More on Kroll deadline extended for another month – AIM report

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More on Kroll deadline extended for another month – AIM report

9:09 CAT | 25 Mar 2017

File photo / HSI32 Interceptor

The Mozambican Attorney-General’s Office (PGR) on Friday announced a further extension of the deadline for the audit into the three security-related companies, Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Asset Management).

The PGR has hired the London office of the US company Kroll, reputedly the foremost forensic audit company in the world, to carry out the audit, which is being financed by the Swedish Embassy.

At first Kroll was given until the end of February to deliver the audit report. When that proved impossible, the deadline was extended to the end of March. The PGR Friday statement announces a second extension, to 28 April.

The PGR repeated the arguments given for the first extension – namely that collecting the data required, from banks, suppliers and “other relevant institutions” in Mozambique and abroad, and then processing it all, was a complex task which involved “mechanisms of international cooperation”.

This complexity, the PGR added, “implied adopting certain legal procedures in line with the specificities of each of the various jurisdictions involved. This meant delays in making available additional relevant information”.

Kroll presented a report to the PGR on the progress made so far, and the prospects for concluding its analysis of the data, and drawing up the final report. On this basis it requested the second extension.

After consultation with the Swedish Embassy, and with the International Monetary Fund (IMF), the PGR agreed to extend the deadline to 28 April.

In 2013 and 2014, Ematum, Proindicus and MAM obtained loans in excess of two billion US dollars from European banks (mainly Credit Suisse and VTB of Russia). The previous Mozambican government, under President Armando Guebuza, illicitly guaranteed these loans, in violation of the 2013 and 2014 budgetary laws, and of the Constitutional requirement that such debts must be authorized by the country’s parliament, the Assembly of the Republic.

Of the three loans, only the 850 million dollars for Ematum, which took the form of a European bond issue, was publicly known. The loans to Proindicus (622 million dollars) and to MAM (535 million dollars) were kept secret, even from the Bank of Mozambique. When, thanks to press reports, the veil of secrecy was lifted in April 2016, the IMF reacted by suspending its programme with Mozambique. Other major western partners followed suit – and all 14 donors and funding agencies that provided direct support to the Mozambican state budget suspended all further disbursements.

The IMF made it clear that an international, independent audit of the three companies was an indispensable requirement for the resumption of normal business.

The Kroll audit should make clear exactly what assets or services were published with the two billion dollars, whether all the assets arrived, whether they were properly priced, and whether any of the money cannot be accounted for.

Source: AIM