MILINGO Lungu has disclosed that he entered into a bargain with the State to resign as KCM provisional liquidator and to participate in an audit to reconcile his remuneration fees, in exchange for payment of outstanding fees, dropping of criminal charges and immunity against prosecution.
Lungu has revealed that the various state agents involved in the bargain, led by Principal Private Secretary to the President Bradford Machila, were Attorney General Mulilo Kabesha SC, Solicitor General Marshal Muchende SC, Director of Public Prosecutions Lillian Fulata Siyunyi SC, Special Assistant to the President for Legal Affairs Christopher Mundia and Administrator General and Official Receiver Natasha Kalimukwa.
He discloses that he was approached by these State Agents to negotiate a settlement for his exit after a crisis ensued at KCM which put its assets and business at risk.
Lungu further discloses that the Solicitor General informed a meeting called by him (Muchende) on March 14, that he together with Machila had been tasked by the President to deal with the subject matter of his resignation from KCM, adding that in the said meeting, an agreement was reached as regards how he was to exit from his said position.
He has also revealed that in furtherance of the bargain, he resigned as Provisional Liquidator, while the DPP, pursuant to the Immunity Agreement, entered nolle prosequi in the matters pending before magistrate Felix Kaoma for the alleged theft and money laundering involving K4.4 million and those before magistrate Jenipher Bwalya for alleged theft and money laundering of K17.25 million.
The former KCM provisional liquidator has therefore petitioned the Constitutional Court, seeking a declaration that the DPP, having granted him immunity against Prosecution in matters relating to his performance as Provisional Liquidator of Konkola Copper Mines PLC (In Provisional Liquidation), the purported arrest, and commencement of criminal proceedings against him following his re-arrest is an abuse of criminal proceedings and ultra vires Articles 180 (7) and 2016 (c) of the Constitution of Zambia as amended.
Lungu has cited the Attorney General, DEC, Boyd Munalula in his capacity as senior investigations officer under DEC’s Anti Money Laundering Unit and the administrator general as respondents.
He also wants an order of prohibition directed at the State and DEC, restraining them from investigating, arresting and prosecuting him in respect of his performance as KCM Provisional Liquidator as well as an order to quash DEC’s decision to charge and arrest him on April 7, 2022, for the offences of theft and money laundering of K4.4 million belonging to KCM and being found in possession of property suspected to be proceeds of crime.
Lungu further wants an order of mandamus directed at DEC to immediately release to him all documents, books, accounts and properties seized in the course of investigations, an interim relief by way of stay of criminal proceedings pending determination of this matter, among other reliefs.
Lungu stated in his petition filed in the Constitutional Court, Tuesday, that he was appointed as KCM Provisional Liquidator on May 21, 2019, by the High Court by way of a Court Order.
He argued that he was entitled to remuneration at a commission of 10% on the sale of any of the KCM assets for the performance of his duties as Provisional Liquidator and that the same was agreed with the administrator general at 10%.
Lungu submitted that through his industry and effort, he produced revenue in asset sales in excess of US$1.2 billion from the period of his appointment on May 21, 2019, until his resignation on March 17, 2022.
He added that his debt enjoys priority over all other debts in accordance with the Corporate insolvency Act.
“Notwithstanding that the petitioner (Lungu) had priority against all other creditors, the petitioner as provisional liquidator made drawings of about US$10million against the total commission receivables due from Konkola Copper Mines PLC (In Provisional Liquidation) which includes the sums of K4, 400,000 and K17, 250,000 which later became the subject of criminal charges by the third respondent (DEC),” Lungu stated.
He disclosed that as a creditor, he exercised a lien on the assets of KCM by transferring some monies belonging to the mining company to the Lungu Simwanza and Company clients account to secure the debt owed to him pending reconciliation of the statement of accounts between KCM and himself.
Lungu stated that he later learnt through media reports that the Financial Intelligence Centre then under the authority of Mary Chirwa, without reasonable justification, had made a decision to freeze all KCM accounts, Lungu Simwanza accounts as well as his personal accounts.
“Our petitioner shall aver that the respondents have unreasonably and unjustifiably refused to recognize or give effect to the Remuneration Agreement and all payments made to the petitioner thereunder and have treated every such payment as an act of theft and money laundering and any property derived therefrom as proceeds of crime. It is arbitrary, unreasonable and an abuse of criminal proceedings to seize property, arrest, charge and prosecute the petitioner for acts that have not formed the subject of any criminal complaint by Konkola Copper Mines Plc (In Provisional Liquidation) and were done within the confines of the law,” the petition read.
Lungu disclosed that after he was purportedly suspended as KCM provisional liquidator and upon his refusal to vacate office, a crisis ensued at KCM which put its assets and business at risk.
He stated that in order to resolve the impasse, he was approached by various State Agents to negotiate a settlement for his exit, stating that the matter had become one of both state and public interest.
“Your petitioner entered into a bargain with the State as represented by various State Agents spear headed by Mr. Bradford Machila-Principal Private Secretary to the President and included Christopher Mundia – Special Assistant to the President for Legal Affairs, Mr. Mulilo Kabesha SC – Attorney General, Mr. Marshal Muchende SC Solicitor General, Mrs Lillian Fulata Siyuni SC – Director Public Prosecution and Mrs Natasha Kalimukwa Administrator General and Official Receiver to resign as Provisional Liquidator for Konkola Copper Mines Plc (In Provisional Liquidation), submit to and participate in an audit to reconcile the petitioners’ remuneration fees and any monies drawn with full and frank disclosure in exchange for the payment of fees due and outstanding, dropping of criminal charges and an indemnity or immunity against prosecution in respect of any acts or commission done in the performance of the petitioner’s duties as Provisional Liquidator,” the petition read.
“The bargain was made in the public and State interest to secure a critical national asset from ruin and loss as no payments could be honored by the banks on account that The Official Receiver who had purported to take over the running of KCM had no legal mandate to manage and administer Konkola Copper Mines Plc (In Provisional Liquidation). Further to enable the petitioner provide critical information to the auditors without running the risk of self-incrimination and also to reconcile the statement of account between Konkola Copper Mines PLC and your petitioner made on the understanding that the matter was of a civil and not criminal nature.”
Lungu submitted that the bargain was evidenced by two agreements namely, the Consent Settlement Agreement dated March 17, 2022, drafted by Mundia and executed between him (Lungu) and Kalimukwa in her capacity as Official Receiver as well as an Immunity Agreement made on March 22, 2022 between him and Siyunyi in her capacity as the Director of Public Prosecution.
“In furtherance of the bargain and pursuant to the consent settlement agreement, your petitioner resigned as Provisional Liquidator on March 17, 2022 and pursuant to the Immunity Agreement, the DPP on April 5, 2022 entered nolle prosequis in the matters pending before hon Felix Kaoma for the alleged theft and money laundering involving K4.4 million and those before hon Jenipher Bwalya for alleged theft and money laundering of K17.25 million,” read the petition.
“In breach of the bargain, agreements and petitioner’s rights, the second and the third respondents have continued with investigations and threatened the petitioner with further arrests and re-arrests on facts founded on the performance of his duties as provisional liquidator of Konkola Copper Mines PLC (In Provisional Liquidation).”
And in his affidavit verifying facts, Lungu stated that at the time of the seizures of the accounts by FIC, the information of the said action and the account details involved found itself in the News Diggers Newspaper of September 2021.
He stated that following those events, he requested and was granted permission to hold a meeting with the President.
“Following these events, I requested and was granted permission to hold a meeting with His Excellency the President of the Republic of Zambia Mr Hakainde Hichilema and present at the meeting were the Vice President Mrs Mutale Nalumango, the Minister of Finance Dr Situmbeko Musokotwane and Mr Bradford Machila. In the said meeting inter alia, I informed them that my position was untenable considering the ongoing investigations to which the President advised that he would revert at the earliest,” stated Lungu.
“On or about 4th January 2022, I was invited to a meeting with the Solicitor General and present therein was the petitioner (Lungu), his lawyer Mr Lusenga Mulongoti and the Solicitor General Mr Marshal Muchende SC, at which the issue of my resignation was discussed. In the said meeting, the Solicitor General mentioned that he was discussing the matter at the instance of the President of the Republic of Zambia and as a follow up to the meeting that I had with the President as set out above. That offer to resign and attendant conditions discussed in the meeting was reduced in writing in a letter to the Attorney General wherein I offered to resign on condition that there was a clean break with issues and matters relating to KCM.”