Victims of Chinese moneylenders protest in Maputo

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Victims of Chinese moneylenders protest in Maputo

6:38 CAT | 24 Nov 2016

File photo / Public Attorney's Office in Maputo

Thousands of Mozambicans have fallen victim to a loan scheme which promised monthly interest payments of 30 percent.

About ten thousand people are involved in the illegal Mutual Aid Credit Association money-lending business operated by citizens of Chinese origin in Maputo city.

Victims gathered yesterday at the Prosecutor’s Office in Maputo to demand clarification on the whereabouts of their money, frozen by the central bank.

The institution, known as ‘The Chinese Bank’, had daily dealings in excess of two million meticais, (about US$30,000), and operated illegally in Maputo.

In an action coordinated by the Attorney General’s Office, the Bank of Mozambique closed the association and froze its accounts, causing thousands of citizens to despair.

The borrowers involved have banded together to demand the repayment of the amounts they invested in the scheme.

“The last time we were here we were told to come back in 15 days to find out about our lawsuit, but six months have gone by without an answer,” said one distraught borrower.

“We are here at the Prosecutor’s Office because we want our money. Even if they say that what we were doing was not in accordance with the government’s rules, they should stop and give us back our money; it is the sweat of our brow. Can you imagine what it’s like for a person to be selling ‘badjias’ on the street to raise money and lose it all just like that? There are many people here who have debts with the bank,” a borrower complained.

The association purported to take in a minimum of 20,000 meticais (about US$280) and pay interest of 30 percent on the capital invested after 30 days.

The Bank of Mozambique says that the irregularity was discovered in the course of regular inspections in which it detected operations legally reserved for banks and other institutions authorised to receive deposits and other repayable funds were being carried out by the association.

“The Bank of Mozambique has made enormous efforts in banking supervision, through face-to-face inspections in the field according to the risk profile that institutions present,” central bank administrator Waldemar de Sousa said.

The Attorney General’s Office says that the process which would enable loss-making parties to establish the fate of the money was still in the preparatory stage. The whereabouts of the association officials are currently unknown.

Source: Voa Portugues