Lutepo faces arrest.

“We are interested in questioning him,” said an investigator at the public tax collector.

MRA working jointly with Anti Corruption Bureau (ACB) and Financial Intelligence Unit are following the leads in the billions paid by Malawi Defence Force through cashgate tainted contracts.

Two companies, International Procurement Services and OG Construction, owned by Lutepo pocketed $6.2-million. Lutepo is being tried by the high court on charges of laundering, theft and attempted murder.

Gun-shot survivor Mphwiyo, Ferreira and Kauwa were arrested on Friday and remained in police custody at the time of posting this story.

Ferreira trade as SF International while Kauwa is the co-owner of Thuso Group with Alexander Banda, according to Steven Kapoloma, MRA Deputy Director Corporate Affairs.

Kapoloma said they could not divulge specific information as investigations were continuing.

“The accused persons will appear in court soon to answer criminal charges,” said Kapoloma.