Firm sued over RBM forensic audit

Mulli Brothers Limited (MBL) has sued consulting firm Deloitte for defamation in a forensic audit report claim that MBL benefited from dubious payments from Reserve Bank of Malawi (RBM), court records show.

RBM sanctioned the audit into local and foreign payments after the Tonse Alliance government replaced the Democratic Progressive Party (DPP) last year.

Released in May, the audit report January 1 2019 and June 30 2020 details how central bank officials allegedly bended own rules to facilitate payments, including some which auditors deemed fabricated.

MBL, according to summons filed by Ritz Attorneys at Law, has picked up the claim from page three of the report which signalled that MBL was overpaid through the Fertiliser Inputs Subsidy Programme.

The summons read: “The defendant [Deloitte] … stated that the Mulli Brothers and Jean Mathanga (the wife to RBM deputy governor) were benefitting from hefty loans from RBM for their businesses.

“The Mullis and the Mathangas were paid money four times for the Fertiliser Subsidy Programme and payments were made before the contracts were awarded to other suppliers…”

MLB, argues in the court summons filed at the High Court on August 24 that “this statement by the defendant was written negligently and with malice as the said RBM did not at any time dubiously finance the claimant.”

In the second claim, MBL argues that the auditors did not hear its side before publishing the report, seeks damages and that the court rule that the audit report was not credible.

Deloitte could not immediately comment on the court case but the summons has stamps as proof that they received the documents.

The audit report led to the arrest of former RBM deputy governor Henry Mathanga, director of financial markets operations Roderick Wiyo and senior finance and market operations dealer Leah Donga.

The State charged them with four counts of negligence, abuse of office, money laundering and causing loss of public funds.

However, the Institute of Chartered Accountants in Malawi which investigates audit queries has said it has not received any official complaint from Deloitte.

In an interview, Icam chief executive officer Francis Gondwe said he would prefer that aggrieved parties lodge their complaints with the institution before seeking court intervention.