17 December 2018

Malawi: ACB Probes K200m Bribe Claim in Interest Cap Bill - Summons MP Dzonzi After Malawi News Report

The Anti-Corruption Bureau (ACB) has confirmed it is interested to investigate claims by Member of Parliament (MP) for Dowa West Alexander Kusamba Dzonzi (Malawi Congress Party) that he was offered K200 million bribe to abandon tabling of the Financial Services (Amendment) Bill in Parliament.

Dzonzi claimed in report which was published by Malawi News on Saturday that he was offered the bribe by a local commercial bank to drop the Bill, alsoknown as Interest Capping Bill.

The Bill, which proposes among other issues seek to put limits on how much interest rates banks, microfinance institutions, Saccos and other lenders can put on loans, has generated interest in the country.

ACB deputy Reyneck Matemba said the graft-busting body will summon Dzonzi and question him on the matter because the issue has "attracted public interest."

Said Matemba: "We have taken note of the allegation."

He said the bureau will follow all to logical conclusions within the parameters of the law when conducting the investigations and "get tot he bottom of this issue."

Meanwhile, government says it does not support the Bill because it is not consistent with the Constitution of the Republic of Malawi and other existing laws.

Minister of Information and Communications Technology Henry Mussa said the government could not have allowed a Bill that has loopholes.

Mussa in the statement argues that matters of monetary policy are provided for under Section 185 of the Republic Constitution and theReserve Bank of Malawi Act under which RBM under the leadership of the Governor are given powers to set and implement monetary policy in this country.

"The Registrar of Financial Institutions has no powers over these matters as is being suggested in this Bill. Any amendments of this nature are, therefore, a violation of the Republican Constitution and as per Section 5 of the Constitution renders them invalid and are tantamount to usurping constitutional powers of the Reserve Bank of Malawi.

"Any amendments in this regard, ought to start from the Constitution and thereafter, the RBM Act," said Mussa.

But MCP's legislator argues that government is lying and that the Section they have quoted doesn't talk about interest rate charging as an exclusive mandate of RBM.

The government statement says section 185 (1) of the Constitution states that there shall be Central Bank known as Reserve Bank of Malawi established by an Act of Parliament, which shall serve as the State's principal instrument for the control of money supply, currency and the institutions of finance and shall serve generally in accordance with the normal functions of a central bank.

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