Mozambique steps up the case against Credit Suisse - AIM report
in file CoM
Jean Boustani, the sales executive from the Abu Dhabi based group Privinvest, currently on trial in New York, will have to pay at least 1.2 million US dollars to two of his defence witnesses who testified on Friday.
Boustani is facing charges of conspiracy to commit money laundering, wire fraud and securities fraud in connection with Mozambique’s “hidden debts” – the over two billion dollars which three Mozambican security-linked companies, Ematum (Mozambique Tuna Company), Proindicus and MAM (Mozambique Asset Management) obtained from the banks Credit Suisse and VTB of Russia, on the basis of illicit loan guarantees issued by the government of the day, then under President Armando Guebuza.
The prosecution argues that Boustani was an architect of the scheme, and used loan money o pay at least 200 million dollars in bribes and kickbacks. Privinvest was the sole contractor for the three Mozambican companies: the audit of the three firms done by the company Kroll in 2017 showed that the goods provided by Privinvest were overpriced by around 700 million dollars. Both Boustani and Privinvest deny any wrongdoing.
Boustani’s defence denies that American investors who purchased the bonds issued by Ematum or part of the syndicated Proindicus debt were swindled, or that Boustani used the US financial system for the scheme.
But two of the witnesses on whom the defence relies are demanding payment for their services, and they do not come cheap.
According to the report of the trial in Monday’s issue of the independent daily “O Pais”, David Hinman, a specialist in financial markets, told the court he was charging 750 dollars an hour for his services. He claimed he had spent 300 hours preparing the presentation he gave in court – which means he wants Boustani to pay him 225,000 dollars.
He said that those who purchased the Ematum or Proindicus securities should have known about the risk of corruption. He claimed that “in Mozambique bribery is common and government officials routinely accepted bribes and kickbacks to approve public works projects”.
In his view, bribes and kickbacks are just the price to be paid for doing business in a country “with a corrupt government”. But he had no problems with this, and said he had always invested in corrupt countries. They were the most lucrative places in which to invest, precisely because of the high risk.
Where risks were low, so were profits. Hinman gave the example of Denmark, generally regarded as one of the least corrupt countries in the world. He said Denmark was not an attractive market for capital investors, because of the low risk.
Even if Hinman’s claims were true, bribery still remains illegal under both Mozambican and American law.
Hinman’s boasts irritated prosecutor Mark Bini who confronted him with the standard anti-corruption clauses in the norms that the managers of investment funds are supposed to follow. These ban the use of bribes in business.
Chudozie Okungwu, a specialist in international trade and emerging markets began testifying on Friday, and he will be even more expensive for Boustani. Since he does not work for Privinvest, he was charging 950 dollars an hour for his time. He claimed he had spent 100 hours on the case, and so is owed 95,000 dollars.
Okungwu worked with six technical staff, who should be paid 900,000 dollars. So for just two witnesses, Boustani is facing a bill of 1.22 million dollars.
This comes on top of the fees he must pay for his team of lawyers. Their fees have not been announced, but a typical attorney in a metropolitan area such as New York can charge up to 400 dollars an hour – and experienced, specialist lawyers are likely to cost much more.Source: AIM
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