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CDEDI bites Malawi Central Bank Governor Wilson Banda on leaked political-motivated forensic audit against predecessor Kabambe

LILONGWE-(MaraviPost)-The country’s civil rights group Centre for Democracy and Economic Development Initiatives (CDEDI) has rebuked Malawi Central Bank, Reserve Bank of Malawi (RBM) governor Dr Wilson Banda for purportedly allowed the leakage of the political-motivated forensic audit against his predecessor Dr. Dalitso Kabambe.

CDEDI has taken a swipe at Banda for keeping quite on the leaked audit in social media on Dr. Kabambe’s salary.

The grouping has questioned the legality of the audit firm Deliotte reporting directly to him instead of the central bank board.

addressing the news conference in the capital Lilongwe on Monday, December 28, 2020 CDEDI Executive Director Sylvester Namiwa therefore demanded, “Banda’s office to issue a statement to give the general public accurate information or risk being labelled as an accomplice in all this”

Namiwa questions, “The reason why the auditors are reporting to you directly as the RBM Governor, when the standard governance practices demand that the Chief Internal Auditor (CIA) oversees the audit process and reports directly to the Board.

Namiwa on the right

“Prove us wrong that politics has taken centre stage at the RBM since information is being leaked while the external auditor is doing their job.”

He added, “CDEDI is looking forward to hearing from you, sir, in the next seven days on the issues that have been raised in this letter. You may also wish to know that this matter has attracted huge public interest and anxiety on whether or not the man at the helm of the monetary policy has the required integrity, competency and trust to steer the ship to safe waters or sink the same.

There was no immediate reaction of the Central Bank Governor Banda on CDEDI petition.

On Saturday, December 26, 2020 the Maravi Post exposed Tonse administration’s purportedly political-motivated forensic audit against Malawi’s former Central Bank Governor Kabambe.

Below is the full CDEDI letter to RBM Governor Banda:

RE: VIOLATION OF THE RESERVE BANK OF MALAWI (RBM) ACT

The Centre for Democracy and Economic Development Initiatives (CDEDI) writes you, sir, in reaction to your deafening silence over recent developments surrounding the central bank’s information making rounds in the social media.

To begin with, CDEDI would like to remind you that you are the current occupant of a public office that was established by the Reserve Bank of Malawi Act of 1989 with a very clear code of conduct to be respected and adhered to, including a very clear channel for communication. Additionally, it is worth pointing out right at the beginning that the RBM, just like any other bank is a corporate body with integrity to protect.

That said, CDEDI and indeed all well-meaning Malawians are aware that there is a forensic audit going on at the bank whose report will be out by February 2021.

However, before even the draft report is released, bits and pieces of the same have already found their way into the social media outlets. It is even mind boggling to note that you sir, and the whole communications team have kept quite pretending nothing has found its way out of the central bank’s custody.

This development leaves us with an impression that those people leaking the information are doing so under your watch, and to be raw, we believe this is a calculated move targeting specific individuals from one region and tribe, a very clear case of selective application of justice which CDEDI is vehemently advocating against.

Sir, as you are reading this letter, information regarding your salary and that of your Predecessor Dr. Dalitso Kabambe is in the public domain, a  development that is raising serious questions as to whether or not the bank must cough over MK180 million on external audit only to establish salaries of RBM Governor and a few other employees?

How would you explain a situation where people outside the RBM have privileged information including knowing the agenda and venues for the bank’s meetings and employment contracts?

How credible would the forensic audit be, given the manner in which it is being handled? Since banks handle information in their day to day work around highly confidential and rather very sensitive information, how would the RBM stakeholders including commercial banks trust a Governor who is an alleged accomplice in the leakage of information from the Central Bank?

All these issues put to question your suitability to steer the RBM ship and undermine the Governor’s role as a Registrar of Financial Institutions.

Secondly, CDEDI would like to bring to your attention part V section 6 of the RBM act subsection 3 which states that to ensure continuity, appointments and reappointments into the board shall be made in a such a way that at least one-half of the number of directors shall continue to serve on the board.

Since highly confidential information is already in the public domain, and in the interest of transparency and accountability, CDEDI is challenging you sir, to inform the nation with proof that the RBM board did not violate its own act on the composition of the board.

Thirdly, Sir, CDEDI would like to draw your attention to section 4 (a) subsection 2 of the RBM act which talks of the independence of the bank, thus: “Any person who improperly seeks to influence the bank, or a director or employee of the Bank in its performance of its or his functions, commits an offence shall, on conviction, be liable to a fine of K1,000,000 and imprisonment for four years.” It is against this background that CDEDI would like to seek your clarification on the following:

  1. The reason why the Chief Internal Auditor had reservations with the hiring of Deliotte as external auditors to do forensic audit;
  2. The reason why the auditors are reporting to you directly as the RBM Governor, when the standard governance practices demand that the Chief Internal Auditor (CIA) oversees the audit process and reports directly to the Board;
  3. Prove us wrong that politics has taken centre stage at the RBM since information is being leaked while the external auditor is doing their job;
  4. Explain the deafening silence from your office at a time when private and confidential information has been leaked and is now in the public domain;
  5. Explain why your office has accepted information such as your salary and that of your predecessor’s to be in the public domain when such information is supposed to be private and confidential;
  6. Explain why your office has chosen to use your entry salary as cap, to force officers with running contracts adjust their salaries in line with the cap. This is against existing salary structure within the bank, and if anything, it requires a review of the entire salary structure in order to achieve fairness as it were. You cannot isolate a few positions with employment contracts within the bank and force them to take salary cuts without any justifiable structure reviews, without consent of the individuals; this is against the labour laws. The Bank ought to explain the reasons why people must take a salary cut, otherwise that’s an illegal move on the part of the Bank.

CDEDI is, therefore, demanding your office to issue a statement to give the general public accurate information or risk being labelled as an accomplice in all this.

CDEDI is looking forward to hearing from you, sir, in the next seven days on the issues that have been raised in this letter. You may also wish to know that this matter has attracted huge public interest and anxiety on whether or not the man at the helm of the monetary policy has the required integrity, competency and trust to steer the ship to safe waters or sink the same.

Yours Faithfully,  

Sylvester Namiwa

EXECUTIVE DIRECTOR

Maravi Post Reporter
Maravi Post Reporterhttps://www.maravipost.com/
Op-Ed Columnists, Opinion contributors and one submissions are posted under this Author. In our By-lines we still give Credit to the right Author. However we stand by all reports posted by Maravi Post Reporter.
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