News Beyond News

Malawi’s new regime corruption fumigation overdrive turns heat on Kenyan pension firm, Zamara Group

3 min read
Spread the post

The recent change of guard in Malawi leadership where an opposition candidate trounced the incumbent has seen anti-corruption stance tougher and high-profile graft prosecution in a bid to tame runaway corruption in tiny southern African country. Unsurprisingly a Kenyan financial consulting and pension management firm Zamara Group is the casualty of the new Malawian regime onslaught on graft.

The firm is in the eye of a storm in an ongoing push for investigations into alleged irregular procurement of a contract for administration of a pension scheme for retired Malawian civil servants. The Malawian Human Rights Defenders Coalition (HRDC), watchdog group behind incessant calls for investigation is urging the Malawian Anti-Corruption Bureau to investigate circumstances under which the Public Service Pension Trust Fund appointed Zamara as the administrator of the public service pension fund in the country.

The rights watchdog group questions Zamara’s Kenyan roots and legitimacy to conduct business with no foothold in Malawi and as such do not qualify to be awarded government business of this magnitude, with the value of the Malawian civil service pension scheme estimated at 0.4 percent of the total public wage bill. On this regard, the rights group – HRDC has forwarded its complaints to the Anti-Corruption Bureau and other law enforcement agencies to investigate what he terms as an irregular procurement.

“Following our whistle-blowing initiative we received an allegation and our organization forwarded the allegation to the Anti-Corruption Bureau to address it,” said Mr. Trapence, head of HDRC.

The rights group, HRDC questions the award of a serious contract affecting the livelihoods of senior citizens of Malawi to a foreign company on dubious grounds. The Public Service Pension Trust Fund had, in a notice published in the Malawian press, indicated that it had finalized the evaluation process and intended to award the K556.8 million ($741,000) contract to Zamara Pension Administrators Ltd.

In the letter addressed to the Anti-Corruption Bureau director-general Reyneck Matemba, HRDC demands answers as to why Malawian companies such as Old Mutual, National Bank and Nico Life which applied to be administrators of the scheme were trounced by the “foreign” firm Zamara Group.

Zamara Group CEO Sundeep Raichur however refutes claims by HDRC that they don’t have local presence citing purchase of a Malawian firm last year as grounds that formalized their status as local firm and as such entitled to the contract. Mr. Raichur adds that Zamara Pension Administrators Ltd (Malawi) is only majority owned (51 per cent) by the Kenyan entity, but has a Malawian partner that has been operating in the country.

He said Zamara Kenya acquired a controlling stake in Malawi’s Axis Pension Administrators Services Ltd, a subsidiary of the Ghanaian Axis Pensions Group Ltd, last year and rebranded to Zamara Pension Administrators Ltd (Malawi) early this year.

HDRC’s, Mr. Trapence without substantiating evidenced alleged that Zamara flew the pension fund trustees to Kenya “for an unknown meeting.”

“We urge the Anti-Corruption Bureau to suspend the award of the contract and carry out urgent investigations,” reads the letter from the rights group adding that Malawian pension funds should be managed by a company with traceable roots “and not some company whose only aim is to make profits from senior citizens’ money.”

The Kenyan industry regulator, Retirement Benefits Authority (RBA), said it was aware of the allegations being made against Zamara. Zamara Group manages close to Ksh300 billion ($3 billion) worth of pension funds in Kenya.

According to Zamara boss Mr Raichura, he is not aware of procurement irregularities and that Axis Pension Administrators Ltd (Malawi) had initially tendered for the same government business and lost, but believes with Zamara Kenya on board the new outfit is more qualified and competent to handle the lucrative contract.

“They bid before for the same business and lost. So, there was an open tender which we participated in and we won it. We believe we are well qualified, competent and also our company is not a new entity in Malawi. It has been in existence for a number of years and we simply came in as majority shareholders,” said Mr Raichura.

Spread the post

Do you have a groundbreaking story you would like us to publish? Please reach us through info@254news.co.ke. Contact 254news.co.ke Instantly.