Malawi police sabotaged Cashgate probe
The Malawi Police Service (MPS) erected impenetrable barriers to sabotage investigations into the K3 billion fraud that involved police officers and civil servants at the Accountant General Department (AGD), Nation on Sunday can reveal.
The tactics MPS used to frustrate the probe were consistent with an institution that wanted the fraud buried and forgotten.
Our sister paper Weekend Nation reported on Saturday that by November 24 2011, the Financial Intelligence Unit (FIU) had submitted 48 reports to police covering the period between 2008 and 2011.
A memo prepared by Reserve Bank of Malawi (RBM) governor at the time Dr Perks Ligoya to former president Bingu wa Mutharika raises several critical red flags that demonstrated collusion at MPS to undermine the investigations.
First, says the memo, investigators in the case allowed interdicted officers implicated in the fraud to continue signing police cheques. When one is interdicted from the public service, you forfeit the right to transact business on behalf of government.
More bizarrely, the investigators themselves would confirm the cheques signed by the suspects, raising questions about whether there was a line separating the people who were investigating the theft and those implicated.
Also suspicious, according to the memo, was that one of the key suspects in the fraud was later turned into a State witness. This has echoes to the post-Mutharika Cashgate prosecutions in which the prime suspect in the laundering of K1.2 billion from government coffers, Oswald Lutepo, is now a State witness.
Such threads of continuity between the Mutharika era and Joyce Banda Cashgate cases illuminate on the entrenched processes and vested interests that could scupper meaningful progress in the ongoing court cases and the fight against corruption in the public service.
In another memo to Mutharika dated October 20 2011, FIU raises several suspicious transactions involving MPS and suppliers of goods and services. In one case, a company that was registered on August 25 2011 supplied goods to MPS and received a payment of about K24 556 800 on September 2 2011, only days after registration.
“The foregoing matter raised suspicions because it appeared abnormal for a supplier that was registered on 25th August 2011 to supply goods and get payment from Malawi Police Service on 2nd September 2011. It would be doubtful that the transaction complied with required public procurement regulations.
“The nature of the transactions cited above, the parties involved and the behaviour of their bank accounts bear the hallmarks of suspicious transactions. In view of this, we submitted a report to the Inspector General of police and the Anti-Corruption Bureau [ACB] for investigations and possible prosecution,” reads the memo, titled ‘Brief report to His Excellency the State President on suspected fraudulent activities and illegal externalisation of foreign exchange.’
According to the report, an officer at AGD who was the key nexus in the syndicate was receiving salaries from AGD more than once a month as well as pension and salaries from other government ministries.
While police continued to drag their feet on the probe, Ligoya complained in his memo to Mutharika that MPS and ACB were conducting parallel investigations instead of coordinating their efforts.
While FIU has provided critical information that has aided the Cashgate investigations, the institution is hamstrung by the law which stops it from investigating and prosecuting suspects in fraud and money laundering.
This mandate falls within the ambit of MPS and ACB, among other law enforcement agencies. However, given that MPS is very much part of the fraud, there are legitimate questions over its commitment to get to the bottom of the fraud within its ranks.
Police spokesperson Rhoda Manjolo said she could only respond to our questionnaire on the issue tomorrow[Monday].
Inspector General of Police Lot Dzonzi referred Nation on Sunday back to Manjolo, saying he was at a police parade.
