Attorney-General on releasing Kroll audit results, Embraer and Odebrecht investigations

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Attorney-General on releasing Kroll audit results, Embraer and Odebrecht investigations

9:01 CAT | 29 May 2017

Folha de Maputo / Attorney/General Beatriz Buchili

Mozambique’s Attorney-General, Beatriz Buchili, on Monday once again assured the public that her office is working with auditors from the company Kroll Associates, in order to release the results of the audit into the security-related companies Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Assets Management).

These three companies obtained loans of over two billion dollars in 2013 and 2014 from European banks that were illegally guaranteed by the previous Mozambican government, under President Armando Guebuza. These loans added 20 per cent to Mozambique’s foreign debt, pushing it to unsustainable levels.

The failure of the government to disclose the true size of the debt led the International Monetary Fund (IMF) and other western partners to suspend financial cooperation with Mozambique. The IMF made clear that an international, independent audit of Ematum, Proindicus and MAM was an essential prerequisite for resuming normal relations.

Speaking at the opening of a three day meeting in Maputo of the Coordinating Council of the Public Prosecutor’s Office, Buchili said that her office has received the audit report from Kroll “and we are concluding the work of verifying the report’s conformity with the terms of reference because, as you know, the audit was requested to provide technical assistance to the preparatory investigation that is under way”.

This is the investigation into possible crimes committed in the operations of the three companies. Prosecutors launched an investigation into Ematum in 2015, and when the existence of the Proindicus and MAM loans became public knowledge in April 2016, these two companies were added to the investigation.

“We need a consolidated report which effectively supports our investigations”, said Buchili, “and the recommendations may help the country adopt measures to strengthen the management of the public finances”.

Kroll delivered the report on 12 May. Thus Buchili’s office has had over two weeks to discuss it with the auditors and to check that it meets the terms of reference (which have not been made public).

Buchili seemed acutely aware that the eyes of Mozambican society are fixed on her office, and that there is enormous public interest in knowing the contents of the Kroll report. “We are doing our best under the procedures agreed with the auditor”, she said, “and we renew our appeal for calm and understanding since, as we have promised, we shall share with the public the results of the audit, as soon as the work under way is concluded”.

Embraer and Odebrecht investigations

Buchili admitted that the public is also concerned about two huge corruption scandals, both involving bribes paid by Brazilian companies. The Brazilian aircraft manufacturer, Embraer, has admitted paying an 800,000 dollar bribe to secure the purchase by Mozambique Airlines (LAM) of two Embraer planes. Prosecution documents in Brazil named former LAM chairperson Jose Viegas, and the former head of Mozambican operations for the South African petrochemical company Sasol, Mateus Zimba, as involved in procuring the bribe.

An even larger bribe, of 900,000 dollars, was paid by the Brazilian construction company Odebrecht to as yet unnamed Mozambican officials.

All these cases, Buchili said, were complex and involved the jurisdictions of several countries. Her office, she added, was resorting to “international cooperation mechanisms to clear up these cases”.

Giving an overview of the criminal situation, she said there had been a gradual deterioration, with 61,144 criminal cases opened in 2016, compared with 60, 239 in 2015. On 31 December 2016, there were 18,182 people held in Mozambican prisons, compared with 15,203 a year earlier.

Buchili asked whether public prosecutors were doing all that they should to ensure that cases are handled speedily, and that legal procedures are respected. She wanted to see the Public Prosecutor’s Office “intervening more in the defence of human rights and in the control of legality”.

Prosecutors, she insisted, must not be satisfied simply with investigating and jailing suspects, but they must also “ensure a fair trial, the right to appeal, and compliance with the sentence and with the rights that convicted persons enjoy”.

Prosecutors, Buchili continued, also had a key role to play “in preventing and fighting administrative offences, and preventing the dilapidation of the public treasury, particularly in the sphere of procurement”.

Source: AIM