LILONGWE (MalawiTalk) – Attorney General Dr Chikosa Silungwe says his office is reviewing a consent order between Democratic Progressive Party (DPP) administration and Mulli Brothers Limited (MBL) Holdings providing settlement of K5 billion debt over a 50-year period.
Silungwe said the court order that facilitated the arrangement, which he described as “ridiculous”, is currently under review.
Said Silungwe: “It’s an unreasonable agreement. It means that it will take Mulli Brothers 50 years to pay back the money. It is a ridiculous order.”
Former chief secretary to the government Mr Lloyd Muhara and then secretary to the Treasury Mr Cliff Chiunda signed on behalf of the Malawi Government while MBL Holdings Limited was represented by its lawyers.
Under the agreement, MBL Holdings was set to be paying a fixed K5 million per month for 50 years to settle the K5 billion owed to the public.
In a separate interview, MSB Debt Collection Company board chairperson Mr Chadwick Mphande confirmed the consent agreement, saying his company has also taken up the matter following the change of government.
He said: “We assigned our lawyer Mr. Alinane Kauka to take action when we realised Mulli would not pay back the money. We threatened to put his company into liquidation.
“Mr. Mulli then went and spoke with the then Chief Secretary [Muhara] and agreed that Mulli should pay the debt in instalments of K5 million until he finishes the whole amount. It meant Mulli would pay that debt over a period of 50 years.”
Mphande said his company has met Minister of Finance Mr Felix Mlusu and the new team at Treasury on the matter.
He said: “We briefed the Minister of Finance [Mlusu] and showed him the agreement and that as a debt company we would not accept that. We were willing to recommend perhaps five-year period of repayment, but not longer than 10 years.”
Since its formation, the loan recovery company has struggled to recover what have come to be known as MSB “toxic assets”.