Billions of kwacha have been lost as numerous government institutions, limited liability companies have invested in the financial services provider, Alliance Capital Limited, which has been ordered by the Commercial Division of the High Court to be liquidated as requested by the Reserve Bank of Malawi (RBM) as the Registrar of Financial Institutions.
Some notable private companies and individuals include Nico Asset Managers (K3 billion); Zamara Pension Fund (K2 billion); Open Connect (K2 billion); Britam (K500 million); Reunion (500 million K); Jimmy Korea Mpatsa (K2 billion) and several others.
Delivering his decision on Friday in Blantyre, Judge Masauko Msungama was of the view that the Registrar of Financial Institutions has proven to the required standard of proof that the company is insolvent and unlikely to return to solvency in a reasonable time”.
“I therefore order that there be liquidation,” Msungama said and then appointed RBM, as Registrar of Financial Institutions, to be the liquidator of Alliance Capital Limited with immediate effect.
Judge Msungama rendered his decision in accordance with the provisions of the Financial Services Act and added that since RBM ordered the shareholders, directors and senior management of Alliance Capital Limited to move the assets of the company and their personal assets outside the jurisdiction or to dispose of or transfer such assets without the prior notice and approval of the Registrar.
“I hope the Registrar ensures compliance with this restriction by relevant parties with respect to the way the company has conducted its affairs and the way it has handled the finances belonging to its customers.
“I have deliberately avoided discussing the roles of other significant players in this matter (such as the company’s external auditors and the regulator itself) in order to avoid drawing conclusions (about whether s performed their duties diligently) without giving them an opportunity to be heard and also to avoid pre-empting the options of the Company’s customers regarding their efforts to collect their dues from the Company.
Writing on his Facebook page, Joseph Kamkwasi was in disbelief that as a regulator, RBM had never seen the red flags of corporate mismanagement and feared that taxpayers’ money was being used to reimburse all customers. affected by this liquidation. .
He suggested that RBM “should not regulate other banks and financial institutions” and suggested that the industry should have “an independent regulator” to also “regulate the Reserve Bank”.
He described the fiasco as a big larceny, while saying the public shouldn’t be surprised at the scarcity of fuel and forex, electricity challenges – saying the nominations in these industry players are ” strategies and cronyism”.
He described this as a very sad development, saying that the loss of life savings in this way is very depressing as the whole life savings of the elderly have been lost, saying that he knows a widow who came to his office “crying the whole time she was there”.
Idriss Ali Nassah, a veteran journalist and social issues commentator, agrees, saying it really is “great larceny and nothing less”, with Davie Tambala saying: “This country is rotten until marrow”.
Vinnie Shabani: ‘It’s always people who portray others as lacking integrity and themselves decent who rob Malawians’, while Inno Morgan Pondani questions whether investment companies have cash reserves with the Central Bank and “if they have it, is it enough to reimburse the entities owed? »
To which Duncan Msonthi said pension funds are also regulated by the Central Cank but “only to be robbed by a fund manager – also regulated by the same central bank”.
Stain Mabangwe wondered “why is it so easy for Malawians to break the law. It’s as if we don’t have a government with laws. Where is our ability to enforce the law?
Austin Kamanga was of the view that RBM “itself is loaded with internal fraud” and yet it is mandated to regulate another bank – “that’s no surprise”.
Last month, RBM awarded all of its information and communications technology (ICT) tenders worth more than K4 billion to foreign companies at the expense of competent ICT service providers belonging to Malawians.
RBM has announced its intentions in the print media to award tenders for the Swift infrastructure upgrade to be shared between Technet and Mitra for a total value of nearly K750 million.
Reliable industry sources reveal that Technet is a Zambian company while Mitra is owned by a Rwandan Robert Benimana and a Zimbabwean, Martin Masawi – who recently came into the limelight when RBM awarded them a dubious tender despite the revelation that they were not qualified.
RBM’s other intention to award a tender is for the upgrade of the Central Bank’s local area network (LAN), which was awarded to Globe Internet Limited for nearly K1.5 billion.
The tender for the Automated Transfer System, e-Business Suite and Flexicube upgrade has again been awarded to Mitra Systems for US$1.7 million, more than MK1.7 billion .
Thus giving all the ICT services the Central Bank needs to upgrade to non-indigenous black Malawians at a total cost of K4 billion.
This goes against what President Lazarus Chakwera is campaigning for, which is that 60% of government commercial contracts should be awarded to competent Malawian companies and a source within the ICT industry opines that “the president’s directives are just talk shows”.
“Limited companies are offering business to Malawian-owned businesses to support President Chakwera’s campaign, but it seems government agencies are unwilling to support the president,” our source said.
“We have competent Malawian-owned ICT service providers who need support to grow and for government and the rest of the commercial industry to receive the best services.”
Just recently, there was a public outcry on social media when the Malawi Revenue Authority (MRA) published its intention in the print media to award Microsoft Windows licenses to Dimension Data of Botswana for US$1 million. .
Our survey – based on comments on social media – providing Microsoft licenses is a basic ICT skills requirement and, according to one industry expert, “even someone who has just finished college can do and yet MRA wanted to award a US$1 million contract to a company from Botswana in the context of the number of capable ICT companies in Malawi”.
Recently, the Malawi Communication Regulatory Authority (MACRA) suspended the awarding of tenders worth K14 billion to non-Malawian companies by Public Private Partnership Company (PPPC) because the companies were not fulfilling the conditions of having at least 20% local shareholding.
PPPC decided to drop both this 20% requirement and the president’s directive to give 60% of business to locals.
Chakwera has made it mandatory that there are deliberate policies to protect local corporate actors after observing that local actors are at the mercy of foreign companies.
RBM’s decision also comes amid a legal tussle between Attorney General Thabo Chakaka Nyirenda and Fischer Consulting – a South African company that won the tender for the Malawi Traffic Information System (MalTIS) – a system computing that even a Malawian company could have provided.
In conjunction with Motor Vehicle Spares and Accessories (Movesa), Fischer Consulting fails to hand over the system, five years after the original agreed handover time.
Last month, the AG was in disbelief that an ICT contract had been given to Movesa, a company without ICT expertise, which subcontracted the deal to Fischer Consulting.
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