NEW YORK — Former Mozambican Finance Minister Manuel Chang was found guilty on Thursday in a financial conspiracy case that arose out of his country’s “tuna bond” scandal and reached in US court.
A federal court in New York handed down the sentence.
Chang was accused of accepting bribes to put his African nation behind bars for large loans to state-controlled companies for tuna fishing vessels and other marine projects. According to prosecutors, the loans were siphoned off with bribes and money laundering, and Mozambique ended up with two billion dollars in “hidden debts,” which led to a financial crisis.
“Today’s verdict is a moving victory for justice and the people of Mozambique who were betrayed by the accused, a corrupt, high-ranking government official whose greed and selfishness sold one of the world’s poorest countries the world’s worst,” Brooklyn US Attorney Breon Peace said in a statement.
Messages seeking comment were sent to Chang’s attorneys and the Mozambican embassy in Washington. Chang was his country’s top finance official from 2005 to 2015.
Chang pleaded not guilty to US conspiracy charges. His lawyers say he is doing as his government wished when he signed a pledge that Mozambique would repay the loans, and that there is no evidence that he has a quid-pro- financial quo for him.
No sentencing date has been set for Chang, 48. The charges carry a possible 20 years in prison, though sentencing guidelines for any given case can vary depending on the defendant’s history and the circumstances. other.
Between 2013 and 2016, three companies controlled by the Mozambican government borrowed $2 billion from major overseas banks. Chang signed guarantees that the government would repay the loans – important guarantees to lenders who might otherwise have shunned the new companies.
The money was supposed to support tuna boats, a marine reserve, Coast Guard vessels and radar equipment to protect natural gas fields along the country’s Indian Ocean coast.
But bankers and government officials looted the loan proceeds to line their own pockets, US prosecutors said.
“The evidence in this case shows you that there is an international scheme of fraud, money laundering and bribery of the highest order here,” and Chang “chose to participate,” Assistant United States Attorney , Genny Ngai, told the judges in closing arguments on Monday.
Prosecutors accused Chang of funneling $7 million in bribes through American banks to European accounts held by an associate.
Chang’s defense says there is no evidence he was actually promised or received a penny.
The only deal Chang made “was to legally borrow money from banks to allow his country to do these public service jobs,” defense attorney Adam Ford said in a statement Monday. .
The companies refused the loans, leaving Mozambique with a debt of two billion dollars, about 12% of the country’s gross domestic product at the time. The country that the World Bank had named one of the 10 fastest growing countries in the world for two decades suddenly fell into financial crisis.
Growth stagnated, inflation rose, the currency lost value, international investment and aid fell and the government cut services. About 2 million Mozambicans were forced into poverty, according to a 2021 report by Chr. Michelsen Institute, a development research group in Norway.
Loans were sold to investors, including tuna bonds. Others dealt with pension funds and pension funds, according to prosecutors.
Investors in the US and elsewhere suffered “significant losses,” Nicole M. Argentieri, assistant attorney general in charge of the Department of Criminal Justice, said in a statement after the decision.
The Mozambican government has reached out-of-court settlements with creditors to pay off some of the debt. At least 10 people have been convicted in Mozambican courts and sentenced to prison over the scandal, including Ndambi Guebuza, the son of former Mozambican President Armando Guebuza.
Chang was arrested at Johannesburg’s main international airport in late 2018, shortly before the US indictment against him and several others was announced. After years of fighting extradition to South Africa, Chang was brought to the US last year.
Two British bankers sued the US, but a jury in 2019 acquitted the other defendant, a Lebanese shipyard executive. The other three defendants, one from Lebanon and two from Mozambique, are not in US custody.
In 2021, the banking giant formerly known as Credit Suisse agreed to pay at least $475 million to British and US authorities over their role in the Mozambique loans. The bank has since been taken over by former rival UBS.
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