A MYSTERIOUS MAURITIUS FIRM IS PAID BILLIONS. NO TENDER. NO PPDA APPROVAL.

BY PIJ REPORTER

BIG PICTURE

Mauritius is widely recognized as a tax haven. This means that businesses worldwide establish offices there to benefit from favourable tax conditions. However, this practice sometimes attracts unscrupulous businessmen who set up shell companies, aiming to conceal the identities of the true owners.

Egenco, tasked with tackling Malawi’s electricity challenges, has struggled with inefficiencies inherited from its days as part of the state-owned Escom. Although restructuring was intended to enhance its procurement system, violations of procurement rules continue, leading to mismanagement and waste. Notably, Egenco controversially selected a Mauritius-based company as its sole supplier in a curious case of single-source procurement.

FINDINGS

Teligenta, based in Mauritius, received $4,666,357 (approximately MK3,483,577,105) for allegedly supplying spare parts to the Kapichira power station under a single-source agreement. These contracts should have received approval from the Public Procurement and Disposal Authority (PPDA), but this step was skipped. Furthermore, in some instances, the contracts required, but did not receive, clearance from the Anti-Corruption Bureau (ACB) and bypassed the Internal Procurement and Disposal Committee (IPDC).

Payments to the company commenced in 2019, with the most recent transactions occurring in 2021. However, none of the procurements involving the company were processed through the Public Procurement and Disposal Authority (PPDA), and due diligence was only conducted in 2022—four years after the initial contract was awarded.

A leaked internal audit report on EGENCO’s transactions has been circulated among several media outlets, including the Platform for Investigative Journalism (PIJ), sparking continuous coverage. The payments to Teligenta have come under scrutiny, raising significant concerns about their legitimacy. The auditors reported a lack of competitive bidding, absent contracts for some supplied goods, and, in some instances, no evidence that the goods paid for were actually supplied.

A search by the Platform for Investigative Journalism (PIJ) on Open Corporates—an open-source corporate database—revealed minimal information about Teligenta. The company was established on April 10, 2018, less than a year before EGENCO began payments without conducting due diligence. Its registered office is at Suite 201/2 A, 2nd Floor, 1 Cyber City, Ebene, Mauritius, but the database does not disclose its owners or shareholders. Further attempts to locate Teligenta’s website were unsuccessful.

In some instances, delivery notes and certificates from the Malawi Revenue Authority (MRA) for payments made by EGENCO to Teligenta cannot be traced. This lack of documentation raises serious questions about whether the alleged goods were delivered at all.

“We did not find evidence that EGENCO had a number of competing suppliers from which Teligenta was selected as a successful supplier before going into a single source framework agreement with it in the first place, according to the PPDA Act (2017) requirement. Although EGENCO cited “urgency” as the reason for entering into the single source framework agreement with Teligenta, it was more on restricting competition than fulfilling the “urgency” because the Kapichira power plant has been there since the year 2000 (under ESCOM, of course) and has always procured spare parts from other suppliers. 

“It could not be that “old” suppliers suddenly failed to meet the “urgency” criteria. c) Additionally, we noted that as part of its due diligence exercise, EGENCO only obtained a confirmation from the Directors of Teligenta Limited on 19th February 2022, yet they started offering it contracts in 2019, four years earlier,” reads an audit report by the company’s auditors. 

Auditors have flagged Teligenta as a peculiar entity; despite engaging in high-value transactions with EGENCO, it reportedly has only one director, identified as A. Azees. Established in Mauritius on April 10, 2018, Teligenta conducted business with EGENCO from March 2019 through November 2021. Additional internet searches reveal that Teligenta does not appear on the list of companies operating from its registered address at Suite 201/202A, 2nd Floor, Cyber City, Ebene, Mauritius, as indicated on its Confirmation of Directors letter.

“We made a telephone call to the company’s offices in Mauritius using the numbers on the invoices to make some enquiries, but the line was immediately cut after our introduction.” 

The first recorded payment to Teligenta was made on September 11, 2019, amounting to $371,650 (approximately MK275,021,000). The payment, for goods supplied from South Africa to Blantyre, was processed through a swift payment by FDH Bank to Teligenta’s account in Mauritius. EGENCO’s Acting Director of Finance, Delano Ulanje, approved the transaction, which was authorized by the company’s Director of Operations, Rex Muhome.

The contract between EGENCO and Teligenta was signed on July 9, 2019. EGENCO’s then CEO, William Liabunya, and Videlia Mluwira represented EGENCO, while A. Azees and Syed Hassan signed on behalf of Teligenta.

A subsequent payment of $558,430 (approximately MK413,377,807.50) followed, for goods supplied from South Africa to Blantyre. The payment for invoice number TG-115 was processed via swift transfer by National Bank to Mauritius, approved by EGENCO’s Deputy Director of Finance, Orphan Chisasa, and authorized by the CEO under contract EGC 349/SS/G/FY18-19. Notably, while this invoice was signed off by Teligenta representatives A. Azees and Syed Hassan, no EGENCO representatives signed the invoice.

On November 24, 2021, EGENCO made a payment of $145,110.00 (approximately MK119,570,640.00) under contract number EGC 247/SS/G/FY 2020-2021 for the supply and delivery of dredger spare parts to Nkula Power Station. Notably, this payment was processed without the signatures of any Teligenta representatives or witnesses.

On July 12, 2021, EGENCO’s then Chief Executive Officer William Liabunya and Mrs. Videlia Mluwira signed a contract under Invoice number TG-189, dated June 3, 2021. The payment was made to Teligenta Mauritius via swift payment through National Bank, approved by Director of Finance Hilda Singo and authorized by CEO Mr. William Liabunya. Notably, there was no requisition order on file for this transaction.

On February 17, 2020, EGENCO made a payment of $655,490.00 (approximately MK487,684,560.00) for goods supplied from South Africa to Blantyre. This payment covered various documents associated with the transaction, including Townlink Freight Clearing Company’s invoice, release order 2020 R878, an airway bill from South African Airways number 1234, a packing list, commercial invoice TG134, and a Malawi Revenue Authority customs and excise declaration form 12 with manifest number 2020 6.

Notably, all these documents were photocopied, and no requisition order or goods received note was on file. The payment was processed through a swift payment to Teligenta Mauritius by National Bank, approved by EGENCO’s Acting Director of Finance Delano Ulanje and authorized by then CEO William Liabunya.

On August 28, 2020, EGENCO made a payment of $39,500.00 (approximately MK30,020,000.00) to Teligenta Limited Mauritius for a twin disc clutch system for the Kapichira project, under invoice TG141. This transaction was processed through a swift payment by National Bank, based solely on a bank letter approved by Hilda Singo, the Director of Finance, and authorized by the Chief Executive Officer. Significantly, the payment was made without any supporting documentation such as a contract, invoice, Malawi Revenue Authority customs & excise duty declaration form 12, release order, packing list, arrival advice, or goods received note.

The Anti-Corruption Bureau (ACB) has not yet responded to inquiries regarding the payments made to the company. These questions include whether the nature of the payments requires ACB approval, or if the circumstances surrounding them warrant an investigation into potential legal violations.

The PPDA, through a spokesperson, confirmed in a written response to the PIJ that the authority has never processed any procurement material involving Teligenta.

“No Objection from PDEs are submitted to the Authority for payment. In view of this, the authority has never processed a request for EGENCO to make payments to a supplier you have mentioned,” reads part of response by PPDA Public Relations and Communications Manager Kate Kujaliwa.