Hidden debts | Verdict and sentence: 30 November, 2022 – AIM report

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Hidden debts | Verdict and sentence: 30 November, 2022 – AIM report

7:17 CAT | 01 Dec 2022

Photo: O País

Ndambi Guebuza, the oldest son of former Mozambican President Armando Guebuza, was a key figure in the country’s “hidden debts” scandal, and used his family connection to drag the Mozambican state ever deeper into the mire.

That, at least, is the conclusion to be drawn from the evidence summarized on Wednesday morning by judge Efigenio Baptista of the Maputo city court, as he began to read out his verdict and sentence.

The term “hidden debts” refers to the loans of over two billion US dollars obtained from the banks Credit Suisse and VTB of Russia by three fraudulent, security linked companies, Proindicus, Ematum (Mozambique Tuna Company) and MAM (Mozambique Assets Management). The banks granted the loans, in 2013 and 2014, because the government of the time, under Guebuza, granted illicit loan guarantees, even though all three companies were set up by the security service, SISE, and there was never any likelihood that they could repay.

19 people were charged with various offences arising from the loans – including money laundering, embezzlement, blackmail, abuse of office and criminal conspiracy. The prosecution has asked for the maximum sentence for seven of them, including Ndambi Guebuza, the former General Director of SISE, Gregorio Leao, and his deputy, Antonio Carlos do Rosario.

The trial began on 23 August 2021, and the case file, said Baptista, ran to more than 30,000 pages. It was therefore not particularly surprising that it took him months to write up the verdict, which is 1,388 pages long. It is expected that Baptista will need five days to read it out.

He began with the role of Ndambi Guebuza, and the bribes that he had allegedly demanded from the Abu Dhabi based group, Privinvest, which became the sole contractor for Proindicus, Ematum and MAM.

The initial idea was that the government would hire Privinvest to run a coastal protection scheme. The man who claims that this was his brainchild, Teofilo Nhangumele, organized meetings between government and Privinvest officials, notably the senior Privinvest salesperson, Jean Boustani.

But at first the scheme seemed to have stagnated. Nothing was happening, and so Nhangumele turned to his colleague Bruno Langa for help – and Langa went to his friend, Ndambi Guebuza. Could Guebuza intervene with his father, to ensure that the Privinvest plans went ahead?

It turned out that Ndambi was willing to seek help from his father – but at a price. To ensure that Privinvest won the contracts, huge bribes would be needed. Nhangumele asked Boustani to add an extra 50 million dollars to the bill “to massage the system”.

Boustani agreed – and, after some haggling, it was agreed that the greater part of this bribe would go to Ndambi. He would receive 33 million dollars, while Nhangumele and Bruno Langa would be paid 8.5 million dollars each. (Ndambi, however, has vehemently denied taking any money from Privinvest).

As he outlined these corrupt schemes, Baptista cited extensively from email correspondence between Boustani, Nhangumele and the other conspirators.

Visits were arranged to Privinvest installations in Germany and Abu Dhabi, where Nhangumele and Langa were treated as senior Mozambican state officials – although neither of them was employed by the state. SISE paid the transport costs.

Quite illicitly, Privinvest arranged official United Arab Emirates documents – such as work visas and residence permits – for Nhangumele, Langa and Ndambi, which allowed them to open bank accounts in Abu Dhabi, where much of the bribe money was deposited.

Once the bribes were paid, Ndambi went on a spending spree, using much of the money to buy real estate and luxury vehicles in South Africa.

The prosecution outlined these purchases in exhausting detail – giving not only bank account numbers but even engine and chassis numbers for the vehicles.

The minute details of all the transactions could make it very difficult for Ndambi’s defence lawyers to mount an effective appeal if he is convicted.