anatomy of corruption

Mozambique’s $2bn corrupt debt: what if there was no trial?

By Olivier Holmey

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Posted on June 28, 2023 14:55

jad20230623-eco-mozambique-dette-cachee-filipenyusi-1256×628-1687509014 Mozambican President Filipe Nyusi, pictured here in 2019, is accused by Credit Suisse and Privinvest of receiving money in the affair. © Armando Franca/AP/SIPA.
Mozambican President Filipe Nyusi, pictured here in 2019, is accused by Credit Suisse and Privinvest of receiving money in the affair. © Armando Franca/AP/SIPA.

The judge in charge of Mozambique’s $2bn corruption case is considering bringing the proceedings to a halt due to a technicality, three months before the trial is due to begin.

The long-awaited trial into Mozambique’s ‘hidden’ debt, which has been in preparation for over four years at the High Court in London, may not go ahead.

That, at any rate, is the purpose of a motion filed by the parties accused by the administration of President Filipe Nyusi.

With just three months to go before the scheduled start of the 12-week trial, merchant banks Credit Suisse and VTB Capital, as well as the shipyard company Privinvest and its owner, the Franco-Lebanese businessman Iskandar Safa (who also owns the French weekly Valeurs Actuelles) have asked the presiding judge in the case to dismiss Maputo’s complaint on the grounds that it is not in order.

Filipe Nyusi personally implicated

The reason for this request is the government’s refusal to follow the rules of English law governing the sharing of relevant documents with the other parties prior to the trial.

The exchange of internal documents is an essential stage in the proceedings, as it should enable both the plaintiff and the accused to be aware of all the elements in the case and thus arrive at the trial on an equal footing. To avoid any hint of opacity, it is up to the lawyers – who have a duty of loyalty to the court – and not their client, to select the documents to be transmitted.

However, Maputo has forbidden its lawyers, the British firm Peters & Peters, from taking this step, preferring to use its own civil servants. This, according to Credit Suisse, is scandalous, accusing Nyusi of entrusting the task to loyal supporters in order to conceal compromising information about him.

The man who has presided over Mozambique since 2015 is personally implicated in this affair, which concerns $2bn of state-guaranteed debt, contracted via Credit Suisse and VTB under the presidency of his predecessor, Armando Guebuza.

These loans, governed by English law, were intended to finance the development of the fishing industry by the subcontractor Privinvest, but were soon tainted by numerous suspicions of opacity and corruption. Mozambique accuses the various players of having bribed members of the government, in particular, the finance minister at the time, Manuel Chang, in order to obtain state guarantees.

These accusations were rejected by Credit Suisse and Privinvest, who in turn accused Filipe Nyusi of having received money at the time of the events, when he was minister of defence.

Defence secrets

The Mozambican government denies any desire to obstruct British justice, while admitting that it was taken by surprise by the level of transparency required by the British court.

According to Maputo, the databases in question, in particular those of the president of the Republic and the country’s intelligence services, are covered by national security. Would the British government authorise a private firm, based abroad, to go through the databases of MI-5 and MI-6, the Crown’s intelligence services, asked Jonathan Adkin, an English lawyer working for the Mozambique government.

This argument was ruled inadmissible by Judge Robin Knowles.

In March, he ruled that Peters & Peters should be authorised to organise the sharing of Mozambican data, and warned that he would not hesitate to dismiss Mozambique’s complaint if the conditions for a fair trial were not met. This harsh ruling was accompanied by a dig at Filipe Nyusi. “I cannot say, at present, whether the president is set on helping these proceedings in the interests of the Republic and its people, or hindering them in self-interest,” the judge said.

Three days of exceptional hearings

Aware of the significance of this warning, several lawyers from Peters & Peters, including the head of the international practice, Keith Oliver, met the Head of State on 5 May while he was travelling in London. They informed him of the court’s criticisms and reminded him of the imperative of transparency imposed by English law, according to a statement consulted by The Africa Report.

However, this high-level meeting did not move the government and the failure to respond has prompted the defendants to ask for the complaint to be dismissed even before the trial begins.

In mid-June, around 50 lawyers were present at a High Court room for an exceptional three-day hearing on this thorny issue. Credit Suisse, VTB and Privinvest argued that Mozambique’s failings were both serious and deliberate.

Criticising the court’s “indulgence” towards Mozambique, Iskandar Safa’s lawyers argued that any “ordinary litigant” guilty of such misconduct would have been dismissed long ago.

Jonathan Adkin, for his part, acknowledged that Mozambique had not met the judge’s expectations, but pointed out that his client had already shared hundreds of thousands of documents with his opponents – proof, he said, of the efforts made by this “underdeveloped and impoverished” state.

The judge’s decision is pending.

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