Ecuadoran Potato Cakes with Peanut Sauce

Peel potatoes and cut into 1-inch pieces. Cover potatoes with cold water in a medium pot, then stir in 1 teaspoon salt and simmer until very tender, about 18 minutes.
While potatoes simmer, cook garlic and 1/3 cup scallions in 2 tablespoons annatto oil in a small saucepan over medium heat, stirring, until softened, about 2 minutes. Stir in cumin and 1/4 teaspoon pepper and cook, stirring, 1 minute. Add tomato and cook, stirring, 2 minutes. Add milk and bring to a bare simmer, then remove from heat and stir in peanut butter until combined well. Keep peanut sauce warm, covered, off heat.
Drain potatoes, then mash in a bowl.
Cook remaining 1/2 cup scallions with 1/4 teaspoon salt and 1/4 teaspoon pepper in 2 tablespoons annatto oil in a small saucepan over medium heat, stirring, until scallions are softened, then stir into potatoes along with cheese. Form potato mixture into 8 balls and flatten each into a 3-inch patty.
Heat 1 tablespoon annatto oil in a 12-inch nonstick skillet over medium-high heat until hot, then fry cakes in 2 batches, turning over once, until crusty, about 6 minutes per batch. Add remaining tablespoon annatto oil for second batch.
Gently reheat peanut sauce, thinning to a creamy consistency with a little water if necessary. Season sauce with salt and serve with potato cakes.