What Drives Capital Hill Cashgate Scandal Corruption In Malawi And Why It Won’t Disappear Soon

It is now two years since Malawi was rocked by its biggest government corruption scandal in history. The systematic looting of public coffers by civil servants, private contractors and politicians saw them steal US$31 million from government coffers.

It is estimated that about 35% of government funds have been stolen over the past decade. The impoverished country’s national budget for 2013-14 was about US$1.3 billion (630.5 billion Kwachas) at today’s exchange rate.

But has the country learnt anything from its biggest scandal that saw donors withdraw support?

The University of Malawi’s Blessings Chinsinga recently pointed out that:

efforts to root out corruption do not stick because the existing institutional milieu makes it almost impossible to introduce changes that can effectively stamp out corruption.
The observation is instructive in that the scandal spans two political administrations. Malawi was led by the late president Bingu wa Mutharika in 2004 and the scandal unravelled on the watch of Bingu wa Mutharika in 2013.

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Fertile ground for corruption

A number of factors contribute to the current state of affairs.

There is no clear distinction between a party in power and government activities in Malawi, unlike in established democracies. In Malawi, the party in power is the de facto government.

In Malawi, a party in power calls itself boma (a government). Ordinary Malawians look at abuse of state resources by those in power as acceptable. It is almost impossible to tell a party in power from the government.

Even more serious is the fact that political parties in Malawi are not mandated to declare their sources of funding. This breeds corruption and fosters abuse of public resources. This is not unique to Malawi. But in countries like Botswana, hailed as one of the model democracies on the continent, they at least have a debate on political party funding. Debates are also taking place in Nigeria and South Africa, respectively the continent’s largest and second-largest economies.

Another contributing factor is that after 21 years of multiparty democracy, governance in Malawi remains heavily centralised. Although the country has been independent since 1964, it only became a democracy in 1994.

Until then, it had been a one-party state decreed by its first post-colonial leader Kamuzu Banda, who banned political parties. He became president for life in 1971. Since 1994, the country has had local government representation for only six years – from 1999 to 2004 and from 2014 to now.

The central government has been reluctant to relinquish some of its powers. The president makes even the smallest of decisions and undertakes mundane tasks that should be reserved for line ministries. This encourages a system of patronage.

Lastly, government contracts, tenders and board memberships all go to sympathisers of the party in power and not necessarily to the best bidder or the most competent applicant. Government sympathisers or ruling party members get contracts regardless of their levels of competence.

This unfairly benefits the incumbents and weakens opposition parties. Businesspeople are afraid of funding opposition parties because they could lose state contracts and other business opportunities.

Scale and depth of corruption exposed

Malawians have always known that corruption is rife in the country. But the sheer size of the Cashgate scandal, both in terms of the amount and the wide number of people involved, has shown how deeply rooted the problem is.

The involvement of the country’s political class in the scandal is in stark contradiction to their penchant for standing on political campaign podiums promising to fight corruption with all their might.

Most of the people implicated in the Cashgate scandal were either members of the then-ruling People’s Party or its sympathisers.

There is an unwritten rule in Malawi that successful businesspeople align themselves with the governing party in order to protect their property and gain more contracts.

An aunt of Oswald Lutepo, thus far the main Cashgate convict and serving 11 years in jail, was heard in court lamenting that her nephew was advised that he did not need to join politics as he was already a successful businessman and multimillionaire. At the time of his arrest Lutepo was deputy director of recruitment in the People’s Party.

The aunt’s lament is instructive: people join politics in Malawi mainly to make money. In terms of this logic, the 37-year-old Lutepo was already a millionaire. He should have stayed out of it.

But he could not escape the lure of more riches that flow from being close to those in power. He knew the unwritten rule for success in Malawi only too well:

If you are unsuccessful, support the ruling party because this is where opportunities are.
Malawi is still learning to cope without support from donors and the jury is still out on whether it has learnt anything from its biggest scandal. A recent article in African Arguments underlines the hopeless feeling that Cashgate has left among most Malawians:

Malawi’s self-enriching officials need to know they will be judged not just by an imperfect judicial system, but by generation upon future generation of their compatriots.

Capital Hill Cashgate Malawi Arrests Chief Suspect In Cashgate Scandal

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A chief suspect in Malawi`s “Cashgate” corruption scandal, who was a high-ranking official and financier of president Peter Mutharika`s Democratic Progressive Party, was arrested by police on Sunday.

Oswald Lutepo was held days after sending a letter to the Attorney General claiming he was threatened and told not to implicate Mutharika in the “Cashgate” allegations, the biggest financial scandal in the history of the small southern African country.

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“Yes, Mutharika has been re-arrested and he will be charged for perjury,” police prosecutor Rodwel Ziyaya from Kasungu district in central Malawi, told AFP.

Lutepo was arrested in November last year for money laundering after he allegedly pocketed $6 million (4.4 million euros) from government coffers through ghost companies which did not provide any services to the state.

“Cashgate” erupted after an audit ordered by former president Peter Mutharika found that $30 million in state funds had been looted by officials in less than six months last year.

The scandal led international donors to suspend $150 million in aid to Malawi, where half of its 15 million people live below the poverty line.

In his letter, which was also addressed to Western embassies, Lutepo claimed he was “warned against linking Cashgate to the (former) head of state, her family and the Democratic Progressive Party”.

He also said that he was threatened and told to “implicate” former justice minister in the shooting of budget director and corruption whistleblower last year, the incident which sparked “Cashgate”.

She was defeated in a hotly-contested presidential election in May.

In February this year, a report by British auditors — commissioned by Mutharika — showed that $30 million had been stolen from the government within a six-month period last year.

Cashgate Scandal Malawi: President Mutharika Caught on Camera in a Salacious Scandal

Malawi’s latest salacious scandal involves the highest office in the country. The manner in which President Peter Mutharika kissed his wife, Gertrude Mutharika during a much publicized Democratic Progressive Party Valentine’s day fundraising dinner has caused quite a stir in Malawi and on social media.

The event took place on Saturday, February 14th, 2015 in Lilongwe. Dawned in a black Chinese collar suit with a red bow tie, Mutharika presented a bouquet of flowers to his wife in celebration of Valentines Day. Then after being coaxed by the event’s host, he kissed the First Lady who was clad in a red dress in front of attendees and television cameras who were broadcasting the event to the entire nation.

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Since this controversial public display of affection, Malawi has been abuzz with regards to the nature and length of the kiss in a controversy I dub ‘kissgate’.

Some of Malawi’s social media communities have been particularly harsh on Mutharika. Critics have argued that the President should not have kissed in wife in public because it was contrary to Malawian culture. They called the act of public kissing a “taboo” and have made references to it as evidence of moral corruption and cultural erosion in Malawi. They argued that kissing in public was something that was ‘unMalawian” and stemmed from Western values. Adding to the accusations that it was not Malawian, his decision to wear a Chinese suit was also came under attack.

As others scrutinized photos or replayed the video of the kiss, they argued that the kiss itself was alright but that the use of the presidential tongue in kissing for television was the real issue at hand. They argued that using ones tongue to kiss ones wife was not befitting for the highest office in the land and called it “disgusting”. They would have preferred that the President gave his wife a peck on the lips at such a function rather than what they perceived was a French kiss, which indicates an overt sexual act. Detractors alluded that his kiss that was too long, too fervent and hence, sloppy. One such commentator on the Nyasatimes was so disturbed and agitated by the presidential couple’s kiss that he opined, “Get a room you slobbering, couthless (sic) nincompoops!”

Many others were further irked by the accompanying comments that President Mutharika made to his wife during the presentation of the flower: “on this special day, I want to say thank you! Thank you for always being there for me through the frights and the cold nights….” The references to ‘cold nights’ were highly problematic for the country’s conservative citizens who would have rather have had that conversation relegated to the bedroom and not a public event.

Others on social media took it as an opportunity to use it as a platform to comment on his overall performance as a president. Chakwanuleka notes that “This fellow is a non performer (sic) and this is what he can do best”. More serious economic connections were also made in relation to who paid for the flowers and the party event. A few commented that regardless of who paid for it, holding such a lavish event in the middle of an on-going national flood disaster was insensitive.

Not everyone of course was against the president’s actions. Some Malawians were content that on this Greco-Roman Holiday, Malawian President Peter Mutharika kissed his wife French style in a Chinese suit. After all, are we not living in a globalized era where cultures cross? His supporters state that kissing in public was no more “unMalawian” than “wearing clothes” or doing anything we want to wrongly label “Western”. Others argued that it gave the President more of a human face and applauded him for being down to earth. They called it a “romantic” gesture on his part. Many suggested that it was a good move on his part to be able to show respect for his wife in this way. They argued that it would encourage other Malawian men to show affection and commitment to their wives in public as well.

Capital Hill Cashgate Scandal: Malawi President Longtime Aide Ben Phiri Under Investigation After Becoming Instant Billionaire

Malawian President Peter Mutharika’s longtime aide is wrapped in a corruption scandal after reports surfaced that he had become an instant billionaire in one of the world’s poorest countries. Ben Phiri, former special adviser and assistant to the president, is under investigation by Malawi’s Anti-Corruption Bureau after he apparently amassed a remarkable fortune in one year while earning a modest government salary, according to local media reports.

Phiri stepped down from his post last week following the accusations of wrongful self-enrichment, saying his resignation would allow investigators to carry out their probe. Anti-Corruption Bureau spokesperson Egrita Ndala said the department learned of Phiri’s alleged wealth through media reports, according to Malawi Nyasa Times.

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More than 40 percent of Malawians live below the poverty line of $1.25 per day. The southeastern African nation ranked 160 out of 182 countries on the Human Development Index. Malawi consumer and human rights activist John Kapito has urged the public to scrutinize the monies declared by public officials, including Phiri and Mutharika, who have made their assets public according to the Malawian constitution.