Tayub, one of the directors of Transglobe
Four Transglobe directors identified as Farvez Tayub, Rashid Tayub, Hamuza Tayub and Nasser Sattar and two Export Development Fund (EDF) officers identified as Thandizo Shaba and Chifuniro Kaimapanjira have been arrested for fraud and money laundering involving K6.8 billion.
National Police spokesperson Peter Kalaya has confirmed the arrest of the six saying the Transglobe directors will answer charges of fraud other than false pretences contrary to Section 319 (A) of the Penal Code and money laundering contrary to Section 331 (A) of the Penal Code.
The two EDF officials have been charged with negligence by public officers in preserving money or other property contrary to Section 284 of the Penal Code.
EDF is a Reserve Bank of Malawi subsidiary established in 2012 as a private development finance institution for export businesses.
EDF management introduced Commodity Market Making (CMM) initiative in 2017 to assist local enterprises which could not access loans from commercial backs but had capacity to secure export supply contracts.
In 2018, EDF, through CMM reached a deal with Transglobe to purchase pigeon peas and process them into Indian food called dhal. In December 2018, Transglobe and EDF entered into a joint venture agreement under CMM amounting to US$6 million (K5.4 billion).
Kalaya said the arrest of the six is related to the contract which saw EDF losing over K6.8 billion
“Between the firm and EDF, there was a contract involving production and exportation of dhal, but Transglobe was not honouring contractual obligations. They were selling the dhal to countries such as Egypt, Mauritius, India, Malaysia, Dubai and the United Kingdom,” Kalaya told the local media.
A report by private forensic accountants Fletcher and Evance which was released in March this year revealed that EDF management was running CMM without adhering to laid down procedures, resulting to the loss of K12.8 billion between 2017 and 2020.
