Former president Joyce Banda may have left office six years ago, but confidential details of her administration’s award of a patrol boats contract to Paramount Group puts a spotlight on a cozy relationship that authorities in the United States are investigating.
Banda—who became President in line with constitutional order in April 2012 following the death of Bingu wa Mutharika—is the highest profile Malawian to be named in FinCen Files.
The files are leaked banking information where global financial institutions report suspicious transfers that show people who may have benefitted from proceeds from an arms deal.
She is mentioned alongside former South Africa president Jacob Zuma as possible beneficiaries of deals involving South Africa-based arms supplier, Paramount Group.
The group was awarded the contract by the Banda administration to supply patrol boats on Lake Malawi.
The FinCen Files—a 16- month-long investigation of the International Consortium of Investigative Journalists (ICIJ), BuzzFeed News and partners, including The Nation—are based on top-secret bank reports filed to the US Treasury Department’s intelligence unit, the Financial Crime Enforcement Network, other documents and dozens of interviews.
The reports were turned over to the US Congress as part of the investigation into Russian interference in the 2016 presidential election and provide a unique, bird’s-eye view of illicit money flows that supported worldwide corruption and criminality.
The specific report that touches on Banda was written by Barclays Bank which earlier had commissioned Orbis Business Intelligence—owned by Christopher Steele, a former British spy famous for his role in investigating Russia’s meddling in the election of US President Donald Trump.
The report says Paramount and its founder Ivor Ichikowitz benefitted from their cozy ties with African leaders by being awarded major contracts. It mentions Banda and Zuma as some of the leaders.
In particular, the report cited the fallout from Malawi’s $145 million (around K108 billion) patrol boat contract, saying it was cancelled by Banda’s successor administration for three main reasons.
Stated the report: “Political rivalry [least important], expense and corruption allegations.”
The corruption allegations were strengthened in the Orbis report by the existence of several links to Bell Pottinger, internal bank records show.
Bell Pottinger was the United Kingdom public relations firm that was propping up Banda’s image abroad with funding from the Ichikowitz Family Foundation belonging to the owner of defence firm Paramount Group.
The Banda administration confirmed in 2013 that Bell Pottinger had been engaged “to assist the President and Government of Malawi to ensure that their work in fighting corruption is accurately reflected in the international media”.
The Banda administration later cut ties with the firm after the exposure of her government’s three-some links to the public relations firm and Paramount Group.
Paramount Group is said to have made 29 payments worth $585 245 to Bell Pottinger, between January 2012 and December 2013, at a time after the Malawi Government awarded the patrol boat contract to the arms supplier.
Both the ICIJ and The Nation could not independently confirm whether the payments were for services rendered to the former president.
In an e-mailed comment to The Nation and ICIJ, Banda said she did not break any law in the awarding of the contract to Paramount Group, emphasising that she was not personally involved in the procurement of the boats.
She said she was informed that Bell Pottinger “certainly did not play any role in the awarding of the boat contract”; hence, “any such suggestion is malicious and false”.
Banda added that she could not comment on the relationship between Bell Pottinger and Paramount.
She said: “Allow me to make it very clear once again. Presidents do not award contracts in Malawi. The patrol boat contract was not awarded by me as a sitting President at the time and I again refer you to what I have quoted above as to the official statement of the Government of Malawi following on the advice of its Attorney General.
“Please ensure that your publication does not make any malicious allegations against me, the Government of Malawi and our officials.
“My findings are that these same narratives appear to be revisited by people and so I encourage you to go and look at the explanations of what happened according to those persons involved during the events which have been fully ventilated on numerous platforms.”
Banda said the contract between Malawi Government and Paramount was concluded according to Malawian Government processes and was signed by both the Ministry of Finance and the Ministry of Defence.
She said: “At the time of signing, a legal opinion was secured from the [Malawi] Attorney General confirming both the legality of the agreement and its validity under Malawian law.”
Following a change of administration through the May 19 2014 Tripartite Elections, Minister of Finance in the Peter Mutharika-led government, Goodall Gondwe, threatened to cancel the contract.
In a separate interview, Gondwe said he still stood by his concerns that the contract was unnecessary and expensive for the country.
He said: “It’s a long time ago… Negotiations happened, but we only renegotiated the period of payment and not the sum of the contract. We paid the whole amount. They delivered everything.
“Yes, I was not happy with the contract. I don’t think we needed it. The president [Peter Mutharika] was not happy [with the contract]. The Attorney General, however, advised us to proceed with the contract.”
Ichikowitz, chairperson of Paramount Group, did not speak to ICIJ or The Nation, but in a written response to questions submitted by the ICIJ, his lawyers refused to respond to the questions unless the ICIJ or its partners explained how confidential details were sourced.
Besides Banda, scores of world leaders, businesspersons, celebrities, sports stars have been named in FinCen Files which are being published across the world in the largest cross-border collaboration.