For the first time since revelations of the plunder of public resources at Capital Hill widely known as Cashgate, convict Leonard Kalonga yesterday mentioned People’s Party (PP) as a beneficiary of 60 percent of the proceeds.
Testifying as a State witness in the K2.4 billion Cashgate case involving former Ministry of Finance budget director Paul Mphwiyo and 17 others, Kalonga—a former tourism officer in the then Ministry of Tourism and Culture—told the High Court sitting at the Lilongwe City Council Civic Centre due to lack of space at the court premises, that participating agencies shared the remaining 40 percent of the loot.
However, Kalonga said the other players were not sure or privy to how Mphwiyo delivered the said cash to the PP.
He said: “Mphwiyo used to tell us that he was remitting 60 percent of the proceeds to PP. How he was doing that, nobody would know and on our part we were not interested. However, some had distrust that Mphwiyo was not remitting all the 60 percent to the party as he claimed.”
The revelations of 60 percent cut to PP and 40 percent to participating agencies and individuals come against the background that some contractors and other firms were getting an average 10 percent share of the loot for allowing their bank accounts to be used as a conduit for the proceeds.
Over the years, Malawi has also been losing about a third of its approved national budget to fraud.
In his testimony, Kalonga mentioned the Office of Director of Buildings in the Ministry of Transport and Public Infrastructure, the Accountant General Department (AGD), the Office of the Director of Public Procurement (ODPP), Treasury and the Financial Intelligence Unit (FIU) as some of the participating agencies.
He further told the court that some of the people involved in the scheme expressed reservations on how the proceeds were being shared.
Kalonga, who was convicted on his own plea of guilty in August 2015 and is awaiting sentencing, told the court that while officials from the Ministry of Tourism and Culture involved in the scheme had no problem with what Mphwiyo gave them as their share, other players felt Mphwiyo lacked honesty in the whole arrangement.
He said some individuals suspected that Mphwiyo may not have been remitting all the money he collected in the name of PP.
Explained Kalonga: “Our share as Tourism officials was K2.5 million; and, we shared this amount equally among the four of us. A few days later, I received a call from a Mr Siti—who was representing AGD in the scheme—who said he wasn’t happy with the way the transaction was done. He said he was not happy with what they got as their share.”
First to complain was his (Kalonga’s) workmate George Banda, who was Ministry of Tourism and Culture chief accountant, he said.
He said a Mr Chipendo, Mphwiyo’s workmate at Treasury, also called him (Kalonga) and complained about his share of the proceeds.
According to Kalonga, the growing mistrust made some of the people to expressly inform him (Kalonga) that they would not be comfortable to be involved in future schemes if no corrective measures were done.
He said he arranged a meeting with Mphwiyo who dismissed the complaints and fears. He said he met Mphwiyo alongside Banda.
Said Kalonga: “He [Mphwiyo] said he could do without those complaining.”
In June 2013, Kalonga told the court, Mphwiyo asked Ministry of Tourism officials and others to prepare for the second round of funding. At this point, the former budget director invited the duo—Kalonga and Banda—to meet him at Four Seasons complex along the Presidential Drive leading to Kamuzu Palace.
During the Four Seasons meeting, Kalonga said, Mphwiyo was accompanied by Maxwell Namata who was attending the meeting for the first time.
He said Mphwiyo informed him (Kalonga) and Banda that he had been promoted to the position of budget director owing to his cooperation in raising funds for the PP.
Kalonga said this development allayed the distrust they had about their prospects of being rewarded by “people who matter in government” which Mphwiyo earlier mentioned as the President and some top public servants.
However, as Kalonga and Banda waited for their turn to be promoted, the scam was exposed through the shooting on September 13 2013 of Mphwiyo outside the gate of his Area 43 residence in Lilongwe.
In the case, Mphwiyo and 17 others are charged with conspiracy to defraud government, holding property belonging to government, theft, money laundering, fraudulently issuing 24 cheques worth K2.4 billion, abuse of public office and usage of proceeds of crime. n