An Investigative Feature by Zambians Against Corruption

Rajan Mahtani: Zambia’s ‘Gangster Banker’

Faces the Music

DECADES OF DECEPTION• On June 2, 2015, the controversial ‘gangster

banker’ Rajan Mahtani was finally arrested by the Zambian Police on two counts of forgery. But his list of alleged crimes goes back much further.

• As the Chairman of Finance Bank of Zambia, is widely known as one of the most corrupt forces destroying the economic potential of the country. Mahtani has an unfortunate and sordid history of stealing from legitimate business owners through dirty tactics such as forgery, deception, bribery, back-room negotiating with political influencers and other untoward means to institutions critical to the functioning of the Zambian economy.

“Laughing all the way to the bank”• An example of Rajan Mahtani’s criminal dealings

undertaken to buttress his own legitimacy include BRIBERY of former Malawi president Joyce Banda, promising to build a $150-million biothermal energy plant in a bid to regain his banking license, which was withdrawn 10 years prior to the proposition after accusations of money laundering.

• Mahtani also allegedly said he promised Banda he would broker a loan for her government from the Swiss bank Credit Suisse. A media report at the time claimed he offered Banda a $30-million loan to buy maize and fuel.

• Earlier, Mahtani’s image took a further SADC battering in 2005 when the government of then president Bingu wa Mutharika revoked the licence of his Finance Bank of Malawi (FBM) after the Reserve Bank found it was involved in money laundering.

CREDIT SUISSE CONTROVERSY • The recent (and many believe overdue) arrest of the embattled

Zambian businessman Rajan Mahtani on two counts of criminal forgery has sent a shock wave across the local business community, but there is also an international dimension to the scandal as all eyes are on what will happen next to Mahtani’s Finance Bank of Zambia Limited (FBZL).

• In the days following his arrest, Mahtani resigned from the chairmanship of Finance Bank and appointed an interim chairman. Now, according to sources with knowledge of operations at the Bank, it appears that Mahtani’s resignation was demanded by the international banking giant Credit Suisse, which is believed to own a 15% “stake” in Finance Bank, after they reduced from their 40% shareholding earlier this year.

• Jobs at Stake - More than 600 employees at the 34 branches and 16 agencies of Finance Bank across Zambia may be worried for their jobs as Credit Suisse appears to be considering a complete divorce from the banker facing criminal charges.

‘DESPERATE’ TACTICS• In an effort to perpetuate fabricating information to the public in

order to restore his image and, Mr. Mahtani often engages in desperate attempts to mislead.

• One recent instance involves an attempt to confuse domestic and global stakeholders regarding Zambezi Portland Cement and claims of ‘laying off employees and demanding pay cuts’.

• As always, these claims could not be substantiated and were immediately refuted, both by management and employees at Zambezi Portland Cement.

THE BURNING QUESTIONS MAHTANI REFUSES TO ANSWER• Indeed, over the years Mahtani’s name has become duplicitous

amongst the business community in Zambia for his allegedly corrupt practices. And there are questions that exist as outliers:

• Does he own two passports (which is strictly illegal under Zambian law)?

• Does Mahtani own the controlling interests in both Finsbury Investments as well as Clarkwell Ltd? If so, isn’t his shareholding in Finance Bank completely illegal and above the 25% as mandated by law?

• What was Mahtani's role in the control of the Receiver appointed by PTA Bank over Zambezi Portland Cement Limited? What instructions were given by Mahtani to the Receiver of ZPC limited and in what capacities?

• We at Zambians Against Corruption can only hope that his fortunes change with a refreshed outlook on best practices in business and in the interim, corporations with vested interests in Zambia avoid such relationships with corrupt businessmen.