Malawi law enforcement agencies deadlocked on arrest of Indians over cash externalisation

Heads of six state agencies are yet to append their signatures to a Memorandum of Understanding (MOU) to kick start an operation code named, Operation Kuluma, aimed at investigating and prosecuting financial crimes in Malawi.

DPP Mary Kachalecertified in the certificates of summary procedure trial criminal case

The agencies are, Reserve Bank of Malawi (RBM), the Malawi Revenue Authority (MRA), the Anti-Corruption Bureau (ACB), the Financial Intelligence Unit (FIU) and the Malawi Police Service, according to documents seen by Nyasa Times.

The delay in putting in motion Operation Kuluma and or changing the country’s regulatory framework regarding financial crimes is a blow to the ruling Democratic Progressive Party (DPP) which is trying to plug financial holes occasioned by a donor freeze in the wake of the Cashgate scandal —the plunder of public resources at Capital Hill.

A leaked memo from the central bank Governor Charles Chuka dated 8th November 2016 to the Solicitor General and Secretary for Justice shows that the FIU is stonewalling the review of the Money Laundering and Terrorist Financing Bill.

At the meeting held from 24th to 26th October, 2016 at Game Haven Lodge in Thyolo District involving officials from the  RBM, FIU and  Ministry of Finance and Ministry of Justice on the review of (the Bill) – there was no consensus regarding the demarcation of supervisory roles between the Registrar of Financial Institutions and the Financial Intelligence Unit.

“There was further no consensus on whether the Registrar of Financial Institutions should have powers to issue freezing directives against accounts suspected to have been involved in financial crimes and on the need to criminalise operating fictitious/ghost accounts since there is no law that criminalises opening and operation of fictitious accounts,” Chuka said.

President Peter Mutharika said in May 2016 when he opened the RBM  Mzuzu branch that forex externalization is aggravating people’s poverty.

“This country is losing a lot of money in forex externalization. We are losing more money than the aid we need from anywhere. We must hurry to arrest and slay this monster of forex externalization once and for all,” Mutharika said.

The MOU, which has been chalked by the six state agencies, relates to the investigation and prosecution of offences against the Money Laundering, Proceeds of Serious Crime and Terrorist Financing Act, 2006 [MLA]; Exchange Control Act, 1984 [ECA]; Customs & Excise Act, 1969 [CEA]; Regulations thereunder; and the Penal Code of Malawi.

“Recognizing the damage done to the economy of Malawi by the depletion of its foreign currency reserves and noting the high probability that proceeds of crime have been laundered and sent out of the jurisdiction of Malawi’s courts,

“The Parties to this MOU agree to co-ordinate, co-operate and collaborate at all stages of the investigations and prosecutions of the individuals and companies implicated in the criminality [the suspects]” reads part of the MOU.

Operation Kuluma has initially targeted 13 Indian owned companies who allegedly externalized MK2,657,069,609 in eight separate transactions.

The companies and individuals are: AMAD, M R – Intertrade Agency and Mozimpex, USMAN, S and  BILAL, S – Hasbro Ltd and Verizon, ARIF, M – Noor General Distributors and TS Distributors, RAZZAQ/RAZAQ, M and MANJARA, A S I – ZamZam Import & Export , GANI, S G and RAZA, N – Premium Commodity Traders Fawa Products; Tarar Enterprises Hong Kong: Vic Charm Ltd, S S  [FRS Co Ltd; BT Trading Co; Al Johara; Nantong JunloveInt; HK Polymers], Musa Karim Ibrahiam of Zambezia Traders and Naeen M. Iqbal.

Broadly, the offences involve the making and use of false documents and deceptions by persons applying for permission to remit abroad large sums of foreign currency.

For instance, Mahomed Rafiq Amad, Managing Director of Intertrade Agency faces nine counts involving the externalization of a total of US$2,058,000.

Under count one, Amad is alleged to have used a Customs Declaration Form Number C80 of 31/08/13 of Chiponde Border valued at US$768,000.00, in support of an application madeto CDH Investment Bank for remittance of the said sum of VIC CHARM LIMITED of Hong Kong, purportedly to pre-clear 4,500 Metric Tonnes imported Cotton seed, when in actual fact no such importation was ever made, thereby fraudulently externalization the said US$768,000.00 from Malawi.

It is also alleged that on or about the 2nd day of September, 2013 at CDH Investment Bank in the City of Blantyre, Amad was in possession of US$720,000.00 which he knew or had reason to believe represented, in whole or in part, directly or indirectly, the proceeds of illegally obtained foreign currency.

It is also alleged that on or about the 7th day of October, 2010 at CDH Investment Bank in the City of Blantyre using Account Number 0020135092200 and Account Name Intertrade Agency obtained foreign currency amounting to US$570,000.00 for the purpose of payment of goods imported, namely, cotton seeds from Mozimpex of Mozambique, when in fact no such goods were imported.

Similarly, two other Indians, Lakhu Mohamed Naeem M Iqbal face 13 counts ranging from forgery of official documents, making a false document without authority, uttering a false document to illegally obtaining foreign currency.

Court documents show that the duo on five separate occasions externalized a total of MK1,154,729, 609.

Director of Public Prosecutions (DPP) Mary Kachale certified in the certificates of summary procedure trial criminal case number 824 of 2014 and Criminal Case Number 234 of 2011 that the cases were proper for trial by the High Court as summary procedure cases.

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misozi banda
Guest

they get protected bcoz they buy the MRA ETC staff -mra cars , smart fones. munawaona ena oti samatha kuona bwinobwino za internetzi but bcoz they are in line with the rest in the deptment- to seal their lips. kuti alowetse katundu mwaulelr. takaonani ku KIA CILEKA. ZOOPSATU . immigration nde nyasi. ma polisi mayo ine cinyengo +++++++++++++++++++++++++++

James Mpata
Guest

Just why does this breed get such protection when we cannot get same in their countries? These guys are milking us in day light and there is nothing we are doing as a country!

James Mpata
Guest

Just why does this breed get special protection when we cannot get this in India or Pakistan?

Iigeni
Guest

Where did you get this story? Now with all those details si basi amwenyewo athawa? It is sad though that the 6 agencies are not taking action but truly amwenye can be more corrupt and deplete our resources.

2pu
Guest

Amwenye ozadziwika awa.don’t waste your time.agwileni ma big fish..achina OG….

frank
Guest

Dziko lathu malamulo ake amagwirizana ndi ife eni wake, chifukwa alendowa akalakwa amakapereka ziphuphu milandu ndikutha, pamene alakwe galu ngati ineyo basi ukathera kundende, akuluakulu a MRA. Immigration. Apolice ndi inuyo mumawathandiza amwenyeo kupanga zinthu zachinyengo

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