Mozambique’s ex-finance minister gets another 2.5 years behind bars in ‘tuna bonds’ corruption case

Author of the article:

The Associated Press

Philip Marcelo

Published Jan 17, 2025  •  2 minute read

FILE - Former Mozambican finance minister, Manuel Chang, is seen in court in Kempton Park, Johannesburg, South Africa, Jan. 8, 2019. Photo by Phill Magakoe /THE ASSOCIATED PRESS

NEW YORK (AP) — Mozambique’s former finance minister has been sentenced to serve another two-and-a-half years in prison by a U.S. court for his role in the ” tuna bond ” scandal that triggered a financial crisis in the African nation.

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Manuel Chang, 69, was convicted last year of accepting payoffs to put his homeland secretly on the hook for about $2 billion in loans from major overseas banks.

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A federal judge in New York on Friday sentenced Chang to eight-and-a-half years in prison, including nearly six years he has already served.

The proceeds were supposed to finance a tuna fishing fleet, a shipyard, Coast Guard vessels and other maritime projects. Instead, prosecutors say, bankers and government officials plundered the funds through bribes and kickbacks.

Chang, who was Mozambique’s top finance official from 2005 to 2015, faces up to 20 years in prison.

In filings ahead of Friday’s sentencing, prosecutors argued for a prison sentence of 11 to 14 years. Chang’s lawyers argued for him to be sentenced to the time he’s already served behind bars.

During the trial, prosecutors said Chang pocketed $7 million in bribes, which they say was wired through U.S. banks to European accounts.

Prosecutors say Chang and other participants diverted more than $200 million, defrauding investors in the U.S. and elsewhere by misrepresenting how the loan proceeds would be used and causing them to suffer substantial losses.

Chang’s lawyers argued that there was no evidence of a financial quid-pro-quo.

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They maintained he was simply doing as his government wished when he signed off on pledges that Mozambique would repay the loans, which were borrowed by three government-controlled companies between 2013 and 2016.

When the companies defaulted, Mozambique was stuck with a $2 billion debt, or roughly 12% of the nation’s gross domestic product at the time.

The “hidden debt” came to light in 2016, plunging the country into financial upheaval.

Nearly 2 million Mozambicans were forced into poverty by some estimates. The government slashed services, growth stagnated, inflation surged, the currency plummeted, and international investment and aid dried up.

Mozambique’s government has been negotiating with creditors for years to pay down the debt.

Meanwhile, at least 10 people have been convicted and sentenced to prison in Mozambican courts over the scandal, including the son of the country’s former president, Armando Guebuza.

Chang was arrested at a Johannesburg airport in 2018, shortly before the U.S. indictment against him and several others became public. After years of fighting extradition from South Africa, he was brought to the U.S. in 2023.

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Follow Philip Marcelo at twitter.com/philmarcelo.

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