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If AZADI and Zamworth are one company, then Chitotela’s house is dirty

GOVERNANCE campaigner Rueben Lifuka says those involved in the AZADI, Zamworth and Ministry of Infrastructure construction scandal must be prosecuted. The vice president of Transparency International was commenting on a News Diggers investigation that revealed irregularities in the government’s $5.35 million purchase contract with construction company ZAMWORTH for an office building.

LIFUKA: “The Auditor General’s report already provides sufficient grounds for all those involved in the sham deal to be investigated and, if appropriate, prosecuted for their acts of commission. The value of the acquired property remains debatable and there is reason to conclude that the Zambian government, through the then Ministry of Infrastructure, knowingly and willfully paid an exorbitant amount for the property. On November 18, 2016, the Government Valuation Department recommended a market value of K19,327,000 (US$1,958,156.03 at 9.87K on the dollar), but the Ministry of Infrastructure, under circumstances that were not explained, did not adhere to the recommendation. This begs the question, where does the valuation of US$5.3 million come from? Another point of contention that requires a clear explanation from those in power is the payment of property transfer tax. The Zambian government paid K5,350,000 in Property Transfer Tax as the purchaser of the property and not Zamworth Ltd as the seller, contrary to the provisions of the Property Transfer Tax Act. This therefore means that the Zambian government paid K61,565,386, equivalent to US$5.3 million, and also paid K5,350,000 as property transfer tax, bringing the total to this property at K66,915,386. The conduct of the former Attorney General should be closely scrutinized.

There are many hidden scandals in this developing story. At this point, many of our fellow citizens may not understand the seriousness of the illegalities that have occurred, facilitated by individuals who are sworn to uphold the laws of this country and protect public resources. There were numerous overpriced contracts that the government under the Patriotic Front signed with private companies, most of which were conduits to divert public resources. But what is causing dust in this particular scandal is the fact that the private company that sold the government a building at too high a price is demanding an additional payment of $25 million in interest, on the grounds that the government was late in paying the principal amount.

But that’s just one of the many questionable problems with this outrageous transaction. Apart from all the points raised by Mr. Lifuka, there is something else that caught our attention, and that concerns the mansion built by the man who was in charge of this ministry at the time of the signing of this agreement. Our investigation revealed that this Zamworth construction company, which is not registered with the National Construction Council, is a sister company to AZADI Investment, the company that built a house for former Housing Minister Ronald Chitotela worth 9.8 million K.

A few weeks ago, when the Anti-Corruption Commission seized the house and arrested Mr. Chitotela, we noticed that he claimed that the house was built for him by a company called AZADI Investment on credit. A quick search for this company brought us to their website where we found a claim that they had built the ministry office building. We published a story to this effect because we found it strange that the company which built a house for the Minister without paying the full cost also claimed to have been behind the construction of a building which is now owned by the government.

As usual, the PF’s chief spin doctor, Mr. Emmanuel Mwamba, took to Facebook to discredit our information as a “punka story”. Mr. Mwamba even went so far as to call us and tell us to stop publishing lies. According to him, there was no link between the company that built the house of the former minister and the government. Mr. Mwamba was very confident when he spoke to us, but there were questions we asked him that he could not answer.

Today News Diggers has established that in fact Zamworth, the company which sold the building to the government and AZADI Investment, the company which built a mansion for Mr Chitotela in Nkongole are in fact sister companies operating out of from the same premises. We were able to establish that the owner of AZADI Investment, Mr. Yunus Konuk, is also the man in charge of commercial and financial transactions at Zamworth. We were able to establish that part of the money that Mr. Chitotela’s ministry paid to Zamworth went to AZADI and this Turkish businessman named Konuk. One wonders what Mr Emmanuel Mwamba, the chief spin doctor, has to say about these facts.

But what does this connection tell us about the rest of the story? Since Mr. Mwamba had challenged us to ignore what was claimed on the websites and look for facts instead, we wrote a press query to Mr. Konuk of AZADI Investment, asking him to explain the relationship between his company and Zamworth. Most importantly, we asked Mr. Konuk to explain how, a year after his registration with PACRA, his company found it profitable to build a house on credit for a serving minister worth $9.8 million. from K. For us, it didn’t make sense. We asked him to explain if this credit facility was available to any other Zambian wishing to build or if there was something special about Mr Chitotela.

Instead of answering our questions, Mr. Konuk unleashed the lawyers on us with a demand for an apology and a retraction of our publication. We have refused to apologize for publishing what they themselves claimed. We declined to go back on the results of our investigation, as we believe our story was based on facts. We have therefore challenged Mr. Konuk and AZADI Investment to go ahead and serve legal process on us so that we can reveal the rest of what we have collected in this scandal. Our point is that if AZADI and Zamworth are the same company run by the same people, then there is reason to suspect that corruption may have taken place, and someone needs to explain themselves.

To be continued…