Malawi: Time for action on ‘Cashgate’ corruption scandal

Malawi: Time for action on ‘Cashgate’ corruption scandal

There is a real fear in Malawi that when Parliament is dissolved on 20 March ahead of elections slated for 20 May, the senior members of the network responsible for one of the country’s biggest corruption scandals, dubbed ‘Cashgate’, will escape justice.

Many believe the election period will stall legal proceedings and could allow individuals – both senior officials and lower level civil servants involved in the scandal – to escape the reach of the law, while others may be shielded by parliamentary immunity if they or their party succeed in winning seats in parliament.

Civil society groups in Malawi are calling on the government to walk the talk in the fight against corruption, particularly since the release of the forensic audit report the ‘Cashgate’ scandal on 21 February. The report was commissioned by the Malawi government and funded by the UK government, which gave Malawi £117 million in 2012. The report focused on the facts of the case and did not identify any individual suspects. 

There should be no impunity for those involved in stealing from the state. The money should be used to help reduce poverty in Malawi and to raise living standards for all citizens.”

– Jeff Kabondo, African Institute of Corporate Citizenship

The British High Commissioner to Malawi, Michael Nevin, insisted that naming people in the report could compromise ongoing court cases, a position challenged by civil society groups and the Public Accounts Committee (PAC) of Parliament.

The scandal involves an estimated US$20 million to US$100 million that has gone missing from government coffers. It became news last year immediately after Malawi’s budget director was shot under circumstances that still remain a mystery, and huge sums of cash in both local and foreign currency were found in the vehicles and homes of some civil servants, most of them low-ranking  junior accountants.

Foreign development donors pulled the plug on US$150 million for the 2013/14 fiscal year, at least temporarily. Up to 40 per cent of Malawi’s annual budget is donor-funded.

This has angered citizens as public services, particularly health and education, have been cut. At the same time the pace of investigations remains slow. There have reportedly been 68 arrests but few cases have gone to court.

Funding challenges continue to cripple the key institutions tasked with building the case for the prosecution, including the Anti-Corruption Bureau, the Ministry of Justice and the Judiciary. President Joyce Banda reshuffled her cabinet, dismissing several ministers including the ministers of finance and justice. 

A lack of transparency

Parliament was, through the Public Accounts Committee, reportedly supposed to further debate the ‘Cashgate’ forensic report with the auditors this week. Civil society is demanding  that parliament meets to debate the full report. However, many believe it is more likely that Malawians will go to the polls with the mystery of who has been responsible for the ‘Cashgate’ still unresolved, including the role of President Banda and senior officials.

Year-in, year-out we have seen no real actions and follow-ups taken on the recommendations made by the supreme audit institutions about the different public finance management issues. We can only hope that the ‘Cashgate’ scandal will lead to some tangible actions that will help deal with this evil perhaps once and for all.”

– Dalitso Kubalasa, Malawi Economic Justice Network

A joint meeting of civil society organisations on 27 February issued a communiqué calling on the government to fully explain the disappearance of ‘Cashgate’ funds and to look into past scandals dating back to 2005. In addition, it is calling for reform of political party financing and the need for a tough law regulating political parties.

Plans are under way for civil society organisations to stage follow-up peaceful, nationwide demonstrations calling for those in power to be held fully accountable for the mismanagement of public resources.

Malawi by the numbers

  • 2012 Open Budget Index (OBI): Malawi scored 52 out of 100, indicating that almost half of key budget information is not accessible to the public
  • 2013 Corruption Perceptions Index: Malawi scored 37 out of 100 indicating a serious problem with corruption
  • 2013 National Integrity Study: Malawi lacks strong institutions and there was little enforcement of laws to combat corruption
  • Population: 15.9 million
  • Gross Domestic Product: US$4.26 billion
  • World Bank poverty headcount: 50.7 per cent of the population below the poverty line
  • Life expectancy: 54 years

For any press enquiries please contact press@transparency.org

Latest

Support Transparency International

The theme for the 18th edition of the International Anti-Corruption Conference (IACC) is announced

Building on the priorities set out in the Panama Declaration, the 18th IACC in Denmark from 22 to 24 October 2018 will move the pledge of acting together now to concrete action.

A new home for our corruption research

Transparency International is excited to announce the launch of the Knowledge Hub, a dedicated online space for our research.

Pardon me? Presidential clemency and impunity for grand corruption

Recent events in Brazil and Peru have shone a spotlight on the issue of presidential pardons in cases of grand corruption. Read more to find out the best practices that legislators can use to ensure that pardons are not abused for political purposes.

Stopping Dirty Money: the Global Effective-O-Meter

As of December 2017, global effectiveness at stopping money laundering stands at 32% effectiveness.

Corruption in the USA: The difference a year makes

A new survey by Transparency International shows that the US government has a long way to go to win back citizens’ trust.

Anti-Corruption Day 2017: Empowering citizens’ fight against corruption

The 9 December, is Anti-corruption Day. A key part of Transparency International’s work is to help people hold their governments to account. Have a look at what we've been doing around the world!

Digital Award for Transparency: Honouring digital initiatives to fight corruption

The Digital Award for Transparency awards individuals and civil society organisations who have developed digital technology tools used to fight corruption. The award aims at strengthening and promoting existing initiatives that promote good governance through three categories: Open Data, Citizen Engagement and Anti-Corruption Tools.

Social Media

Follow us on Social Media

Would you like to know more?

Sign up to stay informed about corruption news and our work around the world