Diplomat arrested over embassy fraud

Fiscal Police on Tuesday started pouncing on suspects in the alleged plunder of public funds at the Malawi Embassy in Addis Ababa, Ethiopia with the arrest of suspended Deputy Ambassador Doreen Kapanga.

The development follows an audit at the mission in Addis Ababa, which also caters for the African Union (AU), which revealed that about $406 206.15 (about K293 million) was misappropriated from public coffers and allegedly deposited into personal accounts of some staff.

National Police deputy spokesperson Thomeck Nyaude last evening confirmed the arrest of Kapanga, but could not divulge further information.

He said: “We have indeed arrested the deputy ambassador [to Ethiopia] to enable us investigate the information we have that she was involved in the embezzling of public funds at the Malawi Embassy in Ethiopia.”

Nyaude said Kapanga, who served as Malawi Police Service Deputy Inspector General (Administration) in 2012 before her diplomatic appointment in 2013, was picked up yesterday afternoon.

Police sources told The Nation last evening that Kapanga was being held at Lilongwe (Area 3) Police Station where she was taken to around 2:20pm.

Upon reaching the station, our sources said, the suspect was kept in the interview room for sometime after she developed high blood pressure (HBP) condition.

According to the source, Kapanga has been charged with an offence of theft and money laundering contrary to Sections 278 and 35 (1)(c) of the Penal Code.

The alleged plunder of public funds at the Addis Ababa mission was detected in April this year after the first secretary for administration and finance at the mission, Fletcher Chowe, reportedly wrote a cheque in his name.

Initially, a preliminary audit report revealed that about K20 million (about $29 054.8) had been looted at the embassy.

This was after Malawi’s Ambassador to Ethiopia and AU Chimango Chirwa reported about an attempted fraud by members of his staff at the mission, a development that moved government to institute an investigative audit.

The audit sought to establish if indeed fraud had taken place, assess the extent and the suspects.

The Addis Ababa financial scam resulted in government suspending and recalling from the mission Kapanga and Chowe.

Minister of Foreign Affairs and International Cooperation Francis Kasaila is on record as having said that auditors sent to conduct the exercise uncovered well crafted “massive fraudulent-activities” at the mission.

The minister said the systematic and merciless clandestine operation to plunder public resources started in 2013.

Ironically, the shooting of former Ministry of Finance budget director Paul Mphwiyo outside the gate of his Area 43 residence in Lilongwe on the night of September 13 2013 led to revelations of the plunder of public resources at Capital Hill later called Cashgate.

Former president Joyce Banda ordered a forensic audit undertaken by British firm Baker Tilly, covering the period between April and September 2013. The exercise established that about K24 billion was siphoned from public coffers through dubious payments, inflated invoices and goods or services that were never rendered.

Last May, a financial analysis report by audit and business advisory firm PricewaterhouseCoopers (PwC) also established that about K577 billion in public funds could not be reconciliated between 2009 and December 31 2014