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Mozambique Charges Former President's Son, Officials for Secret Debt Scandal

international | crime and justice | press release

Friday August 09, 2019 22:02

by Kate Zeller

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Mozambique charged the former president's son and 19 others on corruption, fraud and blackmail in relation to a $2 billion dollar loan scandal.

Washington DC - Mozambique charged the former president's son and 19 others on corruption, fraud and blackmail in relation to a $2 billion dollar loan scandal.

“Some of the world's poorest people are the victims of the Mozambique debt scandal,” noted United Nations corruption and finance expert Eric LeCompte and Executive Director of the religious development group, Jubilee USA Network. “This behavior is only possible because of a lack of global loan transparency and a lack of public budget transparency in Mozambique.”

In July, former Credit Suisse banker Andrew Pearse pled guilty in US Federal Court for accepting millions of dollars in a fraud scheme that led to the $2 billion Mozambique loan scandal and debt crisis in the East African country. Pearse and six others are accused of taking $200 million in kickbacks. US prosecutors argue that Credit Suisse and Russian-based VTB finance group hid secret loans by bribing bank and government officials. The loans were supposed to support the tuna fishing industry, but instead supported the outfitting of boats as military attack crafts.

Both the US and Mozambique governments also seek to prosecute and extradite former Mozambique finance minister Manuel Chang, currently detained in South Africa.

"The International community must implement standards on public budget transparency and responsible lending and borrowing to prevent future corruption,” said LeCompte. “The people of Mozambique struggle to recover from endemic corruption, a debt crisis and horrific natural disasters."

This year, the southeast African country was hit with two destructive cyclones.

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