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Malawi Central Bank Suffers Fraud

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Reserve Bank of Malawi (RBM) head of internal Audit Department Clement Chimkono has been sent of forced leave to pave way for a forensic audit including a probe on K340million feared to have been stolen by one of the central bank Managers.

“I can confirm I was asked to proceed on Leave,” Chimkono said on Friday.

Sources at the central bank say embezzlement and fraud have hit the central bank in recent years, pointing to worsening of the vice.

The central Bank’s Fiscal Operations Manager Charles Mchakulu has been under investigation over the missing K340million- this fraud was discovered through a system of surveillance of transactions in the banking system.

Mchakulu has allegedly been making non supported transactions from the ORT (Other Recurrent Transactions) to a stationery supplier.

This has prompted the central Bank to review several operational and adimnistrative policies as the office of the President and Cabinet (OPC) and the financial institution are tussling with former RBM Governor Dalitso Kabambe over K1billion claim as terminal benefits and breach of contract following his removal by President Lazarus Chakwera in July 2020.

Kabambe who was appointed to head the central Bank by former President Peter Mutharika in April 2017, filed a K1billion claim as terminal benefits and breach of contract.

He had nine months and 16days remaining on his RBM contract at the time he was replaced with Wilson Banda.

Attorney General Chikosa Silungwe, whose office provided a legal opinion on the matter to the OPC, said government will reject the claim and if it goes to court, “the law suit will be defended.”

Malawi government argues that Kabambe was appointed RBM Governor on secondment from mainstream civil service where he worked at OPC; hence, he is not entitled to the payout.

The government contends that Kabambe will have to resume his civil service career following endorcement from RBM.

However, Kabambe was last week included into frontline politics as a member of the former governing Democratic Progressive Party (DPP) said that he would not go back to the OPC, hinting the move was political.

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