6 arrested over K6.8bn deal
Fiscal Police have arrested four co-directors of Transglobe Produce Export Limited and two officers from Reserve Bank of Malawi (RBM) subsidiary Export Development Fund (EDF) for alleged fraud and money laundering of K6.8 billion.
National Police spokesperson Peter Kalaya in an interview yesterday identified the four officials of the privately-owned Transglobe as Farvez Tayub, Rashid Tayub, Hamuza Tayub and Nasser Abdul Sattar. He said the EDF officers are Chifuniro Kaimanjira and Thandizo Shaba.
He said: “Between the firm and EDF, there was a contract involving production and exportation of dhal, but Transglobe was not honouring contractual obligations. They were selling the dhal to countries such as Egypt, Mauritius, India, Malaysia, Dubai and the United Kingdom.
“The four co-directors will answer charges of fraud other than false pretences contrary to Section 319 (A) of the Penal Code and money laundering contrary to Section 331 (A) of the Penal Code.”
Kalaya said the two EDF officials have been charged with negligence by public officers in preserving money or other property contrary to Section 284 of the Penal Code.
The arrest comes weeks after High Court of Malawi Judge Kenyatta Nyirenda of Lilongwe District Registry dismissed with costs an application by Transglobe co-directors to stop police from undertaking criminal investigations against them.
The quartet wanted the court to put aside enforcement of the decision by the Director of Public Prosecutions (DPP) and Malawi Police Service to probe them for their firm’s alleged involvement in the abuse of K12.8 billion at EDF.
In the judicial review case, Transglobe co-directors claimed that there was no impropriety in the way Transglobe Produce Export Limited performed its duties and carried on its business as per the agreements it had with EDF.
According to a report from Fletcher and Evans in March this year, the K12.8 billion loss resulted from financial deals EDF had with private firms and other selected investment transactions of the fund between 2017 and 2020.
It alleges that the conduct of EDF management in operating the Commodity Market Making (CMM) initiative without following processes and procedures and credit risk assessment “clearly indicated acts of gross negligence and abuse of office”.
CMM is EDF’s initiative which its management introduced to assist local enterprises with the potential to secure export supply contracts.
EDF is also among 11 State agencies struggling to get K11 billion worth of their investments with Alliance Capital Limited.
EDF was established in 2012 to help increase productive potential of the country through provision of finance, equity participation, or credit guarantees, and advisory service for the setting up, expansion and modernisation of viable enterprises in the medium and large scale enterprises sector.
