THE 2019 Money Laundering Trends Report may not be released anytime soon this year as the Irene Lombe Chibesakunda-led Financial Intelligence Centre (FIC) board has not given a go ahead for its dissemination to the public.
And Chibesakunda has declined to respond to a press query seeking her explanation on whether she was not conflicted as FIC board chairperson, considering that she has not relinquished her position on the First National Bank board, which is a reporting entity to the FIC.
Meanwhile, sources at the Ministry of Finance have told News Diggers that uncertainty and anxiety has gripped the FIC following the resignation of acting Director General Clement Kapalu, who was expected to launch the 2019 Financial Trends Report after Mary Chirwa took planned leave from work, a month ago.
In June, Chirwa had explained that the 2019 Trends Report, which is usually released before end of May, had been delayed because of COVID-19, saying most officers were working off-site, “making is difficult to complete the verification process on time”.
She added that the internal process was done but awaiting board approval.
“We are done with the report internally, it is just undergoing approvals. As you know, we have a board which also has to approve the report before it goes to the public. We will be able to get to the public I am sure in the course of August. I know that we have our ordinary board meeting at the end of July on the 30th, so at that meeting, hopefully, our report can be approved and then we will be able to release it to the public,” she said.
After Chirwa took leave at the beginning of August, Kapalu who was appointed acting FIC Director General indicated that the report would be released by August 31.
“Nothing has changed from our earlier statement. It will be out this month of August and we are just finalising it. Let’s say by month-end. It could be earlier, but definitely, by the 31st, it will be done,” said Kapalu.
But sources at the Ministry have revealed that the 2019 report may not be released any time soon, because the Chibesakunda-led board was awaiting approval from State House.
“Chirwa and Kapalu are just trying to manage the situation, they can’t say the truth. What is happening is that the board has held on to the report and they have refused to have it released. We are told that some of the money laundering activities that the Centre disseminated to the LEAs (Law Enforcement Agencies) implicates top people in government, including State House. So they are holding the view that if the trends report is released, some member of the public may be able to connect the dots,” the source explained.
“So basically, what we have is a situation where State House feels these Trend Reports, particularly one for 2019 can paint a bad picture of the government and also jeopardize the chances of re-election for the PF. If you recall, there was public uproar when the Centre announced an increase in financial crimes from K4.5 billion in 2017 to K6.1 billion in 2018. So State House doesn’t want that this year, and they have basically told the board not to give a go ahead to its release. Under former FIC board chairman John Kasanga, this report would already have been released, but we are dealing with a board that is not independent.”
A check on FNB records also showed that Chibesakunda had remained on the FNB board despite being appointed FIC board chairperson, a situation the source said created conflict of interest.
“Banks are reporting agents to the FIC. When they pick suspicious financial transactions on company or individual accounts, they provide those details to the FIC which then analyses the data and if they establish a suspected criminal activity, they pass on that intelligence to the LEAs. So you basically cannot have the FIC board chairperson who is also a board member of the bank, a reporting entity. That is conflict of interest,” the source said.
The source also added that the FIC board had been pushing management to remove contentious issues from the report.
“The other thing that has been happening is that management seems to have been resisting the push to tone down the report. You know, I think they had also put in issues to do with erratic funding from our ministry, and all that, the board feels should not be contained in the report, so the guys there are frustrated. There is also uncertainty and anxieties. You may wish to know that the DG (Chirwa) is on her planned leave and the acting DG has thrown in his resignation. We understand the board has accepted his one month notice to leave the Centre,” said the source.
When called to explain why the report had not been released on the date that he had indicated, Kapalu said he would inform the media when the confirmed date for the launch is decided.
Asked if it was true that he has resigned, Kapalu whose substantive position is Director for Monitoring and Analysis, referred the query to the substantive Director General.”
Meanwhile, Chibesakunda declined to respond to a press query sent to her last Friday.
After persistent phone calls on Saturday, Chibesakunda said she was attending to a bereavement, and that she would respond later. Yesterday, Chibesakunda remained unresponsive to further attempt for an interview and still did not provide any response to the press query by press time.
During John Kasanga’s reign as board chairperson, the FIC revealed a 33 per cent increase in the amount of money Zambia lost to financial crimes from K4.5 billion in 2017 to K6.1 billion in 2018. Corruption cases ranked the highest, with an estimated loss of K4.9 billion of the total amount, while Tax evasion ranked second with an estimated loss of K1 billion, with theft ranking third at K110 million.
But President Lungu complained that the FIC was on a witch hunt which was poisoning the country.
“The law has to be revisited so that the FIC, if they see something wrong, they tell the police. If the police don’t act, they follow it up and say ba police tabauza (we have told the police) but they are not doing anything. The law needs to be revised, it’s just creating poison among us. Do you know anyone in that report who stole money or stole six billion or whatever? It’s a mind game, we are being played… I refuse to be part of this mfwiti mfwiti mfwiti, (witch hunt).
Other PF officials and ministers, including the Chief government spokesperson, have been on record stating that the FIC should not be releasing the trends report to the public.
In June 2019, Siliya accused the FIC of jeopardising cases that are under investigation by publishing what she described as half-baked intelligence data.
“This is why the public debate has been about whether this document should have been circulated to the public or that indeed it is first supposed to go to law enforcement. If the law says that the report should be given to law enforcement agencies but the report was given to the public, this is why the Minister of Home Affairs yesterday on radio refereed to that as professional misconduct,” said Siliya.
In September 2019, following the expiry of tenure of the Kasanga-led FIC board, President Lungu appointed new board directors, headed by George Siame, whose appointment was revoked barely 24 hours later, paving way for Chibesakunda who is the current board chairperson.