Africa-Press – Malawi. The so-called IMF misreporting case—targeting former top government officials—is increasingly resting on shaky legal ground.
This follows a landmark High Court ruling in favour of former Finance Minister Joseph Mwanamvekha, who successfully petitioned for his discharge from the case. The judgment, delivered on 8 May 2025, not only removed one of the accused from the dock but also cast a long shadow over the prosecution’s overall strategy.
In the matter, some former Reserve Bank of Malawi (RBM) officials are accused of giving wrong information to the IMF in 2018 to create an impression that Malawi Government was meeting conditions for the $108 million Extended Credit Facility (ECF) that was in effect at the time.
Still facing trial are former Reserve Bank of Malawi (RBM) Governor Dalitso Kabambe, his former deputy Henry Mathanga, and ex-Secretary to the Treasury Cliff Kenneth Chiunda. The trio stands accused of three principal offences: conspiracy to expend public funds without Parliamentary authorisation, making misleading statements, and money laundering.
At the centre of the charges is a $350 million facility obtained from the African Export-Import Bank (Afreximbank), which the State alleges was secured and used without Parliament’s knowledge or approval. Additionally, it says the facility was not reporting to the IMF.
However, this narrative has come under serious scrutiny, largely due to key facts laid out in the court’s ruling and the persuasive arguments advanced by Senior Counsel Dr. Kalekeni Kaphale.
In examining the origins of the facility, the Court uncovered a pivotal detail: it was not the accused individuals or the Ministry of Finance, but rather the RBM Board of Directors that formally approved the loan. Minutes from the RBM Board meeting held on 18 December 2018 confirm that the facility was sanctioned to address the country’s foreign exchange needs
“The Board noted that it approved, through a round robin method on 17 December 2018, two facilities between the Bank and African Export-Import Bank (Afreximbank), amounting to USD 350 million… These resources would enable the Bank to adequately accommodate the country’s foreign exchange requirements.”
This undermines the State’s claim that the loan was unlawfully acquired or laundered. Instead, it suggests the transaction was conducted in accordance with internal institutional procedures and within the RBM’s legal mandate.
RBM independence: A potential legal shield?
Justice Kapindu further emphasized the statutory independence of the RBM, as outlined in Section 5 of the RBM Act, which shields the central bank from undue external interference.
“Except as provided by this Act, the Bank, the members of the Board and the staff of the Bank shall be independent, and shall not be subject to direction by any person or authority.”
This provision establishes a legal buffer, complicating efforts to hold external officials criminally liable for actions taken within the RBM’s autonomous remit.
In court, Dr. Kaphale, representing Mwanamvekha, questioned the logic behind prosecuting officials from outside the Bank.
“Are we to believe that a Finance Minister can override the RBM’s legal autonomy? If such influence was exercised, where is the evidence? It does not exist.”
Although Mwanamvekha has now been formally discharged, Kaphale’s arguments have had a lasting impact, exposing potential weaknesses in the prosecution’s case.
Justice Kapindu was also critical of the prosecution’s overall strategy, particularly its reluctance to invoke constitutional provisions for discontinuing proceedings. Citing Section 42(2)(f) of the Constitution, which guarantees a fair trial.
He remarked: “If the prosecution deliberately chooses to forego the constitutional process of discontinuance, and instead chooses to push the Court to invoke a mere statutory power of discharge, then it must face the burden of justification.”
Based on the Court’s findings, the Reserve Bank of Malawi was under no legal obligation to seek Parliamentary approval before securing the Afreximbank facility.
This significantly undermines the State’s position that the Central Bank’s top executives acted unlawfully.
No legal juice in money laundering charge
Perhaps the most troubling concern raised was the nature of the money laundering charge itself. As the judgment highlights, Dr. Kaphale warned that the offence is increasingly being used as a vague and overly broad catch-all.
“The charge of money laundering is, in recent times, increasingly being abusively employed as a sweeping charge without sufficient evidential backing, and the present case is an instance,” he cautioned.
The court ruling also reveals that the Afreximbank funds were domiciled at the RBM and not hidden else where; that the funds were secured procedurally through the Central Bank’s Board approval, effectively undermining the prosecution’s key point of focus.
With Mwanamvekha permanently out of the case and the court openly questioning the legal and procedural foundation of the charges, the landscape of the prosecution has fundamentally shifted.
Although Kabambe, Mathanga, and Chiunda remain on trial, the very arguments that led to Mwanamvekha’s discharge—RBM’s institutional independence, the need for constitutional safeguards, and the prosecution’s burden to present clear and sufficient evidence—may prove to be their strongest defence.
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