Malawi Police make fresh arrest in K20 bn ‘Bankgate’: Farook Ibrahim of British origin charged with money laundering

Malawi Police Service Fiscal and Fraud Section has made a fresh arrest in a matter which some commercial banks in the country were defrauded out of at least K20.9 billion after a Pakistani businessperson, who was one of the directors at a local cotton company, obtained loan facilities totalling K20.9 billion and fled the country.

Cotton Ginners Africa Limited board chairperson Mahommed Farook Ibrahim was picked by Police for interrogation on suspicion of playing a role in the fraud.

Abdul Yasin Reiman charged with theft, fraud and money laundering

Fiscal Police head Isaac Norman said Ibrahim, of British origin, was arrested on Friday and is being jointly charged with a Pakistan national Abdul Rehman arrested last week Tuesday.

“We have charged the two with theft, fraud and money laundering offences,” said Norman.

He kept further details close to his chest to avoid jeopardising the investigations.

Rehman, one of directors at Cotton Ginners Africa Limited before he left Malawi with his family in April, was brought into the country last Tuesday and he immediately landed in the hands of law enforcers who interrogated him for hours.

The businessperson was traced in Pakistan by Malawian private investigators with the help of Pakistani authorities and brought into the country to the relief of the banks that granted the loans and proprietors and directors of Cotton Ginners.

While Rehman was away, Cotton Ginners Africa Limited applied for bankruptcy at the Commercial Court in Blantyre, an application the banks challenged.

Rehman is believed to have remitted over $5 million (over K3.6 billion at the current exchange rate) in foreign accounts, according to an audit report by Audit Consult Advisory Services Limited dated July 23 2017, which is contained in court documents.

The major victim of the suspected fraud is Standard Bank Limited, which is owed K8 585 177 082, followed by Reserve Bank of Malawi’s Export Development Fund (K4 092 547 425), Ecobank Malawi Limited (K3 499 481 627), CDH Investment Bank (K4 476 302 691) and National Bank of Malawi (K250 000 000).

The total amount at stake is K20 903 508 825, but it has also been established that the total liabilities for Cotton Ginners Africa Limited is K23 656 808 338, with the company’s total assets pegged at K10 011 666 092.

The company requires K13.2 billion to return to solvency, court documents we saw indicated.

The local banks, in a move to recover their money and save their reputations, teamed up to object the bankruptcy application that remaining directors of Cotton Ginners filed at the High Court’s Commercial Court Division in Blantyre.

Follow and Subscribe Nyasa TV :

Please share this Article if you like Email This Post Email This Post

More From the World

Sort by:   newest | oldest | most voted
Mzozodo
Guest

A mwenye anu mumawakhulupilira aja ndi awo akuthawani ndi ngongole wo. I remember being denied K150, 000 in 2011 which I wanted to top up to purchase a vehicle at FMB yet they were sure that they would be recovering that from my monthly salary. That was an equivalent of K750, 000 at present day. this was despite providing with a letter from my employer, being a Civil Servant.

699942
Guest

I am happy for standard bank.. kulanda nyumba za anthu kumagulitsana ma staff at giveaway prices. Akuchitani bwino.

Timve Ziti
Guest

Every one commenting here is of the same opinion. Akutchitani bwino. Aren’t banks supposed to check with other banks on loans. You all knew what loans they had but would still give more? And I supposed over inflated values on collateral. Well done Rehman.

mwakhuyu@gmail.com
Guest

Ma Bank aku Malawi anakuchitani bwino no wonder maluzi amavuta chonsecho ndalama anadya anthu obwera

dinky
Guest

mwanyanya kubwereketsa anthu oyera khungu akuchitani bwino ifeyo kutikaniza zingongolezo mwanya basi olo mummange khobidi zapita basi and its a lesson to all banks

KIEMBE SAMAKI
Guest

These Asians should be Iddi Amined

Amwenye weni weni
Guest

You monkeys cant run a country, you belong in the zoo

Azijo
Guest
As much as we say sorry to the banks but our banks are fond of trusting foreigners. This shows how incompetent our banks are how were all these loans be taken against what security as the time the other loan was being taken the documents used as security (bond) were with the other bank. Again government check these called Chinese investors who are operating by selling very low low quality of China made stuff they have their own syndicate as well it will be too late before government comes to it’s senses that they have been syphoning dollars out our… Read more »
benjones
Guest

What goes round comes round. I am happy both for the bank to have been cheated for such a huge amount and also for there foreigners who have just exposed each other. But my question is will anything come out of this or it will eventually die a natural death.

Achi
Guest

What? These are the same banks that deny local Malawians to access soft loans to financial freedom yet they can afford to support non-Malawians to prosper in our very land and before our very faces.
Malawi sazatheka –
Even our very banks where our very sons and daughters make decisions, can’t trust us and bankroll our SMEs to grow into big companies.
Lero ndi izi.

alungwana
Guest

This is just alot of money. I think now the local banks will start trusting the local Malawians to access loans. You trusted the foreigners thinking they are capable. Now you see it!!

Former Makawian Indian
Guest
Former Makawian Indian

I bet any money these guys will walk free as there is too much corruption. Lock these guys up and throw the keys away. They are termites eating the country away

Former Makawian Indian
Guest
Former Makawian Indian

I bet you any money these guys will walk free as there is too much corruotion in Malawi. Only black malawians go to orison.put these guys behind bars and throw the keys away so it becomes a lesson for others. Malawians wake up these crooks are chewing the country to bits

wpDiscuz

More From Nyasatimes