Donors seek refunds from Zambia farmers' body after fraud revelation

The governments of Sweden and Finland said on Wednesday that they will demand for refunds from a Zambia farmers' association after an audit reveals serious misappropriation of funds.

The two governments said at a joint press briefing that they will seek refunds from the Zambia National Farmers Union (ZNFU) after a second audit of the association revealed glaring misappropriation of donor funds.

"The findings in the report are of serious concern and constitute breach of agreement. As donors we will individually reclaim funds from ZNFU," David Wiking, Head of Bilateral Development Cooperation at the Swedish Embassy in Lusaka told reporters at the press briefing.

According to the audit findings, about 33,944,347 Zambian Kwacha (about 3.3 million U.S. dollars) was misappropriated in high level suspected fraud.

The funds, he said, should be paid within the shortest period of weeks and not months.

The two governments have also asked law enforcement agencies in Zambia to follow up on the matter.

The first audit of the association's accounts was conducted in 2015 but the board of the farmers' association rejected the finding, prompting the donors to ask KPMG to conduct a new audit in July this year.

The two governments suspended further funding to the association in February this year after revelations of misappropriation of funds.

Corruption watchdog, Transparency International Zambia, has welcomed the two government's move to seek refunds from the farmers' body.

Goodwell Lungu, the watchdog's executive director said the move was welcome because it will send a strong message to other sectors of the economy not to misuse public funds.

This is the second time that Sweden has expressed displeasure over the misappropriation of funds it provides to Zambia.

In 2009, Sweden froze 33 million dollars in aid for health programs in Zambia after revelations showed misappropriation of funds by public workers in the Ministry of Health. Endit