Jailing ‘fraudsters’ won’t recover lost money – Chissano

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Former Mozambican President Joaquim Chissano has weighed into the ongoing fraud investigation over the loss of $2bn (£1.5bn).

Mozambique authorities have named 17 people alleged to be involved in the scandal, including former Finance Minister Manuel Chang.

Mr Chang, who is fighting a US extradition request in South Africa where he was arrested in December, denies any wrongdoing.

US prosecutors say that through a series of financial transactions between approximately 2013 and 2016, Mr Chang and others created fraudulent maritime projects and used state-owned companies in Mozambique as fronts to raise $2bn.

Some of the investors defrauded included US nationals, the indictment says.

It added that they “intentionally diverted portions of the loan proceeds to pay at least $200m in bribes and kickbacks to themselves, Mozambican government officials and others”.

The state-owned companies missed more than $700m in loan payments after defaulting in 2016 and 2017, the indictment adds.

Mr Chissano said jailing those involved would not be worth much if the money was not returned.

He urged the Mozambique’s justice department to work with the US and South Africa authorities to ensure the money was returned.

“If there’s any money it should be returned to Mozambique. This would be useful. Now, I don’t know which strategy to use to return the money. But, if the person is imprisoned, he may not have means to repatriate the money.”

 “What is essential here is that Mozambique will learn a lesson for the future and create a much pure society.”

 

Mozambique’s government revealed in 2016 that it had taken undisclosed loans, prompting the International Monetary Fund (IMF) and foreign donors to cut off support.

This triggered a currency collapse and a default on Mozambique’s sovereign debt. It is still struggling to overcome from the debt crisis.

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