SALIMA SUGAR EX_CHAIRPERSON ARRESTED FOR MONEY LAUNDERING

BY PIJ REPORTER

According to confirmed reports from the Police, it has been discovered that Betgiri, in collaboration with a business associate, established a clandestine bank account in Dubai under the name of Salima Sugar Company. 

Betgiri, who holds a majority shareholding in Salima Sugar through his companies Aum Sugar Allied Ltd and Mothers Dairy and Energy Farms Limited, now finds himself in the eye of a legal storm.

Police spokesman Peter Kalaya shed light on the arrest, stating that Betgiri, aged 67, was taken into custody on Wednesday evening and is currently remanded at Lumbadzi Police Station in Lilongwe.

He faces four grave charges: fraud other than false pretences, obtaining execution of a security by false pretence, trustees fraudulently disposing of trust property and money laundering.

The investigation has revealed shocking details regarding Betgiri’s alleged illicit activities. Authorities suspect that he masterminded the opening of another company in Dubai, United Arab Emirates, cleverly named Salima Sugar Company, to further his fraudulent schemes.

By utilising assets and property belonging to the Malawian company, Betgiri allegedly obtained a staggering loan amounting to $300 million (equivalent to approximately K3 billion).

Disturbingly, the evidence points towards the loan being used as a front for extensive money laundering activities. These activities’ exact nature and extent are still under investigation, and authorities have promised to release further information as the case unfolds.

Wapona Kita, Betgiri’s legal representative, confirmed his client’s arrest. Although he offered only a brief response, stating: “We are working on it.”

Betgiri (C) in a meeting at Salima Sugar Company

Betgiri & Son Under MRA Radar

The arrest comes just a month after Betgiri and his son Bruhat Betgiri were apprehended by the Malawi Revenue Authority (MRA) on allegations of financial theft from the company. They are suspected of systematically syphoning off substantial sums of money from the company, undermining the government and other investors while selfishly pursuing personal gain.

In addition to these shocking allegations, Betgiri is also under scrutiny for his involvement in borrowing K4 billion, which he allegedly invested in Salima Sugar Company as equity. However, investigations have revealed that Betgiri may have abused his position as a shareholder, taking out exorbitant loans with interest rates reaching up to 23 per cent. What makes matters worse is that these loans were repaid using company funds, further exacerbating the financial irregularities and raising serious concerns about Betgiri’s accountability as a business leader.

These revelations have sent shockwaves through the Malawi business community and have put a spotlight on the government’s laws on shareholdership. These laws promote transparency and accountability in business dealings, ensuring that individuals like Betgiri are held responsible for their actions.

Through Attorney General Thabo Chakaka-Nyirenda, the Malawian government has taken a keen interest in the case and has applied to join the ongoing legal proceedings as a minority shareholder with a 40 per cent stake in Salima Sugar Company.

The ramifications of Betgiri’s actions extend beyond the borders of Malawi. Betgiri is entangled in a complex legal dispute in a separate court battle with his former business partner and fellow Indian national, Ramesh Jashmani. The dispute centres around a substantial debt of $2.62 million, secured against Betgiri’s Salima Sugar Company shares, and was originally due for repayment by December 2022.

ANOTHER COURT CASE PENDING

The Commercial Division of the High Court has been inundated with court documents outlining the case, revealing that Betgiri and his MDE Farms had pledged all their shares in AUM Sugar and Allied Limited. This company, in turn, held a majority stake in Salima Sugar Company.

Jashmani claims ownership of the AUM Sugar shares in Salima Sugar Company, alleging that Betgiri failed to honour the agreed-upon repayment agreement. In another legal battle, Mother’s Dairy and Energy Farms Limited filed a claim against AUM Sugar and Allied Limited and Prashant Sharma for removing Betgiri from the board of directors of Salima Sugar Company Limited. Betgiri swiftly obtained a court order in April to prevent his removal, but the defendants are fighting to vacate the injunction.

The intricate web of legal battles and financial improprieties surrounding Betgiri has cast a dark cloud over Salima Sugar Company and its stakeholders. The Malawi Government’s interest in the case is not only fueled by their minority stake but also by the repayment of a loan they invested in the sugar company.

Records from the Reserve Bank of Malawi indicate that AUM Sugar and Allied Limited contributed a substantial $6.8 million towards the company’s share capital. Furthermore, the Malawi Government has guaranteed several loans obtained by the company from CDH Investment Bank Limited, totalling $25 million, underscoring the significant stakes involved in resolving these intricate legal and financial disputes.

As the legal proceedings progress and more details emerge, the business community and the public anxiously await the resolution of this complex case. The outcome will not only determine the fate of Salima Sugar Company but also serve as a critical precedent for upholding the principles of transparency, accountability, and integrity in the Malawian business landscape.