First Capital Bank Being Investigated By Central Bank:CEO Hitesh In Serious Corruption Scandal
The Newly branded FIRST CAPITAL BANK formerly First Merchant Bank is being investigated by the Central Bank in Lilongwe because of its role during the sale of TNM shares in 2010 and other transactions by Press corporation.
The bank has been found on the firing range after its Executive Chair Hitesh Anadikati was involved in serious corruption with the late Dr Matthews Chikaonda who was the CEO of Press Corporation. The Central Bank has been forced to start investigations after USAID regional office made a request since it had funded a group in SOUTH Africa to procure the shares.
However, the funds were mismanaged through shareholders disagreements. And the bank then First Merchant Bank was informed to hold the funds and they defied a court order that was issued by the High Court in Blantyre. Now USAID is looking for their funds and have used Diplomatic channels. The legal team for USAID is pushing for the licence to be revoked since the bank was involved in nefarious activities which the licence Clearly indicates that any holder involved in such should have their licence revoked and the holders prosecuted by the court of law.
“MR ANADIKATI was forced to change the name because of this. However, the situation is worse since late Chikaonda is no more. If anything the TNM shares scandal will only be answered by the owner of the bank. Again the client base will soon be affected since there is going to be massive withdraws once the story leak to the public,” said a bank officer privy to the issue.
Other than the TNM shareholders matter, First Capital Bank was at the center of acquisitions of shares in MTL and there was no transparency in the way the shares were sold. As of now Anadikati is pushing the blame to a Mr Sean O Neil who was at the center of it all as a financial consultant.
Next month there is a shareholders summit conference and Mr Anadikati is trying to pleading with Central Bank sources to hold investigations until October to pave way for new investors. He has even attempted to use political forces to get his way through.
The Bankers Association of Malawi has been approached by some investors to assist with a due diligence process and the issue is coming up and the rusty hands of Mr Anadikati are emerging. Although this was one of the first private banks in the country, issues of compliance and ethics seems to have derailed.
Fiscal Police, FIU and the ACB are also involved in the investigations and people are using the bank at owners risk.