The Electricity Generation Company (Egenco) of Malawi is at the centre of a significant procurement scandal involving K6.7 billion (£6.9 million) with unauthorised requisitions and extensive single sourcing from companies owned by individuals of dubious integrity, among them Abdul Karim Batatawala, despite facing fraud and corruption charges.
A detailed forensic investigation conducted by Mwenelupembe, Mhango & Company has uncovered these discrepancies.
Egenco’s board chairperson, Colleen Zamba, who also serves as Secretary to the President and Cabinet (SPC), has confirmed the report’s authenticity to a local publication, NPL.
Batatawala’s companies implicated in the scandal include L & G Tools and Engineering and Novatech Engineering Supplies. The forensic investigation established that L & G Tools and Engineering was registered on 20 December 2000 by Sabina Karim Batatawala and later taken over by Abdul Karim Batatawala on 8 May 2003. Mohamed Shakil Abdul Sattar Sali joined the company as a partner on 10 October 2008. Meanwhile, Batatawala registered Novatech Engineering Supplies on 21 October 1998.
The forensic report reveals, “There was no initial competition from which Abdul Karim Batatawala’s companies emerged as successful bidders.” The auditors note that Batatawala’s companies received contracts through the single-source method which they say is in breach of the Corrupt Practices Act in Malawi.
“The process and circumstances under which the single-source method was used were themselves flawed, and in breach of the Competition and Fair Trading Act, the Public Procurement and Disposal of Assets Act, and the Corrupt Practices Act,” reads the report on page 26.
The forensic investigators particularly note that continued engagement with Batatawala through his firms occurred during the period the tycoon was already facing corruption and fraud charges.
“It should be noted that the name Abdul Karim Batatawala has been in the public domain during the period we are investigating, for example in relation to the uniform saga at the Immigration Department involving billions of Malawi Kwacha. This incident alone should have put procurement officials at Egenco on high alert in their dealings with him or his companies.”
“At the time we were finalising this report, we had not yet received information from the Registrar General’s office regarding Universal Kit and Lido Electrical, which are alleged to belong to Abdul Karim Batatawala and were awarded contracts as mentioned above on pages 20 and 24 respectively,” the report continues.
Meanwhile, Zamba mentioned that the board is currently reviewing the report to determine the course of action to be undertaken.
