Malawi banks which cleared cashgate cheques named and shamed

Malawi government on Thursday made public an audit report that among other details, reveals the of commercial banks that made transactions of the plunder of billions of kwachas from government coffers.

Tembenu: Report released as a  matter of public interest

Tembenu: Report released as a matter of public interest

The scandal, famously known as Cashgate, led donors to suspend about $150m in budget support and aid to the Southern African nation. Malawi’s International Monetary Fund program also went off track because of the scandal.

Minister of Justice Sam Tembenu told reporters the 124-page Cashgate audit report conducted by British auditing firm Baker Tilly was ready for release on September 25, but the government has been consulting with law enforcement agencies that gave the go-ahead to make it public.

According to the report, 104 ‘cashgate’ cheques were paid into at least ten different commercial banks throughout Malawi with the highest amount deposited in Standard Bank (49 %).  In comparison the lowest amount (1%) was deposited into OIBM.

The report says 22 cheques from 10 different businesses were banked at Standard Bank representing 49% of the ‘cashgate’ funds.

Analysis of the cheques deposited into Standard Bank shows the majority of this amount relates to two businesses being;  IPS and O&G Constructions  who  received  MK 1,860,584,273 and MK 1,140,738,209, respectively.

“These amounts total MK 3,001,322,562 which is 43.4% of the total ‘cashgate’ cheques. Both businesses are owned by Osward Lutepo,” reads the report in part.

Lutepo is the chief suspect in the cashgate scandal and is answering multiple charges.

“The second and third highest amounts were deposited in to [National Bank of Malawi] NBM and FDH Bank which received MK 970,620,798 and MK 898,276,664, respectively,” reads the report.

“ NBM was also the bank in which the highest number of cashgate cheques were deposited (28 out of 104) and the bank with which the highest number of businesses who were recipients of cashgate cheques held bank accounts (12 out of 39).”

The reports says the three banks which received the most cashgate cheques were Standard Bank, NBM and FDH Bank who between them received MK 5,219,344,243 (75.5%) of all the cashgate funds. The remaining 24.5% was split between at least seven different banks.

Baker Tilly said in the report that the audit is not a document suitable for legal use and is drafted for informational purposes and that “only further work will be required should there be a requirement for it to be relied upon in court or any other legal situation.”

It said the report is based on the facts established from documentation provided by the various representatives of the government, Reserve Bank of Malawi, various commercial banks, individuals and funding recipients interviewed.

“Where appropriate we have made reference to additional information and explanations obtained during the course of this review,” it explained.

Justice Minister Tembenu said government made a decision to release the report as “a matter of public interest,” saying now that the audit document is in public domain it will “end public speculation on what is contained in the report.”

Baker Tilly noted that during the evidence gathering phase of the audit NBM, the bank in to which the second high amount of cashgate cheques was deposited were unable to provide five of the 13 bank mandates requested from them.

“It is not clear if this was an attempt to block our work or relates to poor record keeping and ineffective internal controls operating within the NBM,” reads the report.

Contrary to popular expectation, names of suspects who allegedly stole from the public funds did not include senior politicians, including former president Joyce Banda and Vice President Khumbo Kachali whose names were linked to the scandal.

The report also names three law firms which benefited from “Cashgate funds” including the firm of former justice minister Ralph Kasambara.

The former minister is already answering charges related to Cashgate, which involve an attempted murder against former treasury official Paul Mphwiyo.

The ‘Cashgate’ involved a systematic plunder that involved public officers conniving with private sector firms and  individuals.

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Kaya
Guest

Bank nooo suzgo kweni mwawanthu…..kkkkkkkkkkkkkk.

patie
Guest

let justice flow like water .zimangidwe mbava zimenezi.makutu azo.

gift
Guest

lamulo ligwile ntchito basi,amene akukhudzidwa alandire mphoto yake,aliyese paja amalandira ndintchto zake,mbava imakhala imene yagwidwa ndipo ngati wina anaba mbuyomu sizikumukhudza,kuthana ndiamene wagwidwayo basi,,amene akulamulira panowa akaba nthawi yawo izakwana tizawagwiraso,ndipo kulibe kunyengerela mwana ,mai,bambo,ili ngati ebola

Pastor nyalapa
Guest

Was that the banks problem? Banks role is keeping pipos cash bank can not have much real imfo about how everyone gets cash.

Kenkkk
Guest

Banks in other countries have the legal duty or right to question and report to crime authorities any deposit of money above a certain amount unless it is properly explained by the depositor how they got that money.

DA
Guest

You see! Everyone was saying FMB was the main cashgate bank but look, it isn’t even one of the main banks keeping cashgate money despite being the third largest! FMB is Malawi’s best bank!

Mzuma
Guest

I am happy wt the justice. Koma ndalama za Bingu’s zisakidwenso.

Kenkkk
Guest

By telling or ordering banks to honour all govt cheques, the birth of cashgate started!!!! You now know that DPP created this monster!!!

yavundika
Guest

imwe vilekani waka ivo;I see not even 1 wu’s capable of helping us malawian,lets jst wait for they thos claiming innocent r doin d same thng…lindizyani muzamuona..

Kenkkk
Guest

Yebo chomene!!!

mona
Guest

Don’t blame banks blame mbava yaikulu bingu chi muntharika who ordered these commercial banks to honour all government cheques regardless of the amount. Signatories also should be taken to task asaina bwanji Cheque osadziwa chomwe akulipira

Gongoni
Guest

HOW COULD BILLIONS OF MONEY BE PAID OUT FROM THE OFFICE OF PRESIDENT AND CABINET WITHOUT THE PRESIDENT AND CABINET KNOWING? SINCE WHEN DID THE OPC START PAYING CONSTRUCTION COMPANIES? JOYCE BANDA MBAVA YAIKAZI YAIKULU!

John Kevin
Guest

it was not the banks fault

Eye Opener
Guest

Mukulimbana ndi anthu okuba mbuzi mu ndende zanu koma a Malawi akuzunzika, Kwacha ikugwa daily anthu kumuzi akuvutika pamene inu muli ndi ma deni mu Lilongwe umu mukubera amphawi, nsonkho wa ma primary teachers, police ofcers….. MULI NDI SOKA… MKWABWINO MWALA AUKOLOWEKE NKHOSI LANU MKUKUPONYANI MMADZI INU ANTHU AKUDIEREKEZA!! A Lutepo mmayetsa ndinu wa SDA inu? God is watchng!

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