Monday, December 24, 2007

Chiluba goes for Mahtani again

Chiluba goes for Mahtani again
By Brighton Phiri and Amos Malupenga
Monday December 24, 2007 [03:00]

Former president Frederick Chiluba yesterday said he regreted having brought Mahtani near State House. But Mahtani yesterday said he is now convinced that Chiluba is sick and has requested all Christians to pray for his health to enable him face the courts when these matters are brought before him. And Chiluba said the allowances allocated to the National Constitution Conference (NCC) delegates were justified.

Addressing the press at his Lusaka's Kabulonga residence yesterday, Chiluba said there were many instances and tales he could remember which made him regret ever having brought Lusaka businessman Rajan Mahtani near State House.

"I can only for the sake of time make reference to some of them so that those who seek the truth will grasp it. My former Vice-President, Lt General Christon Tembo, suggests that there is something personal between me and Mahtani and that he knows the source of the differences. No, that is far from the truth and if he knew or knows anything I related to him, it could only be the time he was Vice-President.

But I had Vice-Presidents before him and another after him so his knowledge is extremely limited as he does not know much about the man. Besides no President tells everything to his number two," Chiluba said. "There is nothing personal as will be seen in due course.

My friends at The Post Newspaper also gave examples of my brother and comrade VJ Mwaanga and Dr Rajan Mahtani, a 'brother in Christ' as he calls himself, as good examples of those friends I. failed to look after well or disappointed. As far as I know VJ still remains a dear brother and Comrade and whatever we did for each other is not for publicity, just know that he is still my brother. As for Dr. Mahtani, the picture is different."

Chiluba said at some point in office, he began to open his office door to Mahtani, rather reluctantly and with a lot of trepidation because of his terrifying experiences with him. He said he burnt his fingers in his effort to try and help Mahtani in his business deals and operations.

Chiluba said Mahtani through his company Furncoz failed to deliver the school desks after his government engaged them to supply a substantial number of school desks with billions of kwacha. He said the Ministry of Education paid the money upfront but the desks were not received until then permanent secretary in the ministry Dr Kasanda reported the matter. Chiluba said he summoned Mahtani to State House.
"First he said he had delivered the desks to schools but when the ministry officials told him that they had visited the school he was mentioning, before the meeting and found no desks, he then said yes, he took back the desks from schools immediately after they were delivered because he wanted to deliver to other schools as well at the same time," Chiluba said.

" It was pathetic. One wonders what could have happened if ministry officials did not inspect the schools! This was one of such frightening experiences with Rajan Mahtani."

Chiluba revealed that his second episode with Mahtani was when he (Mahtani) asked him to introduce him to former Malawian president Bakili Muluzi in order to establish Finance Bank in that country.

"I willingly called my brother Dr Muluzi and asked him to allow Dr. Mahtani to open Finance Bank for the first time in Malawi. I cannot remember how many years his bank operated in Malawi, but it worked for quite a while.

However, the Bank of Malawi was infuriated refusing to stomach any illegalities unorthodox behaviour and ordered Finance Bank closed for alleged illegal externalization of foreign exchange from Malawi," Chiluba said.

"It was one of the saddest days of my presidency in which I regretted having brought my country and my leadership in disrepute. President Muluzi called and rather somberly said 'my brother how could you introduce a conman to me your brother?' I sat back crestfallen for unwittingly betraying my brother Muluzi's confidence and trust.

There are many such instances and sad chapters in my relations with Dr. Mahtani which only helped me to distance my self because he progressively became the epitome of greed, insatiable greed. Each time I saw him, I feared I was looking neo-colonialism or imperialism itself in the face."

Chiluba wondered whether the Bank of Zambia (BoZ) was informed by the Bank of Malawi of the reasons why Finance Bank was closed.

"Were the allegations of illegal foreign exchange transactions investigated by BoZ? Can BoZ tell us what they have done about it? Or have they grown cold feet and closed the chapter?" Chiluba asked.

He said one of his great concerns and embarrassing encounters with Mahtani was that Mahtani developed a habit of making himself part of government delegations when he (Chiluba) travelled abroad.

"He either travelled ahead or booked himself on the same flight and even booked himself in the same hotel. He did so many times in Europe and Africa as ministers and other officials in the presidential delegation can testify," Chiluba said. "Rumour has it that he does it even today and even pretends to be attending the U.N. General Assembly. I warned President Mwanawasa about that in 2002. There is nothing personal about this as any such behaviour and conduct can tarnish the image of a serious leader and government. I decided to terminate my relationship."

On the Carlington maize deal, Chiluba said it was something he could frankly told the nation that it annoyed him.

"Because when Dr Mahtani went to Canada, he presented himself to Carlington Sales as economic advisor to Dr Chiluba and they gave him that contract," he said. "But when the maize was being exported into Zambia the profit margin added on was going to make it difficult for the ordinary Zambians to buy mealie-meal. The profit was going to Dr. Mahtani and the hunger would remain in our houses. I decided no, I come from a poor family. So I called for a meeting and cancelled the deal."

Chiluba said when it was found out that the deal between government and Carlington Sales was not properly executed, the matter was taken to the London Court of Arbitration.

"The Carlington maize deal is one such thing that did not bring quite joy," he said.
On Dr Kaunda's claims that he went as far as to ask the Malawian government to receive US $600,000 from him in order to use it after he exiled him to that country, Chiluba said he did not remember offering some money to Muluzi's government.

"I do not remember sending any cheque or credit cards to Dr Muluzi worth 600, 000 dollars because that could have been cheap to buy any government," Chiluba said. "May be Dr Kaunda knows more...did he mention any minister who carried the money? Because that is extremely cheap."

On Dr Kaunda's son, Wezi's, assassination Chiluba challenged Dr Kaunda to produce any report that linked him to Wezi's death.

On Mahtani's incarceration in 1998 and his claims that he (Chiluba) was a bitter and vindictive man and who abused his office to detain him for no reason at all, Chiluba said this was a matter for the intelligence to explain.

"All I can say is that there was a military coup in 1997 and some of the people arrested and charged were convicted. But if in the process others were wrongfully detained, they were either released or won their habeas corpus in courts of law," Chiluba said.

"This law has been there for years even in the one party state although it was reportedly abused. Even in the alleged coup involving General Tembo himself and others, this law was used and the President as a person did not have to explain the details when the cases were on and after. So one does not have to be simplistic about such matters. Those who were released were paid for wrongful detention."

Chiluba wondered why Mahtani failed to accuse Dr Kaunda of vindictiveness since he too arrested him. He challenged Mahtani to confirm whether his forgiving him over his arrest was highly compensated in an out of court settlement.

"Is it true that Dr Mahtani was paid K61 Billion, perhaps K59 Billion or was it K9 Billion? What kind of forgiveness was it?" Chiluba asked.

Chiluba further challenged Mahtani to tell the nation which governor of the Bank of Zambia restored him to the chairmanship of Finance Bank.

"I recall that because of serious allegations regarding the operations of Finance Bank in Zambia, the Bank of Zambia opted to restructure the Bank as closing it altogether was going to throw Zambians out of employment. BoZ removed him from the chairmanship of the Board and alderman Tom Mtine was appointed interim chairman until the matter was resolved. But soon after I left office, Dr Mahtani was reinstated or 'restored' as Executive Board Chairman of a bank that was under scrutiny. Can the Bank or the government explain this matter. Was Dr Mahtani restored by the Bank Governor, Minister of Finance or President Mwanawasa? Who restored our brother?" Chiluba asked.

He said government could not be seen to be promoting the dominance of one institution such as the Finance Bank, which was a private bank to give it comparative advantage in the market to other banks.

"What makes this even more dubious is the removal or transfer of government accounts from a parastatal bank, ZANACO, to Finance Bank, owned by private individuals with no government stake in it," Chiluba said. "Dr. Mahtani claims he wins these bids fairly without government collusion.

That is utter nonsense. What comparative advantages can Finance Bank which was only recently restructured have over other banks such as Standard Chartered Bank established in 1910, Barclays Bank, Citi Bank, Stanbic Bank, ZANACO, Indo-Zambia Bank, African Banking Corporation, Investrust Bank, First Alliance and Intermarket Banking Corporation? Because of the trillions of Kwacha Finance Bank keeps for ZRA and Ministry of Home Affairs at border posts, is it not fair to give other banks business?"

Chiluba wondered what better incentives could Finance Bank offer, to be the only bank managing public funds in holding; The Rural Electrification Fund, Rural Development Fund, Road Development Fund, Food Reserve Agency (FRA) Finance Facility and The Irrigation Fund.

"I hear even our Parliament has fallen victim to the power of corruption. The National Assembly allowances for our MPs are with Finance Bank. These amounts run into trillions of Kwachas," he said.

Chiluba said it was a very dangerous trend for any government to trust one bank whose exact ownership was reportedly changing and was yet to be verified.

"According to my search at the Patents and Companies Registration, Finance Bank as at 23rd September 1987 was owned by the following shareholders: Finsbury Ltd, a Zambian company owned by Mahtani's sister Mary and her husband Schultz, Job Albert Samuel, a Canadian, Pat Bwalya Puta, nationality unknown and Patrick Chamunda a Zambian," Chiluba said. "And yet other records as at 31st December 2006 show the following as share holders;

"Jonas Strolzfus a foreigner, Finsbury Investments Ltd, Yousuf Bazian, a foreigner, Samuel J A Thiagaraj a foreigner, Justin Chinyanta, a Zambian, Estate of the late Pat Bwalya Puta, Putrick chamunda - a Zambian."

He wondered why Mahtani claimed ownership of Finance Bank when his name did not appear on the list of shareholders.

"So who owns Finance Bank? But if the current shareholding structure is correct, isn't Finance Bank foreign owned? So the question is: Who receives dividends when they are declared every year and what is the role of Finsbury Real Estates owned by Mahtani's sister Mary and her husband Gabriel Schultz in payment of dividends to shareholder?" he asked.

Chiluba challenged the government to explain the business sense behind depriving a parastatal company, Zambia State Insurance of its business and transfer to the private owned Professional Insurance, which according to records was owned by foreign and local companies.

He said Mahtani's explanation that his companies fairly win all businesses through tender procedures was untenable.

"The truth is that other companies and banks consider it a waste of time to compete with Mahtani as they consider him and his companies highly favoured by government," Chiluba said. "They feel cheated and stay away from bidding for any supply of goods and services when tenders are floated as it is unwise to legitimize a "fait accomplice. Mahtani would and will certainly win so why must they legitimise corruption and give it a good name?"

Chiluba said it was his duty as a citizen to protest even vehemently especially when dealing with a government that had zero tolerance to corruption.

Chiluba wondered why Mahtani's owned company Zambezi Portland Cement factory in Ndola had already been awarded a multi-million dollar tender by ZESCO to supply cement for major rehabilitation and expansion works at three hydro electric power stations at Kafue Gorge Complex, Kariba North Bank and Victoria Falls Power Plant, even though the plant was still under construction.

"Only Dr Mahtani and his institutions can defy government regulations and procedures with impunity and go scot-free. When they applied to the environmental Council of Zambia (ECZ)on the impact assessment of running the company, ECZ rejected the impact assessment study they submitted, but eventually the Council caved in. Absolute advantage or is it pressure from government?" Chiluba asked.

"How can a company whose plant will not be ready until after 2008 win a huge tender for the supply of millions of dollars worth of cement, beating Chilanga Cement now known as Lafarge which is in existence?

How in the world can you call that fair? Was not that another fait accomplice? And what about President Mwanawasa, is he aware of these sad facts or not? And now that you are aware Mr President what are you going to do about this and many others mentioned and others yet to come? The buck stops at your doorstep but please know that we know."

Chiluba said it was not acceptable for government to go half heartedly to persuade the Chinese investors to keep Mulungushi Textiles open while they showed reluctance.
"That is bad quid-pro-quo. Who would enjoy playing or watching soccer when their kith and kin are out of jobs and lying half nourished?" asked Chiluba.

But when contacted for comment, Mahtani said: "I am delighted at the contents of Dr F.J.T. Chiluba's press conference, particularly in respect of the issues relating to me personally and indeed the companies I am attached to.

I can confirm that his allegations are totally baseless, disjointed, vindictive, malicious and prove that for as long as he is given a 'platform' or 'podium', nothing good will come out of his utterances! I am convinced now that Dr Chiluba is sick and request all Christians to pray for his good health to enable him face the courts when these matters are brought before them.

"I have consequently appointed a team of attorneys consisting of Mr Steven Malama, Dr. J. B. Sakala and Mr Michael Mundashi to institute proceedings .

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