Reserve Bank of Malawi (RBM) has asked Ministry of Finance, Economic Planning and Decentralisation to facilitate urgent nomination and appointment of new trustees for the Public Service Pension Trust Fund.
The call comes after RBM Governor George Partridge, in his capacity as Registrar of Financial Institutions, on Thursday revoked licences of 11 trustees of the fund in accordance with Section 36(1)(d) of the Pension Act (2023).
Responding to The Nation questionnaire on who is managing the affairs of the fund in the absence of trustees, RBM spokesperson Boston Maliketi Banda said the day to day operational functions are currently managed by the fund’s secretariat to ensure continuity of services.
He said: “At the governance level, the Ministry of Finance, acting as the representative of the employer [government] in accordance with the Pension Fund’s Trust Deed, has been requested to urgently facilitate the nomination and appointment of new trustees.
“These will represent both the employer and the employees to restore full governance oversight.”
Partridge. | Nation
Maliketi Banda also confirmed that fines imposed on the former trustees have not yet been paid, indicating that the registrar may pursue recovery through prescribed legal channels.
He said: “In the meantime, the affected trustees have lodged an appeal with the Financial Services Appeals Tribunal, challenging the imposition of the fines. The matter is, therefore, following due legal process.
“The regulator’s actions are aimed at safeguarding members’ interests, strengthening governance and ensuring that the pension fund operates in full compliance with applicable laws and regulations.”
Besides chairperson Chizaso Nyirongo, other trustees chopped are Chikondi Veronica Phiri, Idris Mdala Mwale, Maxwell Spencer Tsitsi, Ireen Chikapa, Arthur Manyunya, Precious Chimbamba, Yona Phiri, Richard Zimba, Brazio Mphepo and Bernard Nyondo.
In an earlier interview, Nyirongo said he had seen the press release from the registrar, but was yet to receive any formal communication.
He said: “Maybe the others have [received]. I still stand by my earlier position regarding the conduct of the registrar as evidenced by this.
“No fines were paid as the appellate process is very alive and still underway. I am sure that the purported revocation is and shall not be the last word on this matter.”
Earlier, private practice lawyer Benedicto Kondowe said the registrar has formally withdrawn the legal authority of the named trustees and in effect, they are disqualified from exercising fiduciary powers over the fund.
He said while the decision creates a governance vacuum that must be urgently stabilised, it also serves as a protective function, ring-fencing members’ assets from decisions made by a board found to be non-compliant.
Section 135 of the Pensions Act (2023) gives the registrar powers to impose administrative sanctions, including monetary penalties.
Subsection 3 of the section states: “A person on whom an administrative penalty has been imposed and who fails or refuses to comply commits an offence and shall, upon conviction, be liable to a fine of K100 000 000 and imprisonment for ten years.”
A leaked report from an initial inquiry into the purchase of Amaryllis Hotel in Blantyre by the fund recommended suspensions, further investigations and legal action against several high profile persons allegedly involved in the K128.75 billion deal.
