Mozambican former finance minister’s detention is legal, says judge
Manuel Chang is accused by US authorities of conspiracy to commit wire fraud, securities fraud and money laundering
09 January 2019 - 13:27
byagency staff
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Mozambique's former finance minister Manuel Chang appears in court during an extradition hearing in Johannesburg, on January 8 2019. Picture: REUTERS/SHAFIEK TASSIEM
A judge ruled on Wednesday that the detention of Mozambican former finance minister Manuel Chang over $2bn of fraudulent loans is legal.
Lawyers for Chang, who was arrested in SA on December 29 and denies any wrongdoing, argued in the Kempton Park Magistrate's Court on Tuesday that his detention on US charges was illegal because a request for extradition had not yet been received.
AFP reported on Tuesday that Chang made a brief court appearance after being arrested at OR Tambo International airport over alleged secret loans to Mozambican state companies. Since his arrest, three former employees of Credit Suisse bank have also been arrested in London.
Chang, who was finance minister between 2005 and 2015, is accused by US authorities of conspiracy to commit wire fraud, securities fraud and money laundering.
Between 2013 and 2014, Mozambique state-owned security companies borrowed about $2bn, but the government only disclosed most of the debt to the International Monetary Fund (IMF) in 2016. The hidden debt plunged Mozambique into its worst financial crisis since independence in 1975.
“Detention of Mr Chang is illegal because his arrest was effectively on terms of an ineffective warrant,” Willie Vermeulen, Chang’s lawyer, told the court on Tuesday.
Public prosecutor Elivera Dreyer applied for the case to be postponed. Judge Sagra Subroyen agreed, saying she would hand down a ruling on Wednesday.
US prosecutors allege that Chang received $12m to agree to signing the loan agreements. About $200m was spent on bribes and kickbacks, according to the US indictment. Chang did not speak during Tuesday's hearing.
Mozambique’s attorney general said on Monday there were 18 defendants in their own investigations into the case, but no convictions have been made since the scandal was unearthed in 2015.
In addition to Chang, two other unnamed Mozambican citizens are accused by US prosecutors of being involved in fraud related to the $2bn debt. Lebanese businessman Jean Boustani, accused of helping co-ordinate the alleged fraud, was arrested at a New York airport on January 2.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Mozambican former finance minister’s detention is legal, says judge
Manuel Chang is accused by US authorities of conspiracy to commit wire fraud, securities fraud and money laundering
A judge ruled on Wednesday that the detention of Mozambican former finance minister Manuel Chang over $2bn of fraudulent loans is legal.
Lawyers for Chang, who was arrested in SA on December 29 and denies any wrongdoing, argued in the Kempton Park Magistrate's Court on Tuesday that his detention on US charges was illegal because a request for extradition had not yet been received.
AFP reported on Tuesday that Chang made a brief court appearance after being arrested at OR Tambo International airport over alleged secret loans to Mozambican state companies. Since his arrest, three former employees of Credit Suisse bank have also been arrested in London.
Chang, who was finance minister between 2005 and 2015, is accused by US authorities of conspiracy to commit wire fraud, securities fraud and money laundering.
Between 2013 and 2014, Mozambique state-owned security companies borrowed about $2bn, but the government only disclosed most of the debt to the International Monetary Fund (IMF) in 2016. The hidden debt plunged Mozambique into its worst financial crisis since independence in 1975.
“Detention of Mr Chang is illegal because his arrest was effectively on terms of an ineffective warrant,” Willie Vermeulen, Chang’s lawyer, told the court on Tuesday.
Public prosecutor Elivera Dreyer applied for the case to be postponed. Judge Sagra Subroyen agreed, saying she would hand down a ruling on Wednesday.
US prosecutors allege that Chang received $12m to agree to signing the loan agreements. About $200m was spent on bribes and kickbacks, according to the US indictment. Chang did not speak during Tuesday's hearing.
Mozambique’s attorney general said on Monday there were 18 defendants in their own investigations into the case, but no convictions have been made since the scandal was unearthed in 2015.
In addition to Chang, two other unnamed Mozambican citizens are accused by US prosecutors of being involved in fraud related to the $2bn debt. Lebanese businessman Jean Boustani, accused of helping co-ordinate the alleged fraud, was arrested at a New York airport on January 2.
Reuters and AFP
Mozambique bribe claims could void debts, says professor
Bail hearing in SA for former Mozambican official postponed
Ex-Credit Suisse bankers arrested on US charges over Mozambique loans
Mozambique’s former finance minister to fight US extradition request
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Related Articles
Maputo’s massive infrastructure facelift
Mozambique lands good terms on $726.5m Eurobond restructuring
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.