U.S. Identifies Key Mozambique Officials in Unsealed Indictment

(Bloomberg) -- The U.S. Department of Justice identified a former senior Mozambican intelligence official and an ex-employee in the office of the president in an indictment alleging they used more than $200 million of state funds for bribes and kickbacks.

The charges stem from a scandal involving $2 billion of loans the government raised in 2013 and 2014 and the bulk of which it hid from the International Monetary Fund and other donors. That led to a financing freeze when the debt was uncovered two years later. The government has missed payments on the obligations, as well as its $727 million of Eurobonds, since early 2017, as it sought to restructure them.

“The indictment unsealed today alleges a brazen international criminal scheme in which corrupt Mozambique government officials, corporate executives, and investment bankers stole approximately $200 million in loan proceeds that were meant to benefit the people of Mozambique,” Assistant Attorney General Brian Benczkowski said Thursday in a statement.

The DOJ indictment identified Antonio do Rosario, who was an official in the state intelligence service and the former chairman of the three state-owned companies that contracted the loans, among the defendants. It also said Najib Allam, chief financial officer of shipbuilder Privinvest Group, and Teofilo Nhangumele, who acted on behalf of former President Armando Guebuza’s office, should face charges.

Do Rosario and Nhangumele’s lawyers didn’t immediately respond to requests for comment. Both men were arrested by the Mozambican authorities last month. Privinvest declined to comment.

The three men bring to eight the number of individuals who’ve been identified as defendants in the case. They include three former bankers at Swiss lender Credit Suisse Group AG, the lead arranger for two of the loans, ex-Privinvest salesman Jean Boustani and former Mozambican Finance Minister Manuel Chang.

Mozambican authorities arrested Do Rosario and Nhangumele last month, along with others including Guebuza’s son and his private secretary. Boustani was detained in the U.S. in January, while Chang is facing extradition to the U.S. from South Africa, where he was arraigned in December.

©2019 Bloomberg L.P.