Mzuzu-based Youth and Society (YAS) has again written another letter through Ritz Attorneys-at-Law to Attorney General Charles Mhango querying him why his office committed government to pay CDH Investment Bank , on behalf of a private contractor – Pioneer Investments (PI) Limited in the k2.7 billion Malawi Police Service (MPS) food rations deal.
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 Democratic Progressive Party (DPP) bank account at Standard Bank whose sole signatory is President Peter Mutharika.
While the civil society organisations (CSOs) have written President Mutharika, his DPP and PI Limited of Zameer Karim demanding a refund to government money they allegedly fraudulently acquired from the Malawi Police food rations deal, a letter seen by Nyasa Times, dated July 20 2018, YAS director, Charles Kajoloweka is also querying the government chief legal advisor on his role in the matter.
The Attorney General is being questioned why he committed to pay CDH Investment Bank which had given the contractor PI Ltd, a loan to facilitate performance of the contract.
And also Mhango’s consent order, effectively committing government to paying twice to the same contract.
In the letter, Attorney General is also quizzed why he voluntarily joined the as a third defendant when CDH investment Bank had initially only taken to court Karim of PI Ltd as first defendant and Oil and Protein Company Limited as second defendant in High Court Commercial Division Commercial Case No.276 of 2017.
According to the letter to Attorney General – Oil and Proteins Company Limited was sued as second defendants because it provided a full guarantee for the loan and CDH Investment Bank also took some collateral for the loan.
Malawi government paid K2.7 billion directly to PI Ltd against an undertaking by an officer at Malawi Police to pay the contract price to CDH investment Bank Limited.
YAS has questioned Attorney General’s office to have volunteered to be the third defendant in the case and yet an application to add the AG on behalf of police cannot be traced on the court file.
“Inexplicably, there is a consent order in which you (Attorney General) volunteered to be third defendant and went on to further execute a consent order committing government to pay part of the sums owing from Pioneer Investment to CDH IB Ltd despite the facts that; [i] Government has already paid Pioneer Investment the full contract price and Mr’ Zameer Karim admitted this much to you by letter;
“[ii]. Pioneer Investment’s loan was already fully guaranteed by the Oil and Protein Company Ltd, which was cited as second defendant and CDH IB Ltd also took some collateral as part security from the loan.”
Attorney General Mhango has been questioned on his conduct in joining the case and committing government to discharge a third party’s secured liability, with YAS wondering whether it is prudent, of due professional care, legal and in the best interest of Malawians.
“Whether you cared to ascertain and justify the legality of the underlying transaction by the Malawi Police Service and Zameer Karim t/a Pioneer Investment in terms of the procurement and public finance management legislation, and indeed other laws.
“Whether, knowing well as you already do and more so now with the contents of this letter and the leaked report, you have any intention to take steps to remedy the apparent irregularities partly highlighted above and specifically to recover any sums, including the sum of K145 million paid to a political party account , which have been paid out of consolidated revenue as a result of fraudulent breaches of trust,” reads the letter signed by lawyer Bright Theu.
The Attorney General has been given three working days to explain the queries and YAS has warned that it may hold Mhango personally liable to compensate government for any sums that may be lost through the “questionable commitment” he made and disregard of relevant facts “pointing to seemingly fraudulent scheme.
Mhango is yet to respond.
The CSOs have also demanded that Mutharika must repay the money, failing which they will drag him and DPP to court.
YAS argues that the governing party is aware that the said money represents proceeds of fraudulent sham procurement by police officers and Karim of PI Ltd. – Nyasa Times
