CSOs demand refund of police fraud money

Civil society organisations (CSOs) have written President Peter Mutharika, his Democratic Progressive Party (DPP) and Pioneer Investments (PI) Limited demanding a refund to government money they allegedly fraudulently acquired from the Malawi Police Service (MPS) food rations deal.

The Human Rights Defenders (HRD), Centre for Human Rights and Rehabilitation (CHRR) and Centre for the Development of People (Cedep) have given Mutharika five days to refund to government K145 million that was deposited into a DPP account for which he is the sole signatory, or risk a civil lawsuit.

And Mzuzu-based Youth and Society (YAS) has written two separate letters through Ritz Attorneys-at-Law to DPP and PI Ltd, demanding that the two institutions immediately refund or indicate how they intend to repay the said sums within two days.

A leaked dossier from the Anti-Corruption Bureau (ACB) into the K2.7 billion MPS food rations scam indicates that PI Ltd made an abortive interest claim of K466 million and deposited K145 million into a DPP bank account at Standard Bank whose sole signatory is Mutharika.

The letter from HRD and company to Mutharika, through lawyer Wesley Mwafulirwa, accuses the President of knowingly withdrawing the K145 million that was fraudulently obtained in the police deal.

Reads the demand letter in part: “The opening of the bank account with only yourself as the sole signatory, the subsequent deposit of funds into the said account by Pioneer Investments and the subsequent withdrawals from the account by you has nothing to do with your duties and/or powers as President.

“We are of the informed view that the immunity that you enjoy as Head of State does not extend to this transaction as this was a private transaction not related to Your Excellency’s Powers and Duties in relation to the office that you hold.”

They have since demanded that Mutharika must repay the money within five days, failing which the CSOs will drag him and DPP to court.

In the letter to DPP, YAS argues that the governing party is aware that the said money represents proceeds of a fraudulent sham procurement by MPS officers and Karim of PI Ltd.

“You are no doubt aware that the said moneys represent proceeds of a fraudulent sham procurement by officers at Malawi Police Service in conjunction with one Zameer Karim of Pioneer Investment that resulted in the sum of K466 000 000 of consolidated revenue being misappropriated under the so-called ration packs contract between the Malawi Police Service and Pioneer Investment, according to the leaked investigation report of the Anti-Corruption Bureau….

“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,” reads the letter in part.

YAS has also asked the DPP to refund the money to government or indicate within two days how it intends to repay the said sums.

And in the letter to PI Ltd, YAS has asked the company to refund the K466 million plus compound interest at the prevailing commercial bank lending rates from the date of receipt to the date the money is repaid.

“The said sums belong to and were meant solely for the benefit of Malawians, and you are liable to repay the moneys. Please note that unless the principal sum of MWK466 million plus compound interest at the prevailing commercial bank lending rates from the date of receipt to the date you repay the moneys are repaid to a Government account forthwith and evidence of the same is provided to us on behalf of YAS; “or you indicate to us how you intend to repay the said sums within 2 [two] days hereof, we have instructions to take necessary steps to recover what rightfully and beneficially belongs to the people of Malawi,” stresses the letter.

The letter also states that the two sums represent consolidated revenue misappropriated under the fraudulent and sham procurement of the company by MPS to supply ration packs.

In an interview yesterday, DPP secretary general Grezelder Jeffrey said she was not aware of the demand letter from YAS.

She said: “I was away and I have just come in today [Wednesday], and I am hearing it from you.”

And asked about the HRD letter to Mutharika, State House press secretary Mgeme Kalilani said the letter was addressed to the wrong person.

He said: “The letter is addressed to a wrong person. The record of the bank transaction in question is clear that the cheque was deposited into a DPP account. This fact is even admitted in the lawyer’s letter of demand. Why then should the demand for refund be made against the President of the republic? If the CSOs find their demand to be meritorious, let them address it to the DPP.”

Earlier, State House explained the alleged K145 million that Karim deposited into the DPP account was among donations deposited into the party’s headquarters construction project account.

Kalilani said at the time Mutharika had no knowledge of the ACB investigations on transactions involving MPS and Pioneer Investments.

ACB director Reyneck Matemba last week told HRD representatives that the bureau could not commit to a time frame as to when investigations into the K2.7 billion MPS food rations scam would be completed and arrests effected.