Muhara, others risk arrest over K5bn deal
Former secretary to the President and Cabinet Lloyd Muhara and several others risk arrests for their alleged involvement in a loan settlement deal to have Mulli Brothers Limited (MBL) Holdings pay K5 billion in 50 years.
In a letter dated May 11 2022, Attorney General Thabo Chakaka Nyirenda requested Inspector General of Police George Kainja and Director of Public Prosecutions Steve Kayuni to take action against Muhara and former secretary to the Treasury Cliff Chiunda for allegedly abusing their offices.
The communication, addressed to lawyers representing Malawi Savings Bank (MSB) Debt Collection Company and copied to Kainja, Kayuni and others, states that Muhara and Chiunda illegally instructed the law firm to withdraw enforcement of bankruptcy proceedings it obtained against MBL Holdings.
The communication indicates that the decisions were wrong as none of them was MSB Debt Collection Company directors, as such, could not validly enter into a settlement agreement on behalf of the company.
Reads the communication in part: “Both Honourable Justice Muhara and Mr. Cliff Chiunda committed a criminal offence of abuse of office contrary to Section 95 of the Penal Code or Section 25B of the Corrupt Practices Act when they executed the said settlement agreement.
“Mulli Brothers Limited, its directors or employees may also be liable for the offence of aiding and abetting abuse of office by a public officer.”
Nyirenda further requests the law firm to proceed with enforcement of the bankruptcy proceedings against MBL Holdings and to have the settlement agreement which he said was ‘illegally and unlawfully signed’ be set aside.
In an interview on Sunday, Nyirenda said he requested Kayuni and Kainja to take action against the two after discovering that they committed criminal offences.
He said: “If I come across files and see some elements of criminality, I report. So, this one will not be unique. I have reported so many cases to police and ACB [Anti-Corruption Bureau] because I don’t prosecute, I don’t investigate, but I only deal with civil matters.”
Nyirenda’s decision follows a move by his predecessor Chikosa Silungwe to review a consent order between the Malawi Government under the Democratic Progressive Party administration and MBL Holdings providing settlement of K5 billion debt over a 50-year period. Muhara and Chiunda signed on behalf of the Malawi Government while MBL Holdings was represented by its lawyers.
Under the agreement, MBL Holdings was set to be paying a fixed K5 million monthly for 50 years to settle the K5 billion owed to the public.
Kayuni on Sunday confirmed receiving the Attorney General’s request to take action against Muhara and Chiunda on the matter.
“We confirm receipt of the communication and as per constitutional mandate on institution of criminal proceedings, the directorate is giving it due considerations,” he said.
Ironically, the 2018 consent order between the Office of the President and Cabinet and MBL Holdings Limited was signed at a time the MSB Debt Collection Company formed to recover toxic loans that some businesses and politically-connected individuals owed MSB, a commercial bank then wholly-owned by Malawi Government and sold to FDH Financial Holdings Limited, struggled to make recoveries.
