Mozambique: Foreign minister attends Non-Aligned Movement Meeting in Kampala, Uganda
Hidden debts: Recover the money, Chissano urges
12:51 CAT | 13 Jan 2019
Joaquim Chissano. File photo
Former Mozambican President Joaquim Chissano has urged that, in the investigation into the scandal of Mozambique’s “hidden debts”, it is more important to recover the money than to send culprits to jail.
Interviewed by Radio Mozambique on Thursday, Chissano said jailing the fraudsters would not be worth much, if the money is not returned. He urged the bodies of the administration of justice in Mozambique, the United States and South Africa to work together to ensure that the money which ended up in illicit pockets is returned for the benefit of Mozambique.
Chissano, who is Honorary President of the ruling Frelimo Party, is the first senior Frelimo figure to speak on the scandal since the arrest of former Finance Minister Manuel Chang in Johannesburg on 29 December. Chang was detained on the basis of an international arrest warrant issued by the United States. US prosecutors intend to charge him with conspiracy to commit money laundering, wire fraud and securities fraud.
This stems from the illicit loans for over two billion US dollars which three fraudulent Mozambican companies, Proindicus, Ematum (Mozambique Tuna Company) and MAM (Mozambique Asset Management), obtained in 2013 and 2014 from banks Credit Suisse and VTB of Russia.
The companies were recent creations, essentially of the Mozambican intelligence services, SISE, and so had no track record whatsoever. Yet the banks threw money at them, since the government guaranteed 100 per cent of the loans. Chang, as finance minister at the time, signed most of the loan guarantees.
The American warrant has also led to the arrest of three former Credit Suisse executives, Andrew Pearse, Surjan Singh and Detelvina Subeva, and of Jean Boustany, an official of the Abu Dhabi based company Privinvest, which was the sole contractor for the three fake companies.
If any of the missing money is found, it should be returned to Mozambique, Chissano insisted in his radio interview. But he admitted he did not know “what strategies can be used to return the money”.
The American indictment estimates that at least 200 million dollars of the Credit Suisse and VTB loan proceeds went on bribes and kickbacks. The conspirators did not cover their tracks well, and the names and bank account numbers of those who received the bribe are known to the US prosecutors.
However, the US legal system may well believe that the US investors who were defrauded (those institutions which bought Ematum bonds, for example) have first call on any recovered money.
In addition there is the over-invoicing practiced by Privinvest. Credit Suisse and VTB sent money straight to Privinvest, and Privinvest sent fishing boats and other assets to Mozambique. The independent audit into Proindicus, Ematum and MAM by the company Kroll in early 2017 found that the assets had been grossly overpriced. Kroll valued the assets independently, and found that Privinest had overcharged by 713 million dollars.
Recovering this money could prove difficult, since Privinvest itself has not been charged under the US indictment. Nonetheless, there is a clear case for Mozambique pursuing Privinvest through the courts to recover the money.
Chissano said he was well aware that Frelimo’s opponents will make use of the scandal. But he hoped it would also allow Frelimo to become more honest. “The party should analyse, with greater clarity, what happened and how it happened”, he said. “Only this will guarantee that the party take the measures necessary, so that this never happens again”.
Such a reflection on Frelimo’s performance, Chissano added, “is not easy”, but must be done.
The scandal also caught up with Veronica Macamo, the chairperson of the Mozambican parliament, the Assembly of the Republic, of which Chang is a member. Speaking to reporters in Cape Verde on Thursday, where she was attending a session of the Parliamentary Assembly of the Community of Portuguese Speaking Countries (CPLP), she said the Assembly was following developments and wanted to see “scrupulous compliance with the applicable norms”.
Source: AIM
Show comments
Also read
Leave a Reply
1 Comment on "Hidden debts: Recover the money, Chissano urges"
You must be logged in to post a comment.
You must be logged in to post a comment.
Great idea. Let them go unpunished and tomorrow they’ll do the same or worse. He should know, the first sacking happened under his watch and the culprits, almost all of them, went free. It’s like issuing a psychological booster