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Court nods to Reserve Bank of Malawi Forensic Report use

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The High Court sitting in Lilongwe on Monday ruled that the Reserve Bank of Malawi (RBM) should furnish parties in the K1.8 billion ATS equipment and ICT Hardware for Flexicube procurement case with contents of its Forensic Audit Report.

The ruling follows an application by Sparc Systems Managing Director Wisely Phiri, who is the first interested party in the case, who argued that the report, prepared by audit firm Deloitte, could be instrumental in the case.

Among other things, Sparc Systems argued, in its application, that the audit report which was sanctioned by the bank for its internal investigation arrived at the conclusions that Mitra Systems, which is the second interested party in the case, did not qualify to be awarded the ICT contract by RBM.

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“We believe that the Forensic Report is relevant and necessary to these court proceedings as it will show that the claimant [RBM] itself has known all along that there were serious irregularities with the procurement proceeding now under review, despite the position that it has adopted in these proceedings,” Phiri said.

But both RBM and Mitra objected to the application.

In his ruling on the application, High Court Judge Kenyatta Nyirenda said he was more than convinced that the advantages of disclosure outweigh the disadvantages of disclosure in that Sparc Systems would suffer a litigious disadvantage by not seeing or using the Forensic Audit Report and that RBM would enjoy an unfair litigious advantage by refusing to disclose contents of the Forensic Audit Report.

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“It is the claimant who instructed Deloitte to prepare the Forensic Audit Report. Furthermore, the party that is being required to make the disclosure— that is, the claimant— has not raised any issue regarding its financial capacity to disclose [contents of] the Forensic Audit Report”.

“It is, accordingly, my finding that the claimant has sufficient financial resources to do so”, Nyirenda said.

The court has since ordered RBM to produce and disclose to Sparc Systems, and other parties to the case, contents of the Forensic Audit Report within three days.

Nyirenda has also shifted the hearing of the substantive judicial review case from July 20 to July 27.

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