At the request of defence lawyers, the hearing of Manuel Chang was adjourned until Friday 18 January at Kempton Park Magistrates Court, Johannesburg. It appears the defence will appeal to the high court over the arrest of Chang. The issue of bail continues to be debated, so Chang has been returned to jail, but to a private cell instead of one shared with other prisoners.
The bail argument is over the level of the offence. Schedules 5, 6, and 7 are the most serious - murder, violence, and large thefts and fraud. (https://www.yambu.co.za/bail-application/) Police can grant bail for lower level offences, but a court grants bail for higher levels. The magistrate says the offence is schedule 5. At Schedule 5, bail is not automatic and it remains with the defence to justify bail. The prosecution will argue that as Chang is accused by the US of obtaining $12 mn in bribes, so he has resources, thus the bail must be high and conditions strict.
The arrest debate is complicated. The US requested his arrest pending the submission of an arrest warrant. Chang's South Africa defence lawyers argue this is not adequate, buth the magistrate has agreed with the prosecution that this is precisely as specified in the extradition agreement with the US. The US now has 60 days to file the full extradition demand.
Meanwhile Mozambique has now charged Chang. Mozambique will now oppose his extradition on two grounds. First, that he is a Mozambican diplomatic passport holder. (Noticias 10 Jan) Second that he should first be tried inside Mozambique, according to Rick Messick, a lawyer specialising in anti-corruption and a former Chief Counsel to the United States Senate Committee on Foreign Relations, in his Global Anti-Corruption blog. He adds no one "believes the current government of Mozambique would actually put Chang on trial, actually try to convict him if it did, and really seize his assets if he were convicted." See Zitamar 10 Jan and https://globalanticorruptionblog.com/2019/01/09/the-promise-and-risk-of-internationalizing-the-corruption-fight-prosecuting-the-mozambique-loan-fraud/
Mozambique names its accused
The attorney general's office (PRG, Procuradoria-Geral da Republica) has named 17 people, including Chang and former central bank governor Ernesto Gove, who it says should face financial penalties for their part in the $2.2 bn secret debt. The list was published in Noticias this morning. (Zitamar, Noticias 10 Jan)
The PGR called for Mozambique’s Audit Court (Tribunal Administrativo, TA) to hold the list of people “financially responsible” for the deals. It made the same call to the TA in January 2018 - but now it has also made the list of the accused public. (Zitamar 10 Jan) Thus the PRG seems not to be proposing criminal charges (as in the US), but only financial penalties. The TA already found in 2017 that the sovereign guarantees for the loans were granted illegally.
Details of the PGR’s case published in Noticias today say that there was abuse of public funds in: making undue payments; in capitalising the companies; financing projects which had not been subject to public tender; signing contracts without TA approval; using the proceeds of the financing for things other than the projects; and not cooperating fully with the Kroll forensic audit of the three companies.
The accused include directors of all three companies - MAM, Prindicus, and Ematusm - that are owned by the state and controlled by the security services, SISE, and took out the loans. The full list of the accused as published by Noticias and Zitamar (with some names repeated in different lists):
For involvement in authorisation of the guarantees:
- Manuel Chang (then finance minister)
- Ernesto Gove (then central bank governor)
- Maria Isaltina Lucas (then head of treasury at Ministry of Finance who approved the illegal loan guarantees, now vice-minister of finance and EMATUM director)
- Piedade Macamo (deputy head of treasury at Ministry of Finance)
- Gregorio Leao (then head of SISE)
- Antonio Carlos do Rosario (SISE official heading up the three companies)
For simultaneously holding public office and being in the companies benefiting from the loans:
Antonio Carlos do Rosario
Maria Isaltina Lucas
Henrique Alvaro Cepeda Gamito (Ministry of Finance advisor and EMATUM director)
For their involvement in managing funds with illegal guarantees:
- Victor Bernardo (ProIndicus chairman)
- Eugenio Henrique Zitha Matlaba (ProIndicus director)
- Raufo Ismael Ira (ProIndicus director)
- Antonio Carlos do Rosario (ProIndicus director)
- Jose Manuel Gopo (ProIndicus director)
- Antonio Carlos do Rosario
- Maria Isaltina Lucas
- Ivone Lichucha (EMATUM director)
- Agi Anlaue (EMATUM director)
- Felisberto Manuel (EMATUM chief executive)
- Herminio Lima Alberto Tembe (EMATUM director)
- Henrique Alvaro Cepeda Gamito
- Cristina Alice Valente Matavel (EMATUM director)
- Nazir Felizardo Passades Aboobacar (MAM director)
- Raufo Ismael Ira (MAM director)
- Agi Anlaue (MAM director)
Other corruption charges - Taipo and Chang
Carta de Mocambique (9, 10 Jan) reports movement on two other corruption cases. It says that Chang as well as former Transport Minister Paulo Zucula have been charged with receiving bribes from the Brazilian construction company Odebrecht for the construction of the almost totally unused $125 mn Nacala airport. Information was supplied by Odebrect as part of its deals with authorities in Brazil as part of the much larger "car wash" investigation.
The case of Helena Taipo, former Labour Minister and now ambassador to Angola, will be sent to court soon, Carta reports. She is charged with receiving most of $1.7 mn taken from the National Social Security Institute (Instituto Nacional de Seguranca Social, INSS) as kickbacks on contracts when she was minister. INSS is under the Ministry of Labour.