BLANTYRE, Malawi — The Malawi Revenue Authority (MRA) has intensified its crackdown on tax evasion by arresting five senior officials from Mapeto David Whitehead and Sons (DWS) Limited over allegations of tax fraud and tax evasion estimated at K10.8 billion.
Among those arrested are the company’s Managing Director Mohammed Gaffar, Financial Controller Abdul Rashid Bakali, Procurement Manager Yaseen Muhammad, and General Manager Martin Mpata, who were taken into custody on Friday.
The company’s director, Faizal Gaffar Latif, voluntarily surrendered to MRA officials at Msonkho House in Blantyre on Monday in the company of his lawyer, Jai Banda. After being questioned by investigators, he was transferred to Blantyre Police Station where his four colleagues were being held.
According to MRA Head of Corporate Affairs Steve Kapoloma, the arrests follow an extensive six-week investigation conducted after tax officials obtained a search warrant from the Blantyre Magistrate’s Court.Mapeto Tax Evasion Case To Start In March
Kapoloma said investigators uncovered three major forms of alleged tax evasion.
The first allegation involves the under-declaration of sales, where the company is suspected of selling products without fully declaring the transactions to MRA. Authorities say this resulted in reduced payments of Value Added Tax (VAT) and income tax, depriving the government of significant revenue.
The second allegation concerns customs duty evasion. MRA claims the company imported finished products into Malawi but falsely declared them as raw materials, enabling it to pay substantially lower import duties than required under the law.
The third allegation relates to Pay As You Earn (PAYE) tax. Investigators allege that while expatriate employees received their full salaries, the company declared lower taxable incomes to MRA, resulting in reduced income tax payments.
Kapoloma said the findings were based on documents seized during the investigation and that the suspects will appear before court once legal processes are completed.
The five executives remain in police custody pending their court appearance.
Search Warrant and Investigation
The investigation was launched after MRA secured a search warrant authorizing officials to examine the company’s import records involving various goods, including fabrics, accessories, motor vehicle tyres and other imported products.
MRA has indicated that the investigation focuses on suspected offences under the Customs and Excise Act, the Taxation Act and the Value Added Tax Act.
Previous Allegations
The latest developments come weeks after Minister of Foreign Affairs Eisenhower Mkaka filed a defamation lawsuit against two women over Facebook posts alleging that he received K300 million from Faizal Gaffar Latif to shield Mapeto DWS from a separate alleged duty evasion scheme estimated at K22 billion.
Court documents indicate the posts alleged the company smuggled containers of truck tyres disguised as textiles intended for the Malawi Congress Party and bribed the minister to suppress investigations.Faizal Latif of Mapeto implicated in Mera MK300 million saga
Mkaka has strongly denied the allegations and is seeking damages, a public apology, retraction of the statements and legal costs.
Previous Tax Dispute
This is not the first time Mapeto DWS has come under scrutiny by tax authorities.
In August 2019, MRA obtained another search warrant to investigate allegations that the company undervalued imports from China in an attempt to evade customs duties.
At the time, Faizal Gaffar Latif dismissed the allegations, maintaining that the company had no outstanding issues with MRA concerning the valuation of imported tyres.
Court Proceedings Expected
The arrests mark one of the most significant tax enforcement actions undertaken by MRA in recent years. The case is expected to attract widespread public attention as prosecutors prepare formal charges against the company executives.
The suspects remain presumed innocent unless and until proven guilty in a court of law.
