Malawi commercial banks blamed on Capital Hill money scam

Some banks operating in the country have been blamed for heavily contributing to the Capital Hill Cash-gate scandal because they failed to report dubious bank transactions in some of their bank accounts.

Failure by these banks to report to Financial Intelligence Unit (FIU) on transactions of over K1 billion connected to the scandal, may have led to failure by authorities to notice and act on the transactions.

These were the remarks of the newly appointed Minister of Justice and Constitutional Affairs Fahad Assani to journalists after making his statement in parliament Wednesday afternoon. He said that there are two banks in the country which will be taken to task for failing to comply with the money laundering law.

“This country has laws which stipulate what to do when it comes to money laundering. These laws stipulate that for everyone who has deposited cash of above K1 million, the Reserve Bank’s intelligence unit is supposed to know for further scrutiny.

Assani: Banks to blame
Assani: Banks role in the scam to be reviewed

“But these banks in question did not inform the RBM of these deposits and the subsequent immediate withdraws which was going against the laws. They looked the other way when huge sums of money were being drawn from their accounts without raising an alarm with the FIU.

“FIU would always come in when they have been advised of some suspicious transactions. This was not done and the banks should have an explanation to make,” said Assani.

The Minister said they would be working with the RBM governor to summon and have talks with the banks. He further stressed that the most important thing to be looking at now is that this was a very colossal and huge loss to the government as such the banks too have to suffer the consequences.

He highlighted that another aim of the talks would be to see what the banks did in the whole saga and find out how the money transacted unlawfully can be collected back.

During his statement in Parliament, Assani also pointed out that authorization of bank cheques by some banks during holidays may have also contributed to the scandal.

However, Assani also indicated that the investigations into the scandal would also extend to other parties in the private sector.

“We have done this in realization that when these civil servants were taking these monies; they were collaborating with some members in the private sector who are involved in some businesses in the country.

“What was happening is that when these civil servants took the money, they used to share it with these business people. So, because these business people were the ones collecting the money; it is important that we investigate them and find out what they did with it. Again, it will also not be difficult to collect back the money because the companies with the businesses are the ones with the money,” said Assani.

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