In 2013-2014, three newly created Mozambican companies took out a loan of $ 2.2 billion. They all had ties to people in the inner circle of former Mozambican President Armando Guebuza, and the Mozambican government was secretly listed as a guarantor – without parliamentary approval.
One of the companies is the state-owned EMATUM (Mozambique Tuna Company), which reportedly received part of the money to buy tuna fishing boats. The remainder would go to building a shipyard in Maputo and maritime security projects along the country’s coastline.
According to listeners, $ 500 million of the money has gone missing. The secret lending saga would quickly precipitate into a budget crisis, and in 2017 Mozambique defaulted on $ 727 million in bonds, plunging its currency. The IMF and other foreign donors at the time also withdrew their aid when loan fraud emerged.
Bank Credit Suisse has been under investigation by UK and US financial authorities since arranging the loans. Authorities blamed the bank for inadequate controls to reduce the risk of fraud, despite being aware of the likelihood of corruption linked to government plans.
In addition, an entrepreneur allegedly organized bribes totaling $ 137 million, including $ 50 million for Credit Suisse bankers, according to documents obtained by regulators.
On Tuesday, Credit Suisse Securities Europe Ltd (CSSEL), a unit of the bank, pleaded guilty to a single charge of conspiracy to commit wire fraud during a hearing in Federal Court in Brooklyn. Parent company Credit Suisse AG also entered into a three-year deferred prosecution agreement with the US Department of Justice.
The settlement includes a criminal fine of $ 247.5 million paid to the United States Department of Justice, which will be reduced to $ 175.5 million after crediting payments to other authorities; $ 100 million paid to the United States Securities and Exchange Commission; $ 200.6 million paid to the UK Financial Conduct Authority; and the cancellation of $ 200 million in debts owed by Mozambique as a result of the loans.
In addition, the bank will appoint an independent third party to review compliance measures for companies in financially weak and high-risk countries, following enforcement action taken by the Swiss Financial Market Supervisory Authority.
“Credit Suisse Group AG, through its British subsidiary CSSEL, defrauded American and international investors in connection with a loan project in Mozambique. Among other things, Credit Suisse AG, CSSEL and their co-conspirators deceived the investors by concealing information about the risk that the loan proceeds could be used for illegal purposes in connection with the restructuring of the loan, ”said the prosecutor. Deputy General Kenneth A. Polite. Jr. of the Criminal Division of the Department of Justice.
In addition, 19 suspects – including Ndambi Guebuza, the son of former Mozambican President Armando Guebuza – are on trial in Maputo on charges of blackmail, embezzlement and money laundering.