Malawi Congress Party lawmaker Peter Dimba picked the controversial recapitalisation of state-owned Malawi Savings Bank (MSB) to parliament and described it as one of the most heinous corruption scandals, saying government has shielded loan defaulters with tax payers money.
Government has come under intense criticism for injecting K6 billion into MSB to clear off toxic assets instead of simply asking those that owe the bank to repay their loans.
Dimba described the sale and repayment of the loans as “daylight robbery” by government which wants the sale to take place with only one preferred bidder also considered successful in dark rooms.
The lawmaker told parliament that Mulli Brothers Limited and other companies and persons obtained over K6 billion (US$13 million) in loans “to finance” the campaign of the ruling Democratic Progressive Party (DPP), saying government’s decision to take over MSB’s toxic loans is another form of cashgate.
“Mr Speaker, sir, we are experiencing one of the most heinous corruption scandals whose masterminds are the Minister of Finance, the RBM [Reserve Bank of Malawi]governor, some Cabinet ministers and party officials,” said Dimba.
Dimba said his party has evidence indicating that government wants to hand over the bank to FDH Bank, owned by Thom Mpinganjira, whom he described as “Mutharika’s crony, tribesman, DPP campaign financier who sits on the public reforms commission.”
The MP said opposition will not allow “this madness “to continue, saying they will hold budget to ransom until the people’s bank deal is cleared.
He said: “In fact, the MSB corruption scandal will have to be sorted out first before we even begin discussing the budget. Government will have to rescind this theft otherwise the Finance Minister will dance with the budget in this august House.”
MP Joseph Njobvuyalema backed Dimba and pointed out that many lawmakers were opposed to the sale and described it as “a robbery which will be stopped.”
Major on the list of the toxic loans, which government has taken over, is the Mulli Brothers Limited (MBL) loan, which stands at K4 969 043 316.93.
Other defaulters included Varibo Spirits—owned by Duncan Kaonga—at K397 763 522.07, KJ Transways owned by a Mr Mkumba has a K172 536 106.23 loan that has not been serviced, Ganizani Transport owned by Charles Fungula owes the bank K97 908 785.35.
MSB is owed K83 960 954.29 by Maranatha Institute of Education of Ernest Kaonga, K71 220 602.47 from Consolidated Building Contractors owned by Peter Mhone, K69 776 370.81 from CK Construction of Chester Makuwira.
The bank is also failing to collect K68 034 537.28 from Fincoop, K65 910 536.30 from K’s Investments owned by Bintony Kutsaira, K30 717 180.76 from MGI Trading of Macpharen Mpeta Phiri, K27 179 448.51 of Injena Petroleum Limited, K20 722 510.70 of Angel Wings owned by Angel Chaponda Nazombe and K12 782 074.13 of Eranive Trading for Fanny Joshua.
Dimba told parliament that ” the tax payer is paying on behalf of Mulli and other 12 private defaulters as though they were declared bankrupt.”
Following continued concerns by government benches over issues that Dimba raised, which among others included calling President Mutharika, Finance Minister Goodal Gondwe and Reserve Bank Governor Charles Chuka, as masterminds of the sale of the bank, the Speaker Richard Msowoya asked Dimba to bring evidence on the allegations to the House on Monday.
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