The High Court in Blantyre has ordered Standard Bank Plc to freeze an account for the ruling Democratic Progressive Party (DPP) through which the party allegedly received K145 million from Pioneer Investments Limited in the Malawi Police Service food rations deal.
The court, according to documents we have seen, based on an application made by Mzuzu-based Youth and Society (YAS) through Ritz Attorneys-at-Law, has since set aside an inter-parties hearing of the freezing to August 3 2018.
YAS executive director Charles Kajoloweka on Friday confirmed that they have taken Pioneer Investments and the DPP to court, but could neither confirm nor deny the court order. YAS lawyer Bright Theu promised to shed more light on the case today.
On his part, DPP spokesperson Nicholas Dausi, while stating that the party was not aware of the case, wondered why “other people would want to take duties and responsibilities of other constitutionally instituted bodies to act on their behalf”.
The order follows a court case in which YAS, through Ritz Attorneys-at-Law, sued DPP and Pioneer Investments on July 24 2018, asking the court to freeze the accounts for the two institutions, among others.
In the Civil Case No.215 of 2018, DPP’s secretary general Greselder Jeffrey and legal affairs director Charles Mhango are first defendants on their own behalf and that of members of the DPP, Zameer Karim of Pioneer Investments is second defendant while Innocent Bottoman of Police is the third defendant.
On the other hand, Standard Bank Plc, National Bank of Malawi Plc, director of the Anti-Corruption Bureau (ACB) and former Secretary to Treasury (ST) Ronald Mangani are first, second, third and fourth parties cited, respectively.
The case follows a leaked dossier from the ACB which documented that Pioneer Investments made an abortive interest claim of K466 million and deposited K145 million into the DPP bank account No. 0140031992200 at Standard Bank, whose sole signatory is President Peter Mutharika.
Reads the court order: “Until further Order of the Court, the First Defendants by themselves or their officers or agents or anyone acting on their behalf must not remove, or in any way dispose of, deal with or diminish the funds standing to their credit in account number 014003192200 held with the first party cited to the extent of K145 000 000.00.
“Until further Order of the Court, the first party cited should not transact any disposal, transfer, dissipation, or howsoever termed the first defendants’ funds cited in the above cited account.”
It adds: “All parties concerned should appear before the Judge in chamber on 3rd of August 2018 at 2 O’clock in the afternoon for an inter-partes hearing on: (i) The freezing (ii) The application for disclosures are against the parties cited.
YAS took the DPP and Pioneer Investments to court after the two failed to pay back the money, having demanded such through demand letters on July 17 2018.
The demand letter from YAS to the DPP argued that the ruling party is in no doubt aware that the said money represents proceeds of a fraudulent procurement by officers at Police in conjunction with Karim of Pioneer Investments.
“Our client remains baffled that even after you, your party members and especially your party president/chairman learnt of the fraud that yielded the sum of K466 million, of which K145 million is considered a part of, you have not in good conscience refunded let alone committed to refund the moneys to government for the use and benefit of the people of Malawi,” read the letter in part.
In the letter to Pioneer Investments, YAS asked the company to refund the principal sum of K466 million plus compound interest at the prevailing commercial bank lending rates from the date of receipt to the date of repay the money.
“A repayment of the money paid or due to be paid by the Attorney General in respect of the judgment in Commercial Case No. 276 of 2017 which arose as a result of the illegal undertaking/guarantee made to CDH IB with your active participation for you to obtain a loan to facilitate performance of the ration packs’ contract which had not yet been awarded to you at the time of the undertaking;
“…and your breach of agreement with CDH IB in which you diverted funds that ought to be paid to your loan account with the said CDH IB, according to the leaked report of investigations by the Anti-Corruption Bureau,” adds the demand letter to Pioneer Investments.