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A sophisticated money laundering ring involving Malawian currency has been uncovered that crossed borders and resulted in the confiscation of a large amount of currency in Zambia. Malawian state agencies are now working to recover the seized funds, uncovering a complex network of currency smuggling and potential counterfeiting.
Two weeks ago, the Zambian Drug Enforcement Commission (DEC) arrested two foreign nationals – a Russian and an American – at the Kenneth Kaunda International Airport (KKIA). They were found in possession of a total of K42,184,000 in Malawian Kwacha hidden in eight wooden boxes. The money, mostly in 20 and 50 Kina notes, was to be shipped to the United States via Turkish Airlines.
Further investigations led authorities to a hotel in Lusaka, where more currency was seized.
In an exclusive interview with Nyasa Times, Attorney General Masauko Chamkakala explained that teams from his office, the Reserve Bank of Malawi and the Fiscal Police Service travelled to Zambia last week to meet with their Zambian counterparts to learn about the bust.
“We found that in 2022, someone abandoned K840,000 in small denomination notes at a hotel in Lusaka. Earlier this year, another person was stopped at the Mwami border with a large amount of small denomination Malawian Kwacha and another was caught at the Chipata border with K76 million in small denomination notes,” said Chamukakala. This suggests that the recent bust is part of a larger syndicate that has been going on for some time.
The operation required coordination among multiple Zambian agencies including the Zambia Environmental Protection Agency, the Zambia Police Service and the National Prosecuting Authority, highlighting the sophistication and reach of this criminal group.
Elaborating on the collaborative efforts, the DPP said: “I can confirm that we went to Zambia and met with officials from the Bank of Zambia, the Zambia Police Service, the DEC and the National Prosecuting Authority. We want to understand the whole issue and develop a clear solution.”
Chamukakara noted that the prevailing theory is that the Malawian currency, especially the 20 and 50 Kina notes, was recycled to print a stronger currency.
“The security paper these notes are printed on is almost impossible to find. We suspect these individuals have the technology to remove the printing and reprint it with higher denomination notes. The $20 and $50 notes are likely to be in high demand as they are the same size and colour as some global currencies such as the Canadian dollar,” he said.
The DPP stressed that Malawian authorities are working with Zambian officials to recover the funds and are considering seeking help from the U.S. government to determine the intended use of the funds in the U.S. However, bringing the criminals to Malawi to face trial is a daunting challenge.
“There are several technicalities. First, the crimes we are charging them with here do not constitute crimes in Zambia. Unfortunately, the extradition law requires both countries to recognize those crimes. Possession of foreign currency is not a crime in Zambia. But we will continue to hold meetings with our Zambian counterparts to explore other possibilities,” he said.
The recent arrests and discoveries have set in motion a wider investigation into smuggling and money laundering operations.
Chamkakala stressed the importance of the effort, noting that it is crucial to understand the full scope of the network and its operations. “We are dealing with a well-organized group that has been exploiting legal and logistical loopholes to move large amounts of money across borders. Our goal is to disrupt this operation and ensure those responsible are held accountable,” he said.
He noted that investigations were ongoing and both Malawian and Zambian authorities were committed to fully uncovering the true face of the criminal group.
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