Mystery surrounds operations of the government’s confiscation fund which was established by the Financial Crimes Act of 2017 to receive proceeds of forfeited property involved in crimes.
Five years down the line, the fund does not have guidelines for withdrawals, has not been audited and it is not known how much is in the account since its establishment.
Director of Public Prosecutions (DPP) Steven Kayuni said relevant authorities will disclose how much is in the fund at an appropriate time.
“The amount in the confiscation fund is not for us to announce. The authorities will do the needful at the appropriate time and very soon for that matter.
“Suffice to say that at the moment, money is going into the account and there are no withdrawals being undertaken as rules, regulations or processes are not in place yet,” Kayuni said.
On January 26, 2022, the Ministry of Justice floated an advert in the local media that it was selling 11 houses, six motor vehicles and nine sets of machines for the production of thin plastics which had a combined reserved price of over K1.1 billion.
According to the advert, the property was forfeited for various crimes investigated and prosecuted jointly by the DPP, the Financial Intelligence Authority (FIA), the Malawi Police Service and the Anti- Corruption Bureau.
Proceeds of that sale too were to go into the fund in accordance with the Act.
In an interview around June 15 on the progress of the sale, Kayuni said the government struggled to sell the property because they had dislocated in value such that they had to be retendered but he indicated that the fund was “pumping up”.
Secretary to Treasury Macdonald Mafuta Mwale referred us to the Ministry of Justice saying he too was looking for information about the fund.
“It is something to do with courts, so you should talk to the Justice people. Perhaps, you talk to the Solicitor General,” he said.
Solicitor General Allison Mbang’ombe, however, referred us to the DPP, saying he was better placed to speak on the matter.
Contrary to what legislation that established the fund says in Section 133 (2), that it has to be audited by the Auditor General, National Audit Office spokesperson Rabson Kagwaminga conceded that this has not been the case.
“Ministry of Justice and Constitutional Affairs, under which the Criminal Offences Confiscation Fund (COCF) operates is subject to audit by the Auditor General on an annual basis as required by the Public Audit Act.
“However, it is important to note that our audits are conducted on a risk basis. This entails the performance of risk assessment on all accounts and transactions to determine areas of concentration during the conduct of our work,” Kagwaminga said.
He added that based on the work done on areas assessed to be high in risks, audit conclusions for an entire ministry, department or agency can be made.
“To this end, I can confirm that the [COCF] has not featured in our audit plans since its establishment. However, planning is underway to audit the fund this financial year,” he said.
When we asked the bank where the account of the fund is held, both Kayuni and Kagwaminga referred us to FIA who are signatories of the account.
FIA spokesperson Masautso Ebere however asked for more time before commenting on the matter.
Malawi Economic Justice Network Coordinator for Southern Region, Mike Banda, said in an interview that the regulations and audits have to be done and that the amount in the fund has to be made public.
Yesterday’s edition of The Daily Times reported that government has retendered some properties confiscated from Cashgate convicts and that it also plans to sell vehicles which were used in illegally transporting forest products.