Former Reserve Bank of Malawi (RBM) Governor Dr. MacDonald Mafuta Mwale has launched a scathing attack on the Public Service Pension Trust Fund (PSPTF) Board, accusing it of blatant defiance of regulatory authority in the controversial acquisition of the Amaryllis Hotel.
Appearing before the Parliamentary Public Accounts Committee (PAC) on Wednesday, Mwale said the PSPTF Board ignored clear directives issued by the Registrar of Financial Services and proceeded with the transaction in violation of established financial regulations.
Mwale told the Committee that the Board disregarded key investment rules that require pension funds to maintain prudent and balanced portfolios, warning that concentrating heavily in illiquid assets such as property puts pensioners' funds at risk.
He stressed that PSPTF was legally required to seek prior approval from the Registrar before proceeding with such a transaction, or formally request a waiver if it intended to act outside regulatory limits. According to Mwale, neither of these steps was properly followed.
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"What we have seen here is a complete breakdown of respect for regulatory authority. We have never witnessed this level of disregard by any financial institution in Malawi. This is unprecedented," Mwale said.
He warned that such conduct undermines the entire regulatory system, noting that laws and oversight mechanisms can only function when institutions comply with them.
"For regulators to do their job effectively, there must be respect for the law. What happened here sets a dangerous precedent," he added.
Mwale has since challenged the PAC to widen its investigation and bring the PSPTF trustees under intense scrutiny to explain their actions.
"We are calling on PAC to go deeper and fully investigate the trustees. They must be thoroughly questioned to establish whether there were external influences and why they chose to ignore regulatory directives. The nation deserves clear and honest answers," he said.
He further urged the Committee to move with urgency, warning that the prolonged controversy is weighing heavily on the country.
"This issue has gripped the nation to the point of paralysing attention. It must be resolved quickly so the country can refocus on economic growth," Mwale said.
PAC is currently conducting a special public inquiry into the Amaryllis Hotel acquisition, a deal that has triggered widespread concern over transparency, due diligence, and value for money in the management of pension funds.
The inquiry is drawing in high-profile figures as the Committee intensifies its probe. Officials from National Bank are expected to appear on Thursday, April 23, followed by former Secretary to the President and Cabinet Colleen Zamba on April 28.
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Further hearings will include the Board of Yusuf Investments Limited on April 29, while Chief Secretary to the Government Dr. Justin Saidi is scheduled to testify on May 4.
The outcome of the inquiry is expected to be pivotal in determining accountability in one of the country's most contentious financial transactions.
