Former president Joyce Banda appears in the US FinCEN files which have revealed how some of the world’s biggest banks have allowed criminals to move dirty money around the world as she was investigated over Malawi government’s arms procurement deal with South Africa’s Paramount Group.
Financial Crimes Enforcement Network (FinCEN), an agency in the US Department of the Treasury, who combat financial crime, has more than 2,500 highly confidential documents – the FinCEN Files – that have been seen by Nyasa Times as part of the latest project from the International Consortium of Investigative Journalists (ICIJ).
Banda is featured in the report which was written by Barclays Bank which commissioned Orbis Business Intelligence – owned by Christopher Steel, a former British spy famous for his role in investigating Russia’s meddling in the election of US President Donald Trump.
The report puts Banda in spotlight with her administrations barter-trading the Presidential Jet Dassault Falcon 900EX, valued at $15 million, to a Paramount Group subsidiary as part of the settlement for the arms deal. The jet was sold in 2012.
According to the report, Paramount – Africa’s largest private defence and aerospace firm and its founder Ivor Ichikowitz benefitted from their cosy ties with African leaders by being awarded major contracts and Joyce Banda is mentioned alongside South Africa’s ex-president Jacob Zuma as some of the leaders.
Banda administration had a deal with Paramount Group to supply Malawi with equipment that includes seven interceptor boats and training for the Malawi Defense Force (MDF).
The boats were delivered and deployed to maritime border patrol duties on Lake Malawi.
The deal also covered the supply of modern combat and camping gear for MDF units deployed on active combat with the Southern Africa Development Community Rapid Intervention Brigade, fighting rebel groups and militias in the eastern Democratic Republic of Congo.
The deal also gave the South African company lucrative contracts in the fuel trade and agro-trade businesses.
When Banda bartered the jet, she continued to use it regularly to travel to events around the continent. The trips formed part of a total of 20 private plane flights she took in just three months at the end of last year, it was said.
But when Banda was dealing with Cashgate, a major scandal over corrupt procurement deals made by government departments, leading foreign donors including Britain to suspend direct aid that had accounted for 40 per cent of the impoverished country’s budget, a family foundation run by the directors of Paramount was paying for Bell Pottinger, a London PR firm, to burnish Banda’s image.
However, Banda has maintained that she did not break any law in the awarding of the contract to Paramount Group and that she was not personally involved in the procurements of the boats.
“Allow me to make is very clear once again. President do not award contracts in Malawi,” said Banda in an e-mailed comments to ICIJ.
Banda states that she was informed that Bell Pottinger “certainly did not play any role in the awarding of the boat contract; hence any such suggestion is malicious and false.”
She could not comment on the relationship between defunct Bell Pottinger and Paramount.
Banda said the boats contract was not awarded by her as a sitting President at the time, stressing that the contract between Malawi Government and Paramount was concluded according to Malawian Government processes and was signed by both the Ministry of Finance and the Ministry of Defence.
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She said at the time of signing, a legal opinion was sought from Malawi Attorney General “confirming both the legality of the agreement and its validity under Malawians law.”
However, the deal was cancelled in August 2014 following a change if administration as the then Minister of Finance in the Peter Mutharika, Goodall Gondwe, who had also served Banda and Minister of Economic Planning, said the deal was substantially over-valued while its repayment terms were unsustainable for the struggling economy.
The bulk of the documents in the FinCEN Files were leaked to BuzzFeed News, which shared them with the ICIJ and 108 other media partners, including the BBC.
FinCEN “collects and analyses information about financial transactions in order to combat domestic and international money-laundering, terrorist financing, and other financial crimes,” according to the agency’s website.