BLANTYRE, Malawi: Malawi President Joyce Banda on Thursday (Friday in Manila) dissolved her entire 25-member cabinet in a move a presidential source said was in response to a multimillion-dollar fraud scandal.
The move was announced by Banda’s office, which said she will announce a new cabinet in “due course.”
The treasury and the president’s powerful office have been rocked by a spate of multi-million dollar fraud scandals this year.
“Obviously the sackings have got to do with the ongoing crisis at the treasury,” a source in Banda’s office told Agence France-Presse.
The European Union warned on Thursday that it will not release 29 million euros ($39 million) in scheduled financing to the aid-dependent nation until the government deals with the fraud.
“There is need for a clean-up before we make our disbursement,” Alexander Baum, the head of the EU mission in Malawi, said in a statement.
In one of the biggest fraud cases ever recorded in the country, the principal accountant in Banda’s office authorized payment of one billion kwacha ($3 million) to a ghost firm, according to the state-appointed Anti-Corruption Bureau.
In another case, a junior officer who earns $100 a month was found with $25,000 cash at his house during a raid by the police.
Ten government employees have been arrested over the past two weeks on fraud charges in the so-called Capital Hill cash-gate scandal, named after the seat of government.
Last month, nine senior police officers were jailed for 14 years each for fraud involving $164,000.