FINANCE Bank Zambia (FBZ) Limited chairperson, Rajan Mahtani, has alleged that the former regime under president Rupiah Banda, externalised over K50 billion to the United Kingdom and South Africa at the time the bank was under seizure.

Mr Mahtani claimed that a total of K52 billion was externalised through the Bank of Zambia (BoZ) to named UK and South African-based companies.

He made the allegations at a media briefing in Lusaka yesterday, saying the previous regime separately externalised K17 billion to a London-based company and US$7 million (about K35 billion) to South Africa.

Mr Mahtani alleged that the K17 billion was transmitted to a company in London that was contracted to audit the bank shortly after it was repossessed while a named forensics company from South Africa was specifically contracted to investigate Dr Mahtani and was paid an equivalent of K35 billion ($7 million).

The FBZ chairperson said steps had been taken to ensure that the bank recovered the money because the fees were unjustifiably too high.

Mr Mahtani said what was even more worrying was that the audit was undertaken after the bank obtained a court order to restrain the company from going ahead.

Dr Mahtani also said the decision by the previous government to repossess and sell the bank was ill-conceived and was done to punish him because of the long-standing differences the bank had with a former government official before he joined the government.

He alleged that the official borrowed a substantial amount of money from the bank to purchase a house and never paid back until the board decided to grab a house situated in Lusaka’s Kabulonga area.

On the audit, Dr Mahtani said there had been no firm which had ever charged K17 billion for such services and wondered why the BoZ did not engage a local international audit firm.

He said as board chairperson, he was not involved in the whole transaction about the Kabulonga house and there was nothing legally wrong with the decision by the FBZ.

Dr Mahtani claimed that the sale of the bank to First National Bank at K27 billion was purely a political decision and that within the few months it operated under its original shareholders, the bank had made K60 billion profit.

According to Dr Mahtani, FBZ made minor mistakes because the officials were human beings but such did not warrant the closure of a viable business.?

He said FBZ shareholders, Credit Suisse have resolved to fund the 500 million Euro bonds the Government intended to float and hoped to act as an agent to resell the bonds as a way of showing appreciation to the Zambian Government which had reversed the transaction.

Dr Mahtani also said FBZ planned to commence the process of listing on the Lusaka, London and Johannesburg stock exchanges and that 40 per cent shares would be off-loaded by 2014.

He said he faced hardships to seek medical treatment when he was operated on at Milpark Clinic in South Africa while officials from the Drug-Enforcement Commission (DEC) followed him without good reasons.

Dr Mahtani said the bank was expected to pay K20 billion in taxes by the end of the year while the number of workers would rise to around 1,000 before the end of next year.

Meanwhile, FBZ has, with immediate effect, increased salaries for its 734 workers by K2 million across the board with the lowest paid getting at least K4.5 million per month.

[Times of Zambia]

Issued by George Chellah( special assistant to the President on press and public relations)

Dr. Situmbeko Musokotwane, the former Minister of Finance under the MMD government has disputed our factual account that the previous regime illegitimately printed money.

Dr Musokotwane and his colleagues must not panic and resort to half-truths but instead wait for the due process of the law to take its course.
The Republican President, His Excellency Mr Michael Chilufya Sata has repeatedly stated that “this is not a witch-hunt but a legitimate search for the truth.” Let it be known that the President would definitely be the happiest to see that our former leaders are cleared of possible wrong-doing by law enforcement agencies.

Former Finance minister Situmbeko Musokotwane is said to have advised President Sata to stop making careless statement on the Kwacha that could jeopardise Zambia’s international position.

Dr. Musokotane said Sata is lying as all the currency which the MMD left in circulation is genuine and he wondered whether Sata would create another unnecessary Commissions of Inquiry for this matter.

Musokotwane challenged the Bank of Zambia to publicly state its position on this matter and say whether the MMD government ever forced the Central Bank to print money.

PRESIDENT Michael Sata says former Msanzala Member of Parliament, Joseph Lungu, has a constitutional right to resign his seat and join a party of his choice.

President Sata said constitutions world-over provided for resignations and that his Government had made budgetary allocations to take care of eventualities such as death or resignations of parliamentarians like the case was in many countries.

Speaking shortly after he swore in Council of Churches in Zambia (CCZ) general secretary Suzanne Matale, veteran politician and lawyer Rodger Chongwe and Father Elvis Chituba from the Catholic Church as the remaining members of the 20-man Constitution Technical Committee, the president said Colonel Lungu should not be condemned without good reason.

President Sata also swore in David Mabumba as deputy minister of Education, Mutaba Mwali as deputy minister for Transport, Works and Supply, and Brigadier-General Benson Kapaya as deputy minister of Agriculture.?“The biggest problem we have in Zambia like some American professor once said that ‘Everything is our business but our own business’.

Constitutions all over the world in the Commonwealth and non-Commonwealth countries provide for people to resign and for people to be fired,” the president said.

Mr Sata said there were circumstances that would always necessitate the holding of by-elections such as death and resignations while MPs could also be fired.

[pullquote]And they say that it’s an expensive by-election. We have provided for that in the Budget. Supposing you die, are they going to say by-elections are expensive?” President Sata asked.[/pullquote]

Col Lungu resigned as an independent legislator and joined the ruling Patriotic Front (PF) during a public rally at Nyampande Basic School in Petauke at the weekend.

Some civil society organisations and the opposition United Party for National Development (UPND) have condemned the resignation of Col Lungu, saying it has caused a by-election that would be costly.

“You can either be fired by Parliament. You can either be fired by the sponsoring organisation, but then you find there are people condemning Col Lungu who resigned in Petauke. And they say that it’s an expensive by-election. We have provided for that in the Budget. Supposing you die, are they going to say by-elections are expensive?” President Sata asked.

And the president said what was important in composing the Constitution Technical Committee was not to “balance the people but to balance the brains.”?“I congratulate all of you. I have all the confidence in you.

The people will be talking. You see, in Zambia if talking was productivity, Zambia would be second to none. People will complain that you have not balanced but you do not balance people, you balance brains. Counting to see what we have balanced is not how we do things,” President Sata said.

Mr Sata appealed to the technical committee to use their vast experience to produce a document that would be appreciated by the Zambian people.?“You people understand the problems of the citizens. You are not the constitution commission because we have had so many commissions.

We have brought brains together for you to give us a document and you will draw your own terms of reference on how you are going to run the show,” the president said.

President Sata said the technical committee members were at liberty to use material from previous reports of the Constitution Review Commissions such as the Mainza Chona, Patrick Mvunga and Willa Mung’omba reports as well as other relevant materials as part of evidence for their report.

President Sata also announced that the Roman Catholic Cathedral in Roma Township will host the memorial service for the late Mainza Chona this Saturday.

[Times of Zambia]

President Michael Sata has instructed the law enforcement agencies to thoroughly investigate the US$ 1 million held in Mpundu Trust Account.

The directive comes in the wake of revelations that Mpundu Trust has unexplained funds in one of the banks in the country.

“Information we have received is that Mpundu Trust is holding over US$1 million with one of our local banks. Considering the colossal amounts involved in this bank transaction, I strongly believe that it’s only fair and prudent for the Drug Enforcement Commission (DEC), in liaison with other law enforcement agencies to professionally and systematically investigate this matter,” President Sata said.

“Let it be known from the onset that the decision to probe Mpundu Trust is without malice or ill-motive but to simply set the record straight by ensuring that the due process of the law applies. We promised the Zambian people that accountability, transparency and fairness before the law will be the bedrock of our administration, this is what we are doing.”

In another related development, President Sata has directed the Minister of Finance, Hon. Alexander Chikwanda to ensure that billions of Government revenue which is lying idle in one of the local bank is reclaimed by the Ministry of Finance.

“There is a balance of K12.2 billion GRZ funds that must be moved to the Ministry of Finance Treasury Accounts and I want this to be done as soon as possible,” says the President.

Meanwhile, President Sata has expressed deep regret and sorrow at the death of Zambia’s Ambassador to Japan Dr. Mbikusita Wamundila Lewanika.

“Our dear brother, Dr Lewanika served this country diligently and devotedly in various government portfolios and this loss will definitely be felt by many,” the President said.

“Kindly convey on behalf of the People and Government of Zambia and indeed on my own behalf, our heartfelt condolences and sympathies to the deceased’s family and friends.”

The President has authorised Her Excellency Dr. Inonge Mbikusita-Lewanika, Zambia’s Ambassador to Brussels, who is also the deceased’s elder sister to travel to Tokyo on government expense to help with arrangements to repatriate the remains of the late diplomat.

Dr Lewanika died yesterday at 01:00 PM Tokyo time