Kroll commissioned to investigate Mozambique hidden debt scandal

kroll_mozambique
Private investigations company Kroll has been handed the contract to conduct an audit into the three Mozambican companies that borrowed US$2-billion with government guarantees to spend on offshore security and tuna fishing projects – all supplied by Lebanon-based shipbuilding group, Privinvest.

Suspicion has swirled around the three companies – Proindicus, Ematum and MAM – which so far have little to show for the US$2-billion arranged by the London branches of Swiss bank Credit Suisse, and Russia’s VTB Capital.

The deals have led to an acute financial crisis in Mozambique, whose government admitted last week it is in no position to honour the sovereign guarantees.

The IMF has made future lending to Mozambique conditional on conducting an independent, international audit into the deals. The government of Sweden, through its Embassy in Maputo, is funding the process, which has so far been led by the office of Mozambique’s Attorney General.

All three institutions together selected Kroll from a list of five “internationally reputable” companies which applied for the contract.

In a statement on Friday 4 November, the Attorney-General’s Office said that it had requested an audit of the three companies to support its ongoing investigation into whether the law had been broken “in the process of the contracting, financing and functioning” of the three companies, which are owned by the state and by investment firms owned by the Ministry of Defence and the intelligent services.

According to @Verdade, another key issue around these loans is how they (the companies) were spending the more than US$2-billion that was transferred from the Swiss and Russian banks to accounts that have still not been identified, but it is clear that this money did not enter the Mozambican bank accounts of three State-owned companies.

The current Minister of Economy and Finance, Adriano Maleiane, who has

failed to tell the truth in various public statements, said in a hearing in parliament that the amounts of the loans were transferred from banks to the suppliers of the boats and other services and goods that the companies allegedly acquired.

It turns out that, according to the supplier, the French shipyard Mechanical Constructions of Normandy (CMN), the six maritime surveillance boats and 24 fishing vessels only cost approximately US$350-million.

@Verdade also discovered that the construction and installation of a monitoring system for the protection of the coast, which would be run by Proindicus and MAM, cost only US$372-million.

It is regrettable that, evident through the statement of the Attorney-General’s Office, the international and independent audit will only be confined to Proindicus, Ematum and MAM, and not the whole public debt accumulated by Mozambique.

There is evidence that other state companies have borrowed from banks (national and international) with state guarantees, but these amounts are not counted as public debt, as is the case with Aeroportos de Moçambique (AdM) and Linhas Aéreas de Moçambique (LAM).

Kroll will have 90 days from when the contract is signed to produce the report, which the Attorney-General’s Office will make public. The short time-frame scotches rumours that the audit will be allowed to drag on and eventually be buried.
There have also been rumours that two versions will be produced, with the published version declining to name participants who are found to have done wrong.

New York headquartered Kroll is one of the world’s leading investigations companies, and in 2003-04 produced a report for the Kenyan government into corruption by its predecessor regime led by Daniel Arap Moi. The report was suppressed by the government of Mwai Kibaki, which was plagued by corruption scandals of its own by the time the report was completed. It was later published by WikiLeaks.

Source: Zitamar News/@Verdade

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