Ex-Mozambique Minister Convicted in $2B 'Tuna Bonds' Fraud Case

In a significant legal development, Manuel Chang, the former finance minister of Mozambique, has been convicted by a US court for his role in a $2 billion fraud case known as the "tuna bonds" scandal. The verdict, delivered on August 8, 2024, in a federal court in Brooklyn, New York, found Chang guilty of conspiracy to commit wire fraud and money laundering.

The case revolves around loans totaling $2 billion, intended to develop Mozambique's fishing industry and enhance maritime security. These funds, provided by Credit Suisse and Russian bank VTB, were allegedly misappropriated through a complex scheme involving state-owned companies and the shipbuilding firm Privinvest.

Prosecutors assert that Chang received $7 million in bribes from Privinvest in exchange for approving government guarantees for the loans. The funds were allegedly deposited into a Swiss bank account controlled by an associate, with other Mozambican officials communicating with Privinvest to conceal Chang's involvement.

The collapse of the projects and subsequent loan defaults had severe consequences for Mozambique, a country still recovering from a 16-year civil war that ended in 1992. The scandal led to a temporary halt in support from international donors, including the International Monetary Fund, triggering a currency crisis and financial instability in the nation of approximately 31 million people.

"Today's verdict is an inspiring victory for justice and the people of Mozambique."

The case has broader implications for Mozambique's economic development. Despite possessing vast natural gas reserves discovered in 2011 and significant mineral resources, including coal, the country continues to face challenges in leveraging its natural wealth for sustainable growth.

This verdict comes amidst a series of related legal proceedings. On July 29, 2024, Mozambique won a substantial portion of its $3.1 billion lawsuit against Privinvest in London's High Court. Additionally, Credit Suisse, now part of UBS Group, agreed to pay $475 million in 2021 to settle bribery and fraud charges related to the case.

Chang's defense team, led by lawyer Adam Ford, has announced plans to appeal the verdict. They argue that Chang approved the government guarantee under presidential directive and contest the evidence linking the $7 million to their client.

As Mozambique grapples with the aftermath of this scandal, the country faces the challenge of rebuilding trust with international partners and investors. This case underscores the importance of transparency and accountability in managing natural resources and development projects in emerging economies.