US embassy cable - 05LILONGWE930

C O N F I D E N T I A L SECTION 01 OF 02 LILONGWE 000930 
 
SIPDIS 
 
STATE FOR AF/S MELINDA TABLER-STONE 
PARIS FOR D'ELIA 
MCC FOR KEVIN SABA 
 
E.O. 12958: DECL: 10/21/2015 
TAGS: ECON, PGOV, KCOR, EINV, KHLS, MI, Corruption 
SUBJECT: MALAWI ANTI-CORRUPTION UPDATE 
 
REF: LILONGWE 829 
 
Classified By: Econoff W. Taliaferro for reasons 1.4 b/d 
 
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SUMMARY 
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1. (SBU) In a recent conference with Malawi's Anti-Corruption 
Bureau, director Gustave Kaliwo described the status of his 
agency's new and ongoing prosecutions.  Three new cases are 
significant: the upcoming deposition of former president 
Bakili Muluzi in an investigation against him, and the recent 
arrests of suspended Secretary to the Treasury Milton 
Kutengule and Chief Immigration Officer David Kambilonje. 
Despite the ACB's limited ability to get speedy convictions, 
the anti-corruption drive is still proceeding apace, with no 
apparent intereference from the President's office. End 
summary. 
 
 
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CURRENT CASES: POLITICAL ENEMIES AND FRIENDS 
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2. (C) In the Muluzi case, Kaliwo showed us copies of checks 
and bank transfers, each in the hundreds of thousands of 
dollars, from the governments of Taiwan and Morocco to 
Muluzi's personal accounts (reftel).  He also said he has 
found specific personal expenditures from those accounts, 
including the purchase of a Bentley automobile for his son, 
Atupele Muluzi, currently an MP who was studying in the UK at 
the time.  Kaliwo also said he has a case based on the 
construction of the Keza office complex in Blantyre, which 
Muluzi built and leased to the Malawi Revenue Authority while 
he was in office.  Kaliwo recently summoned Muluzi for 
questioning, but the latter has succeeded in getting a court 
injunction against the summons.  The next few weeks should 
tell whether that injunction rests on solid legal ground, but 
Muluzi can be expected to continue to delay.  (Note: Kaliwo 
said the ACB had been helped by the timely assistance of US 
Treasury's Carol Kelley, who happened to be at the ACB doing 
a needs assessment for future technical assistance.  Ms. 
Kelley provided some on-the-spot technical advice that moved 
the investigation closer to a conclusion.  End note.) 
 
3. (U) Secretary to the Treasury Milton Kutengule, a key 
player in Goodall Gondwe's finance ministry, was arrested 
after three months on suspension over a suspect bank account. 
 Kutengule had created a sole-signatory account for some MK20 
million ($165,000), ostensibly to handle money for the 
purchase of school buses for Chancellor College.  Kaliwo has 
charged Kutengule with abuse of public office and theft by a 
public servant.  Before taking the Treasury job, Kutengule 
had been President Bingu wa Mutharika's principal secretary 
when the latter was minister of economic planning. 
 
4. (C) On October 18, Chief Immigration Officer David 
Kambilonje was arrested on corruption charges in a case 
involving fraudulent Malawian travel documents.  Three 
foreign nationals had been apprehended with fraudulent 
passports at the airport in Lilongwe, and when Kambilonje 
ordered them released, immigration officials filed a 
complaint with the ACB.  On investigation, it was found that 
Kambilonje had been involved with issuing the papers in 
exchange for a bribe.  Newspaper accounts have pegged the 
value of the bribe at $50. 
 
 
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CASES IN PROCESS 
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5. (SBU) Of the pending cases, Kaliwo offered the following 
status information: 
 
-- Former finance minister Friday Jumbe.  This case is 
awaiting resolution of a technical challenge in the 
Constitutional Court.  Jumbe is charged with profiting from a 
maize scam and using the proceeds to build a Blantyre hotel. 
 
-- Humphrey Mvula.  The former head of parastatal Shire Bus 
Lines is charged with directing parts and end-item contracts 
through relatives for personal profit.  The ACB withdrew the 
case from a magistrate's court on suspicion that the 
magistrate had been coopted.  It has submitted the case to 
the high court, a move that Mvula has challenged. 
 
-- Former education minister Yusuf Mwawa.  Charged with 
misappropriating funds to pay for his wedding, Mwawa is 
scheduled to present his defense in court on November 2, 
nearly a month after the ACB rested its case. 
 
 
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COMMENT 
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6. (SBU) The Mutharika administration continues to chip away 
at corruption, and the President himself has demonstrated no 
desire to interfere with the ACB's operations: the campaign 
has hit close to him, with the arrest of his then-sitting 
education minister and his treasury secretary.  While the 
timing of the summons to Muluzi is suspicious, with the most 
significant development in the case falling in the middle of 
a parliamentary debate on impeachment, Kaliwo has explained 
it as being a function of the timing of a key bit of 
technical assistance from outside Malawi.  It is ironic that 
the Muluzi deposition (and possible arrest) may fall during 
an impeachment trial whose genesis lies in Mutharika's 
refusal to extend Muluzi's kleptocratic patronage system. 
EASTHAM