The company Kroll Associates, which carried out the audit into the three Mozambican security-related companies which contracted loans of over two billion US dollars from European banks, has suggested that the British authorities take action against one of the banks involved, Credit Suisse.
This is one of Kroll’s recommendations which is in the full text of its audit report. So far only the executive summary has been published – but the well-informed bulletin “Mozambique News Reports and Clippings”, published in London, has seen the recommendations in the full report.
According to the bulletin, “Kroll suggests that Credit Suisse may have violated British Law by failing to undertake an adequate due diligence enquiry on the loans.” It calls on the Mozambican Attorney General’s Office (PGR) to “request, under the Mutual Legal Assistance arrangements in criminal matters, that the UK Authorities request the details of enhanced due diligence documentation from Credit Suisse.”
Kroll also calls on the PGR to formally request the Mozambican State Security and Intelligence Service (SISE) to provide all such documents. It says both Credit Suisse and SISE have so far refused to provide any information on the due diligence.
The SISE officer who is the chairperson of all three companies (Ematum, Proindicus and MAM), Antonio do Rosario, openly sabotaged the audit, and boasted, in a message circulating on social media, that he had thrown the Kroll auditors out of his office. Rosario, referred to in the report as “Person A”, is one of those who refused to say what due diligence, if any, had been undertaken.
The relevant UK agency is the Financial Conduct Authority (FCA). Kroll’s view that the apparent failure of Credit Suisse to do an enhanced due diligence investigation constitutes a criminal matter will increase the pressure on both the FCA and the bank.
In the full report, which the Bulletin says is considerably stronger than the summary, Kroll states: “Credit Suisse, as a UK financial institution, has an obligation under the UK Money Laundering regulations to undertake enhanced due diligence where there is the prospect of Politically Exposed Persons (“PEPs”) being a party to the financial transaction”.
It adds that “Further, Credit Suisse has an obligation under the UK Money Laundering regulations to establish the Ultimate Beneficial Owner(s) of the Mozambique Companies.”
Credit Suisse is regarded as a British institution because the loans were arranged through its London branch.
Kroll warns of the “risk” that “Credit Suisse has not undertaken adequate due diligence” and that loans may have been used “contrary to stated purpose”.
The report states that “the Mozambique Companies, despite repeated requests, have not provided Kroll with any evidence that comprehensive due diligence was undertaken to assess the suitability of the Contractor(s) for the Mozambique Project.” The “Contractor” is the Lebanon-based Privinvest Group. The group includes Privinvest Shipbuilding and Abu Dhabi Mar, which owns the shipyard in Cherbourg where the boats for Ematum and Proindicus were built.
Kroll called for a review of “all existing contracts” with the Privinvest Group, because the involvement of Privinvest companies in structuring the project and arranging the loans means there is a risk that the contracts are “disadvantageous” to Mozambique.