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Hidden Debts: “Those Involved Will Be Held Accountable Despite New Out-of-Court Settlement” – PGR

Hidden Debts: “Those Involved Will Be Held Accountable Despite New Out-of-Court Settlement” – PGR

The Attorney General’s Office (PGR) considered this Saturday, 6 July, that the new out-of-court settlement with three banks, including Portugal’s BCP, in the London dispute over hidden debts does not prevent the authorities from holding those involved in the scandal accountable.

“The agreement does not affect the ongoing actions aimed at criminal liability of natural and legal persons, national and foreign, whose illegal acts resulted in the contraction of undeclared debts and the issuing of the corresponding guarantees,” reads a reaction note sent to Lusa today.

According to the statement, the issue is the criticism raised by the Centre for Democracy and Development (CDD) – a non-governmental organisation (NGO) – which considered that the agreement on the hidden debts case, announced on Monday (1), with three creditors harms the state in order to protect leaders of the ruling Mozambique Liberation Front (Frelimo).

“Taking into account the non-recognition of the debts (declared null and void by the Constitutional Council – CC), the CDD believes that the government’s position of entering into negotiations with the creditors is contradictory and undermines the democratic rule of law,” the organisation said in a statement.

In the reaction note sent to Lusa, the Public Prosecutor’s Office, which represents the state in the London court, reiterates that although this is a “complex and winding process, the authorities are working to restore legality”, pointing out that Mozambique has international responsibilities.

During the press conference announcing the agreement on Monday (1), the deputy attorney-general, Ângelo Matusse, explained that the CC’s work on hidden debts was not enough to cancel out the burden that the state was carrying and which was being dealt with by foreign courts, namely English ones.

“You have to realise that the CC’s jurisdiction extends within the borders of national territory. These contracts have clauses such as applicable law and jurisdiction. Both the applicable law and the jurisdiction are English,” emphasised Angelo Matusse during the press conference, adding that “the CC has done its work and this work has supported the internal investigations”.

The new out-of-court agreement was reached with three banks, including Portugal’s BCP, providing for a reduction in “state exposure” from 88.4 billion meticais to 13.9 billion meticais (1.4 billion dollars to 220 million), announced the Minister of Economy and Finance; Max Tonela, during the press conference.

The hidden debts scandal dates back to 2013 and 2014, when the then Finance Minister, Manuel Chang, now in detention in the United States, approved state guarantees on loans from ProInducus, Ematum and MAM to the banks Credit Suisse and VTB, without the consent of parliament.

Discovered in 2016, the debts were estimated at around 170.6 billion meticals (2.7 billion dollars), according to figures presented by the Public Prosecutor’s Office.


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