Nearly five years after being detained at a South African airport, the former Mozambican finance minister has lost a last-minute judicial appeal and faces extradition to the United States over a $2 billion corruption scandal related to loans to Mozambican state-owned companies.
US prosecutors allege that Manuel Chang, Mozambique’s finance minister from 2005 to 2015, was involved in a scheme that ended up defrauding US and international investors. The huge sums of money loaned to Mozambique by international banks — and guaranteed by the Mozambican government — were intended for a range of maritime projects but disappeared in bribes, kickbacks and other illegal payments, it is alleged.
Chang is accused of taking about $17 million in bribes in the “hidden debts” scandal. He was indicted in New York’s Eastern District Court in 2018.
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The more than $2 billion was supposed to go towards buying warships, building and maintaining shipyards and various other projects to help the country’s fishing industry, but it was never used for those purposes, according to the allegations. The scandal sparked a financial crisis in Mozambique. When the loans were disclosed in 2016, the International Monetary Fund withdrew support for the southern African country.
Chang has been detained in South Africa since December 2018, when South African police arrested him at OR Tambo International Airport in Johannesburg at the request of US authorities before flying to Dubai.
He has filed several lawsuits and appeals in an attempt to avoid extradition to the US.
Chang was left with no legal options in South Africa when the country’s Supreme Constitutional Court denied requests by him and the Mozambican government to appeal a lower court decision that he should be extradited to the US.
Chang and the Mozambican government argued that he should be extradited to Mozambique.
The Constitutional Court delivered the decision on Wednesday and provided a copy of the judgment to the AP on Thursday. In its judgment, the court said that permission to appeal against a decision ordering Chang’s extradition to the US “must be refused” because there was “lack of reasonable prospects of success”.
A Mozambican civil society group, the Budget Monitoring Forum (FMO), backed Chang’s extradition to the United States, arguing in court that he is unlikely to face true justice in his home country.
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In December, several others accused in the scandal were convicted and sentenced in Mozambique. They included Ndambi Guebuza, the son of former Mozambican President Armando Guebuza, who was sentenced to 12 years in prison for illegally receiving around US$33 million in corrupt deals.
Ten other people were found guilty of similar charges and all were sentenced to more than 10 years in prison.
The South African Department of Justice and Chang’s lawyers did not immediately respond to AP questions about when Chang might be extradited to the US.
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In 2021, Swiss bank Credit Suisse agreed to pay at least $475 million to British and US authorities to settle bribery and kickback charges related to the bank’s involvement in the loans.