Mozambique: Boustani Takes the Stand in New York Trial

U.S. dollars.

Maputo — Jean Boustani, the senior sales executive from the Abu Dhabi-based group Privinvest, on trial in New York over his role in the scandal of Mozambique's "hidden debts" took the stand in his own defence on Monday.

Boustani is facing charges of conspiracy to commit money laundering, wire fraud and securities fraud, in connection with the scheme whereby three Mozambican security-related companies, Proindicus, Ematum (Mozambique Tuna Company) and MAM (Mozambique Asset Management) obtained over two billion dollars in loans from the banks Credit Suisse and VTB of Russia, based on illicit loan guarantees issued by the government of the time, under President Armando Guebuza.

Putting Boustani on the stand is a high risk strategy for the defence, since it exposes him to cross-examination by experienced prosecutors who have amassed a mountain of evidence backing claims that Boustani was deeply involved in paying bribes and kickbacks to Credit Suisse bankers and to Mozambican government officials, including the then Finance Minister, Manuel Chang.

At the start of his testimony, according to the official transcript of the trial, Boustani categorically denied conspiring to defraud investors or conspiring to launder money.

But much of what he said concentrated on how he had become involved in Africa in the first place. He claimed that the opportunity for developing a "coastal monitoring project" in Africa (the eventual justification for the three Mozambican companies) was introduced "by a friend from South Africa named Basetsana Thokoane", nicknamed Bassey "who used to be an official in the South African secret service".

Whether or not this is true, it is certain that a few years earlier Thokoane had been a spokesperson for the South African Foreign Ministry - a fact Boustani seemed unaware of.

Boustani claimed that, in order to handle business in Africa, "If you have to deal with the government, you need to get deal makers, usually you have brokers, middlemen — in America maybe they're called lobbyists — to open doors, to secure for them the licenses, concessions, to execute the project."

"I was primarily seeking to find agents to develop business in Africa," he said, and Thokane fell into that category.

He claimed that first she presented him with an opportunity in Namibia, but eventually she put him into contact with Teofilo Nhangumele, who became a key fixer for the first of the hidden loans, to Proindicus.

He believed that Nhangumele was an agent of the Mozambican secret service, SISE - although there is no evidence that Nhangumele was ever employed by SISE.

Boustani said he presented the Privinvest shipbuilding business to Nhangumele, and they discussed the need to protect Mozambique's coastal resources.

And at that point, the judge ended the session, since he had promised the jury they could leave at 17.00 New York time. Thus only when Boustani resumes giving evidence, on Tuesday, will the key evidence against him be discussed.

The prosecutors do not believe Boustani was doing anything so relatively innocent as working with "brokers" or "agents". In the previous weeks of the trial, the prosecutors have shown the jury hundreds of emails and other documents, which they regard as hard evidence of the bribes and kickbacks that Boustani and Privinvest allegedly paid, amounting to at least 200 million dollars of the loan money.

Earlier in the day, the prosecutors, cross-examining a supposedly expert witness, Chuduzie Okungwu, whose expertise is in international trade and emerging markets, showed that his knowledge of Mozambique was, to put it mildly, woefully inadequate.

He claimed he had relied on International Monetary fund (IMF) reports in drawing up his presentation, yet he did not know that the then head of the IMF, Christine Lagarde, had met with Mozambican officials in 2016 concerning the undisclosed loans.

Until the prosecution told him, he did not even know that former SISE agent Antonio do Rosario was chairperson of Ematum, even though he had talked at considerable length about Ematum earlier in his testimony.

Did he know that Christine Lagarde had met with Rosario? No. Did he know that Boustani and Privinvest had paid millions of dollars to Rosario in connection with the Ematum loan? No. Did he know that Lagarde had also met with Deputy Finance Minister Isaltina Lucas, and that Privinvest and Boustani had paid her millions of dollars too? No, he did not.

Was Okungwu aware that the company Kroll had carried out an independent audit of Proindicus, Ematum and MAM? "I have not read the Kroll report", he admitted.

Okungwu did not even know that Mozambique's highest court, the Constitutional Council had declared (in June) that the government guarantee for the Ematum bond was illegal.

On Friday, Okungwu told the court that, 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. He said he worked with six technical staff, who should be paid 900,000 dollars.

So Okungwu expects Boustani to pay him close to a million dollars for his testimony. Given his inability to answer the prosecutors' questions, it seems that Boustani is getting a poor deal for that money.

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