Hidden debts: Defence lawyers attack the Public Prosecutor – AIM report

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Hidden debts: Defence lawyers attack the Public Prosecutor – AIM report

6:55 CAT | 08 Mar 2022

File photo: TVM

Lawyer Abdul Gani on Monday accused the Public Prosecutor’s Office of “hiding the truth” in the case of Mozambique’s “hidden debts”.

Gani is the lawyer for Gregorio Leao, the former general director of Mozambique’s Security and Intelligence Service (SISE), one of 19 people charged with financial crimes in relation to the debts. Summing up on behalf of his client, Gani preferred to attack the prosecutor rather than defend the behaviour of his client.

Gani accused the prosecution of falsifying documents, and repeatedly claimed here was “no proof” for the charges. At one stage he told lead prosecutor, Sheila Marrengula “You think we are all inferior”.

He claimed the prosecution had concentrated on the 70 million dollars which the Abu Dhabi based group Privinvest had allegedly paid in bribes to the defendants and had ignored the rest of the over two billion dollars of the illicit loans that gave rise to the debts.

“Where’s the rest of the money?”, he asked. “This isn’t serious, it isn’t honest”.

In reality, Marrengula had explained in detail how the scheme had worked. Three fraudulent companies set by SISE – Proindicus, Ematum (Mozambique Tuna Company) and MAM (Mozambique Assets Management) – had obtained over two billion dollars in loans from the banks Credit Suisse and VTB of Russia, on the basis of illegal loan guarantees signed by the then Finance Minister, Manuel Chang. The banks forwarded every cent of this money, not to Mozambique, but to Privinvest, which then sent fishing boats, radar stations and other assets to the three companies at vastly inflated prices.

According to the 2017 independent audit of the three companies, Privinvest overcharged them by more than 700 million dollars – which allowed it to use at least 200 million dollars in bribes and kickbacks to Credit Suisse bankers and Mozambican officials.

Gani declared that the prosecution should have sued Proindicus, Ematum and MAM. “It was the companies that contracted the debt”, he said.

All three companies went bankrupt, and all three are currently being liquidated. Gani found this highly suspicious and claimed this was “an attempt to hide evidence”.

He objected to Marrengula’s argument that Leao had used his wife Angela Leao as a front person for illicit activities, and claimed that the activities of husband and wide were completely separate.

Angela Leao’s lawyer, Daniel Cumbana, argued that much of the money involved in the “hidden debts” had been spent on defence and security. He repeated the frequent claim that 500 million dollars of the 850 million lent to Ematum had been spent on defence. But this claim was denied in 2017 by the then defence minister Salvador M’tumuke, and at this trial by former interior minister Alberto Mondlane.

Called as a witness in February, Mondlane said that nothing at all from the Ematum loan had been diverted to defence purposes.

Cumbane said that Angela Leao could not be accused of embezzlement, because this crime can only be committed by state employees, and Leao had never been employed by the Mozambican state.

He did not so much as mention the main case against Leao – the prosecution had argued, in great detail, that she had built up a large real estate portfolio, on the basis of bribes paid by Privinvest. But Cumbana said nothing about Leao’s properties or how she had come to own them.

A lawyer who had no problem with Privinvest bribes was Lourenco Malia, representing Teofilo Nhangumele and his associate, Bruno Langa, who had each taken 8.5 million dollars from Privinvest. Of course, Malia did not call these payments bribes – to him, they were “success fees”.

Nhangumele has boasted that he came up with the name Proindicus for the first of the three fraudulent companies and registered the name. He was thus talking with Privinvest officials right from the start of the scheme.

Malia said that Privinvest had hired Nhangumele as a consultant, and as part of this contract paid him millions of dollars as a “success fee”. He could see nothing wrong with this.

He did not believe that Nhangumele or Langa could have swindled the Mozambican state because they were not employed by the state.

Furthermore, he believed that Privinvest won the contracts to become the sole supplier for Proindicus, Ematum and MAM merely because it was “commercially aggressive, which is not illegal”.

The defence lawyers will continue to address the court on Tuesday.

Source: AIM