A payment of about US$76,5000 sent by Reserve Bank of Malawi (RBM) to the Malawi Mission in Brazil has raised concerns about money laundering and forex externalization.
On 4 June this year, the Ministry of Foreign Affairs notified the Malawi Ambassador in Brazil that Reserve Bank of Malawi had externalized funds to the mission.
The amount sent was 76,516 (about K61.5 million) but part of the money was to be used as Foreign Service Allowance (FSA) arrears for a former diplomat.
“Note: USD39,439.73 FSA arrears for Ben M’bwana Phiri from November 2013 to December, 2016,” reads part of the memo signed by Deputy Director of Finance Dennis Siti and Deputy Director of Human Resources Grace Chatha Gama.
The two did not say what the rest of the money will be used for, something which has raised concerns
Speaking to the local media, a governance also questioned why government was paying the money in US dollars to the former diplomat who is currently in Malawi, considering that Malawi is currently facing a shortage of forex.
“Something may not be adding up and the ministry needs to explain this,” said the expert.
But another expert argued that paying the money in Kwacha would raise audit issues in future hence it was safe for the ministry to use the same channels it would have used if the former diplomat was still in Brazil.
Ministry of Foreign Affairs and International Cooperation spokesperson Rejoice Shumba has since described the transaction as normal.