A SCANDAL has emerged at Konkola Copper Mines (KCM) in which the mining giant, which the Zambian government repossessed from Vedanta Resources in 2019, has paid US$1.6 million (about K32 million) to a company allegedly bought by liquidator Milingo Lungu through his relative Dingiswayo Ndhlovu, for the supply of Heavy Fuel Oil (HFO).
Meanwhile, PF cadres are up in arms fighting for the ownership of Cashfin, the company that has received the US$1.6 million from KCM.
According to KCM sources close to the liquidator, Milingo approached Chilinda, a known PF cadre, asking to buy his company.
“There is this well-known PF cadre called Joseph Chilinda, who is a friend to Milingo. Chilinda has been doing some businesses on the mines with some other PF cadres through some contracts with mining companies. This cadre is the original owner of a company called Cashfin Zambia Limited which he had been using to win supply tenders. So, Milingo approached this cadre and told him that he was interested in buying his company, Cashfin, and he agreed. They agreed that he was going to sell the company for a token of US$500,000,” the source narrated.
“As a brother who was trying to help this cadre, Milingo offered him that he was going to give him US$10,000 in cash and that the remaining US$490,000 balance was going to be settled through a tender from KCM. So, on that material time, Milingo went ahead to pay the first US$5,000 in cash and he later advanced another US$5,000 cash, making it USD10,000. After showing goodwill to this cadre, Milingo then asked that to safeguard his interest in the company, his relative, Dingiswayo Ndhlovu, should be added as a signatory. So they opened a company [account] at Stanbic in Ndola where Ndlovu was added as a signatory.”
The source further narrated that Milingo honoured the agreement by approving a KCM tender to Cashfin for the supply of HFO worth US$1.6 million, but that immediately after the payment hit the account, Milingo through his signatory withdrew a sum of US$1.1 million and paid to other unknown third parties.
The source narrated that this prompted Chilinda to also take out his US$490, 000 balance for the sale of the company without approval from Milingo and went on to remove the new signatory, Ndlovu, from the bank records; a move that angered Milingo.
“On June 30, [this year] there was an order from KCM to supply HFO worth US$1.6 million. The order was made in the morning and US$800, 000 was advanced to Cashfin, and Milingo made sure that the same day in the afternoon, the outstanding balance of US$800, 000 was paid to the company. Of course, the goods were not supplied, but this was an effort by Milingo to help this cadre get his payment. But because of greed, after seeing that the Milingo’s relative had moved US$1.1 million out of the Cashfin account, he also started making maneuvers to take out his share, but without approval from Milingo who had made this whole deal possible. That is how Milingo now started fighting back and distanced himself from the whole deal,” the source said.
“You know, even when the DEC wanted to arrest him for money laundering, this Chilinda cadre went to cry to Milingo and it was Milingo who helped him out. There was an interview done for him, after which DEC told him that they had frozen the account and even gave him a seizure order. He communicated with Milingo who asked him to give him the name of the person who queried him from the DEC side. After political pressure, DEC removed the seizure notice on the account. But after all that, this cadre claimed that he was being used. He started demanded that he should be paid his US$490,000 so that he can stay away from Cashfin, that’s when Milingo disowned him now.”
The source said it was at this point that the cadre Chilinda wrote to the bank, asking that Ndlovu be removed as a signatory, which was done.
“The problem is that Milingo’s team did not change the details at PACRA after paying that down payment. So the records at PACRA still show that Chilinda is the owner, and so this cadre took advantage of that, went to the bank and removed Milingo’s contact as a signatory from the account. After managing to have the seizure notice removed, Ndlovu discovered that he had been removed as a signatory at the bank and the US$490,000 had been taken out from the account. This is when the fight between cadres started; Milingo’s team vs Chilinda,” said the source.
A separate source at the Drug Enforcement Commission disclosed to News Diggers that after the US$1.6 million hit the Cashfin account, a whistleblower from KCM reported Chilinda for a case of suspected money laundering.
“We received that report and we summoned the said Chilinda for interviews here. In fact, the accounts for the company were frozen at some point, but there was some intervention from above and that investigation was halted and the seizure notice on the account was lifted. Some days later, what we saw was that the same Chilinda was arrested by police in Lusaka on a charge of theft and he was detained for seven days. I understand that he was not in good health and he was taken to UTH where he was then released on police bond,” said the source.
When’s contacted to explain his side of the story, Chilinda said he had been in hospital and was not available for any interview.
And efforts to reach the KCM liquidator proved futile as his phone was unreachable by press time yesterday.