Maputo — The Mozambican Attorney-General's Office (PGR) has not withdrawn accusations of bribery against the Abu Dhabi based group, Privinvest, which is at the heart of the scandal of Mozambique's "hidden debts".
This term refers to the loans of over two billion US dollars made in 2013 and 2014 by the banks Credit Suisse and VTB of Russia to three fraudulent Mozambican companies, Proindicus, Ematum (Mozambican Tuna Company) and MAM (Mozambique Assets Management).
The loans were only possible because the banks carried out no due diligence on the three companies, which had no business record and were effectively run by the Mozambican security service, SISE, and because the Mozambican government of the day, under the then President, Armando Guebuza, issued illegal loan guarantees, in violation of the 2013 and 2014 budget laws, and of the Mozambican constitution.
The loan guarantees were signed by the then Finance Minister Manuel Chang, who is currently languishing in South African custody, awaiting a decision as to whether he will be extradited to Mozambique or to the United States. Both countries wish to put him on trial for crimes concerning the fraudulent scheme.
Massive corruption was involved in the loans, as was admitted by the three Credit Suisse managers who negotiated them, Andrew Pearse, Detelvina Subeva, and Surjan Singh. These three people were among those charged by American prosecutors, who took a close interest in the case because the US financial system had been abused, and US investors were swindled. According to the prosecutors, at least 200 million dollars of the loan money was diverted into bribes and kickbacks.
Privinvest was closely involved in the bribery as became clear in the 2019 trial in New York of Privinvest official Jean Boustani. Privinvest was very much an interested party since it became the sole supplier to Proindicus, Ematum and MAM. An independent audit into the two companies in 2017 showed that Privinvest had vastly inflated the prices it charged for the fishing boats and other assets it supplied. This over-invoicing was estimated at around 700 million dollars.
The PGR began proceedings in London in 2019 against five companies in the Privinvest group - namely Privinvest Shipbuilding S.A.L. Abu Dhabi (Branch), Abu Dhabi Mar LLC, Privinvest Shipbuilding Investments LLC, Logistics International SAL (Offshore), and Logistics International Investments. It is also suing Credit Suisse and the three Credit Suisse officials who have admitted taking Privinvest bribes, Pearse, Subeva and Singh.
The key demand from the PGR is that the London court should declare null and void the government guarantee on the 622 million dollar loan arranged by Credit Suisse for ProIndicus, on the grounds that this debt, along with the rest of the loans were part of a gigantic fraud.
Privinvest's lawyers have attempted to muddy the waters, claiming that the London court does not have jurisdiction in the case, which should instead be heard by the International Arbitration Tribunal in Switzerland. Some of the Mozambican press have swallowed this line with last week's issue of the weekly paper "Canal de Mocambique" claiming that there has been an upset in the London court proceedings and that the PGR has withdrawn its accusations of bribery against Privinvest.
Interviewed by the German agency DW Africa, Borges Nhamirre, a researcher for the anti-corruption NGO, the Centre for Public Integrity (CPI), who has followed the case right from the start, stressed that, in reality, the PGR "has not changed a single comma" in its charge sheet.
The real dispute, he said, is over where the case should be heard, in London or in Switzerland. "Obviously the PGR maintains the accusation of bribery", said Nhamirre.
But two quite different forms of bribery were involved. One was the illicit payments under the procurement contracts, made to ensure that Privinvest became the supplier. But that, contrary to claims by Privinvest lawyers, is not the subject of the PGR's suit.
Instead, the PGR is going after the bribes that were paid to the then finance minister Manuel Chang to ensure that he signed the loan guarantees. Without the guarantees, the banks would never have paid the money, and the whole corrupt scheme would have collapsed.
"What Mozambique is demanding now is that Privinvest and the other accused, 12 in all, be found guilty because there was fraud in the guarantee contracts", said Nhamirre.
The PGR "is asking the British court that the guarantees issued for the loans be declared null and void. It is not discussing the bribes that happened under the supply contracts", he added.
Privinvest, said Nhamirre, had given Chang a bribe of seven million dollars, and that was the question at stake. The issue of other bribes, paid to secure the supply contracts, was not relevant.
Nhamirre believed that the PGR had "defended very well the interests of Mozambican society".
"The PGR began the case in London to declare the guarantees null and void", he continued. "What does this mean? It means that the PGR is saying that Mozambique does not want to pay the hidden debts. The Mozambican state is doing this, and it is doing it very well".
As for the claim that President Filipe Nyusi had put pressure on the PGR to withdraw the accusations of bribery, Nhamirre replies "I have no grounds for saying that the President did this. And in fact there has been no withdrawal".