Mozambique ex-finance minister convicted in US over 'tuna bonds' scandal

Mozambique ex-finance minister convicted in US over 'tuna bonds' scandal

By Luc Cohen

A former Mozambique finance minister was convicted on Thursday on U.S. criminal charges over his alleged involvement in a fraud involving $2 billion in loans to three state-owned companies to develop the African nation's fishing industry.

Jurors found Manuel Chang guilty of conspiracy to commit wire fraud and conspiracy to commit money laundering in the "tuna bonds" case, following a three-week trial in federal court in Brooklyn, New York.

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Chang plans to appeal the verdict, defense lawyer Adam Ford told reporters outside the courtroom.

Prosecutors said shipbuilding firm Privinvest paid Chang $7 million in bribes in exchange for approving a Mozambique government guarantee for loans to three state companies to develop the African nation's fishing industry and improve maritime security.

The loans came from Credit Suisse and Russian bank VTB.

Chang received the funds in a Swiss bank account controlled by a friend and had other Mozambican officials communicate with Privinvest about the payoffs in an attempt to cover his tracks, prosecutors said.

The projects eventually collapsed and the state-backed companies defaulted on their loans, leaving investors with millions of dollars in losses.

Donors such as the International Monetary Fund temporarily halted support, triggering a currency collapse and financial turmoil.

"Today's verdict is an inspiring victory for justice and the people of Mozambique," Breon Peace, the top federal prosecutor in Brooklyn said in a statement.

Peace called Chang "a corrupt, high-ranking government official whose greed and self-interest sold out one of the poorest countries in the world."

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Ford argued that his client approved the Mozambique government guarantee because the country's president wanted him to, and said there was no evidence the $7 million was intended for Chang.

"That money never went to Minister Chang," Ford said in his closing argument on Monday.

Two Credit Suisse bankers pleaded guilty in 2019 and testified against Chang at trial.

Another co-defendant, Privinvest salesman Jean Boustani, was acquitted at a 2019 Brooklyn trial after testifying that he had no role in packaging the loans for investors.

Prosecutors said officials and bankers embezzled $200 million of the $2 billion in financing raised for the projects from 2013 to 2016.

Credit Suisse, acquired by Swiss rival UBS, agreed to pay $475 million to Britain and the United States in 2021 to resolve related bribery and fraud charges.

Mozambique on July 29 won the bulk of its $3.1 billion lawsuit in London's High Court against Emirati-Lebanese Privinvest for allegedly paying bribes to Mozambican officials and Credit Suisse bankers to secure favorable terms.

A Privinvest spokesperson said the company intends to appeal against that court's finding that it paid bribes to Chang, and that it would be unfair to pay hundreds of millions of dollars in damages.

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