Mulli seeks K2.1 billion in damages from audit firm over RBM report

Mulli seeks K2.1 billion in damages from audit firm over RBM report
Mulli seeks K2.1 billion in damages from audit firm over RBM report

Africa-PressMalawi. Mulli Brothers Limited (MBL) is seeking K2.1 billion compensation from Deloitte & Touche Services Limited, saying the audit firm defamed the company in a forensic audit report for the Reserve Bank of Malawi (RBM).

In the report released this year, Mulli Brothers was mentioned as one of the companies that benefited from questionable payments at (RBM) between January 1, 2019 and June 30, 2020.

Deloitte reportedly claimed that Mulli Brothers and Jean Mathanga, wife to former RBM deputy governor, were benefitting from hefty loans from the Central Bank for their businesses.

“The Defendant proceeded to state that: ‘…The Mulli Brothers and Jean Mathanga (the wife to RBM Executive Director) were benefiting from hefty loans from RBM for their businesses. The Mulli’s and Mathanga’s were paid money four times for the Farm Input Subsidy Program (FISP) and payments were made before the contracts were awarded to other suppliers,” reads part of the summons filed Mulli’s lawyers, Ritz Attorney at Law, and dated September 2.

The lawyers have argued that the Forensic Audit Report, in the allegations against Mulli Brothers, breached International Standards of Auditing and is not credible.

“Our client’s assertion is that no interviews were at any point conducted and is of the strong view that the report falls below applicable standards. Our client is of further view that there was lack of appreciation of salient issues on how Letters of Credit under the facility worked,” lawyer from Ritz lawyers, John Kalampa, told the local media.

MBL, through the lawyers, is demanding K1.5 billion for loss of business and business value caused by the audit report as well as K200 million for defamation.

The company also wants to be awarded K100 million for false reporting and K100 million for negligent misstatements, representations and misfeasance. Another K100 million is being demanded for professional negligence and an additional K100 million is for malice and/or bad faith.

Meanwhile, Deloitte has been told to challenge the summons or pay the money within 28 days. The company can also inform the court within 14 days if it does not want to challenge the case. However, the court will be forced to enter a judgment if Deloitte does not provide any kind of response.


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