Monday, February 26, 2024
Investigations

Criminal liability for Salima Sugar Directors and Accomplices; conspired with DPP regime officials to loot over K1.6 billion

 

An audit report has exploded worms out of a sealed can, detailing massive-scale abuses at partly state-owned company, Salima Suga.

The Democratic Progressive Party (DPP) reached a point where they believed they were unbeatable and therefore could do anything with calculated impunity. To say that the DPP politicians ran the country as their farm estate could not even come close to the required clarity of the picture depicting how arrogant, irresponsible and careless their ego descended into, for even in running one’s farm estate, a measure of care and good calculation is put into regard to sustain it.

Numerous government parastatals were turned into DPP cash cows. In departments such as EGENCO, cronies like Liabunya were strategically planted with the sole assignment to syphon government money into the coffers of the DPP and its politburo. No wonder the revelations that have recently exploded there. But today’s revealed pillage is not about EGENCO, but Salima Sugar, where such operations could least be suspected of taking place owing to the presence of private sector which partnered with the Government under the Public Private Partnership arrangement.

Salima Sugar Coompany Limited (simply Salima Sugar) is a public limited company registered under Companies Act, Malawi. The Government of Malawi owns 40% of its total shares while the 60% shares are held by Aum Sugar Company Limited, an international company from India. Aum Sugar, who are cited as promoters of the company, are responsible for the day-to-day running of the company including all operations and resource management.

The company (Salima Sugar) was recently undergoing a compulsory audit and damning relations have been published, suggesting some criminal adventures. The audit was initiated by the incumbent administration when a stench rotten worms evaporated from the can. The company wanted to obtain another sovereign guarantee for a loan, and the then Finance Minister, Sosten Gwengwe, expressed reservations. Gwengwe proceeded to ask the Attorney General for a legal opinion and flushed out some of the questionable issues. The Attorney General, Thabo Chakaka Nyirenda called for an audit to provide forensic findings.

Audit Consult were called upon to duty and have since produced a report, although not yet available for public access, that reveals corroborated nefarious theft of the company’s money. Senior government officials and ruling party officials under the Peter Mutharika administration, including top civil servants, received dubious payments amounting to over K1.6 billion in a cobweb of looting and financial mismanagement at the company.

The auditors have reportedly discovered minutes of a board meeting in which Salima Sugar Chairperson, Shiriesh Betgiri, and Dr. Sahin agreed to make payments in US foreign currency, suspected to be from an inaccessible foreign bank account. The total amount agreed upon was $875,000 in US dollars (equivalent to approximately 1 billion Malawi Kwacha) and K60 million in Malawi Kwacha.

The highest individual payment, $325,000 (equivalent to K376 million), was allegedly made to an official identified as HM, with the payment scheduled for April 2020. Another official, identified only as ST, was designated to receive K60 million in local currency. It’s worth noting that “ST” often refers to the Secretary to the Treasury, and at that time, Ben Botolo held that position.

The audit report states, “Chairman Betgiri and Director Dr. Sachin B Nikam engaged in corrupt practices by defrauding Malawians of over US$875,000 and K60 million, respectively. The two directors allegedly collaborated with public officials and individuals mentioned in the report to commit fraud.” While some officials were allegedly paid allowances, some received one-off payments in US dollars whose purpose could not be identified.

Even more intriguingly, the names of the officials were not listed in the accounts records when the payments were made, with the company only recording initials suspected to be job titles of the officials paid. Some of the unrecorded petty cash vouchers did not specify the names of the person withdrawing the cash. The report further raises other governance irregularities at the company, including alleged acts of negligence and abuse of office, as evidenced by the company’s further payments to fictitious directors and the provision of unexplained benefits to senior employees.

Fiscal Police arrested Betigri in July in connection with alleged tax evasion and money laundering at the company, and there are expectations that the current audit report will lead to more arrests. Three former cabinet ministers, two senior government officials and a former chief executive officer for a state-owned company have been named as actors and beneficiaries of the Salima Sugar fraud.

According to the report, which is yet to be released, from September 2018 to April 2023, some officials from the Green Built Initiatives (GBI), Justice Lloyd Muhara, Grey Nyandule Phiri and Ben Botolo attended meetings as directors from the said date until April 2023 without any official appointment as directors.

 

 

Editor In-Chief
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