Last June 3, 2020, the United Bank for Africa (UBA) initiated legal action against entities of Credit Suisse over the scandal of misappropriated loans in Mozambique. According to information consulted by Ecofin Agency, the Lagos-based banking group had participated in the transaction of a syndicated loan in Mozambique and the loan is now subject to lawsuits in the U.S. and the UK for misappropriation practices.

UBA Group is seeking compensation for losses it would suffer if Mozambique withdraws its sovereign guarantee on the syndicated loan to the local company ProIndicus. On October 27, 2020, the Mozambican government filed an appeal seeking a declaration that the sovereign guarantee issued for the transaction was void. Another shareholder of ProIndicus, namely Banco Internacional de Moçambique, has also filed an appeal for the same reasons.

Credit Suisse filed its defense in response to UBA’s legal action on July 1, 2021, but no further details are known at this time. This information comes at a time when, according to Bloomberg, the Swiss financial group is negotiating a deal with the U.S. justice system for the proceedings that are underway in this case. Credit Suisse has made known in a document made available to the public that it is in permanent discussions with regulators and authorities who are investigating the three points of the case, notably the loan to ProIndicus (which is the subject of the misappropriation), the distribution of an information note to private investors on this loan and another note on a Eurobond issued by Mozambique in same the wake.

U.S. prosecutors had indicted three former Credit Suisse bankers and Mozambique's former finance minister, Manuel Chang, on fraud and money laundering charges over the scandal. According to the indictment, Mr. Chang and the bankers “created the maritime projects as fronts to raise money to enrich themselves and intentionally diverted portions of the loan proceeds to pay at least $200 million in bribes and kickbacks to themselves.” The three bankers pleaded guilty.

Idriss Linge