THE Financial Intelligence Centre (FIC) report has disclosed that government under the PF administration paid over K75 million to a company contracted for major infrastructure projects which did not do the work.
The report details how Company D was awarded a contract worth K350 million in 2019 by a public institution for infrastructure development.
The contract was supposed to run for 18 months.
However, despite receiving a down payment of K75 million, verifications found no proof that any construction or related work took place.
Company D also subcontracted 10 local companies to carry out ancillary works and these subcontractors were paid more than K10 million by the public institution.
Yet, just like Company D, these companies reportedly did not execute the assigned work.
Company D was later awarded a second contract worth K45 million in a different part of the country and this contract also remained unfulfilled, with no evidence of completed work.
The Financial Intelligence Centre has forwarded the case to law enforcement agencies for investigations on suspected corruption and money laundering.
“The case was disseminated to the relevant LEAs on suspected corruption and money laundering. The case was under investigations,” read the report.
In a separate but related case, the FIC uncovered a complex web of financial transfers involving Company ZO, a foreign-based company that received government contracts beginning in 2016.
The company had links to a local entity referred to as Company G, owned by individuals identified as Directors CZ and EZ.
Between 2016 and 2019, Company ZO received a total of US$43 million from the Zambian government.
However, analysis showed that between 2018 and 2019, the company transferred more than US$100 million to four subsidiaries of Company G, namely Company KH, ET, SC, and SM.
These transfers significantly exceeded the amount paid by government and raised suspicions of illicit financial flows.
The breakdown of some of the key transfers included US$11 million to Company KH, US$14.2 million to Company ET, US$4 million to Company SC and US$14.4 million to Company SM.
From these amounts, over US$24 million was either withdrawn in cash or transferred directly to the personal accounts of Directors CZ and EZ.
Investigators also uncovered a US$113,000 transfer from Company ET to a Prominent Influential Person (PIP) for the acquisition of a farm.
Additionally, Company ET made a US$850,000 payment to a luxury accommodation facility owned by another PIP.
A further US$2 million was transferred to an associate company that invested the funds in real estate, also ultimately benefiting a PIP.
It was also discovered that Company G and its subsidiaries were not tax compliant.
As a result, a financial institution de-risked them in 2020 and closed their bank accounts.
The matter was subsequently referred to law enforcement agencies for investigation on suspected tax evasion, corrupt practices, and money laundering.
The case proceeded to court, and in 2024, assets valued at USD 2.5 million were forfeited to the state.
By Catherine Pule
Kalemba, July 28, 2025
