KCM DEMANDS FOR MORE THAN 59 MILLION UNITED STATES DOLLARS FROM MILINGO LUNGU ILLEGALLY OBTAINED
LUSAKA – 29.07.22
Former KCM provisional liquidator Milingo Lungu has been asked to pay back more than 59 million United States dollars within 3 business days being money he illegally paid himself during the period he served as the provisional liquidator for mining giant KCM.
This is according to a letter of demand issued by Malambo and Company as well as Musa Dudhia and Company representing KCM provisional liquidator Celine Nair addressed to Lusenga Mulongoti Advocates acting as lawyers for Mr Milingo Lungu.
According to the letter of claim deposited in the civil jurisdiction of the Lusaka High Court,KCM limited (in liquidation) as the plaintif has sued Mr Milingo Lungu as the first defendant and Lungu Simwanza and Company as the 2nd defendant.
Mr. Lungu in his capacity as the provisional liquidator without permission of the court or Committee of inspectors did transfer surface rights of Lot number 694/M to Mimbula Minerals Limited at a cost of 20 million United States dollars.
The former provisional liquidator is further alleged in the letter of claim to have without authority of the Court or Committee of inspectors transfered surface rights to subdivision P1 of farm number 1452 and farm number 928 to Sensele enterprises limited at the cost of two hundred thousand United States dollars contrary to legal advise that the transfer would adversely affect the operations of KCM.
He is further said to have paid a total of $ 29,154,319.44 as legal fees to Lungu Simwanza and Company when no such services were rendered to the plaintif while several suppliers introduced to the plaintif by the 1st defendant were paid with no corresponding services and goods rendered.
Ms Nair in her capacity as the acting receiver and official provisional liquidator has since demanded that the 1st and 2nd defendants refund the $ 59,336,903 and $ 29,154,319.44 respectively being the money obtained illegally and without corresponding services to the plaintif.
He is further said to have restructured the plaintif Company into KCM smelter Company Limited and Konkola Mineral Resources without the authority of the Court or Committee of inspections leading to the declaration of 5,558 workers redundant.
The letter of claim further indicates that the provisional liquidator without authority and in total disregard for the order of preference provided in the corporate Insolvency Act paid redundancy benefits in full to all the 5,558 employees in the total sum of $ 103,766,949 instead of $ 6,588,119 as preferential claim leading to financial stress on the plaintif.
“Kindly be advised that if you fail to comply with our legal demands,we have instructions to seek recourse available under law without further notice to your client”, read the letter of demand.
