The High Court’s Commercial Division in Blantyre has set October to hear arguments from all sides involved in the K20.9 billion ‘Bankgate’ case, in which a Pakistani national, currently at large, allegedly defrauded local banks.
Court records show that all parties would be required to present their arguments before the presiding judge Michael Mtambo determines whether to grant Cotton Ginners Africa Limited their application to declare the company bankrupt.
he banks Standard Bank Limited, Ecobank Malawi Limited, CDH Investment Bank, National Bank of Malawi and Reserve Bank of Malawi’s Export Development Fund are objecting the application to have the company declared bankrupt, opting to go after the assets the company gave as securities when obtaining the loans.
But Abdul Kader Patel, one of the directors of Cotton Ginners Africa Limited, proposes cooperation of all the banks and appointment of an administrator to manage the company under supervision of the court.
Patel filed the application after one of the company’s directors, Abdul Rehman, obtained the loans in the name of the company and remitted about K3.6 billion in foreign accounts and fled with his family.
Rehman, the court documents disclose, stayed in Malawi for over 15 years and held both Malawi and Pakistan passports.
According to an audit report by Audit Consult Advisory Services, which was engaged by Cotton Ginners Africa Limited, and is part of the court record, Rehman’s family including inlaws, had booked to leave the country from April 7, according to their travel itinerary.
“All tickets were return and the time has since passed. The tickets have not been changed by the airline on the return dates.
“It is concluded that Abdul [Rehman] planned to leave the country with his family to Pakistan through Dubai. As from our search, he left Malawi on Malawi passport and entered Pakistan using a different passport,” the audit report reads. It emphasises that Rehman is in Pakistan “as he was recently attending a wedding of one of his children”.
The auditors describe Rehman as a man with strong negotiating skills and a person who knows exactly what he is doing, explaining that as for Cotton Ginners, he ensured that all relevant documentation or registrations were in order with relevant institutions or authorities.
The company, Cotton Ginners Africa Limited, was incorporated under the Malawi Companies Act. The court record reads that Rehman was made managing director and company secretary, in charge of day-to-day running and management of the company.
The major victim of the alleged ‘Bankgate’ is Standard Bank Limited, K8 585 177 082, followed by 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.