Credit Suisse Fines £ 350m for Mozambique’s “Tuna Bond” Loan Scandal | Credit Suisse

Credit suisse Global regulators have fined nearly £ 350 million, pleaded guilty to wire fraud and agreed to forgive hundreds of millions of dollars in debt. Mozambique In an attempt to draw a line under the long-running “tuna bond” loan scandal.

Swiss banking companies have been accused of “serious” failures in managing financial crime in the United Kingdom. Financial Conduct Authority (FCA), and after “deceiving US and international investors,” signed a postponed prosecution agreement with the US Department of Justice, which puts banks under close scrutiny for three years.

The monetary settlement paid to UK and US regulators is “Tuna bond” loan scandal that pushed Mozambique into a financial crisis..

This is the bank’s latest attempt to rest a series of scandals under new leadership, and it is still Collapse of Greensill Capital When Archegos Capital earlier this year..

The tuna bond scandal came from a $ 1.3 billion (£ 940m) worth of loan. Credit suisse Arranged for the Republic of Mozambique between 2012 and 2016.

The loan is said to be aimed at government-sponsored investment plans such as the Ocean Security Project in the capital, Mapto, and the state’s tuna fishery.

However, some of the money has not been booked, and at least one of Mozambique’s contractors has at least $ 50 million for Credit Suisse bankers aiming to secure a more lucrative deal on the loan. It was later discovered that he had secretly arranged a “significant kickback” worth $ 137 million. According to the regulatory agency.

International fraud became a snowball, and eventually the International Monetary Fund stopped supporting Mozambique and the country’s economy collapsed.

According to the FCA, Credit Suisse employees have taken steps to deliberately hide kickbacks, but the banks themselves have “sufficient information” to assess potential bribery associated with government projects. Despite having it, I couldn’t properly manage the risk of financial crime in emerging market businesses. ..

“Credit Suisse recognized that Mozambique is a high-risk jurisdiction for corruption of government officials and that the project is not subject to public oversight or formal procurement processes,” said the FCA.

“There have been a number of scrutiny and investigations in the face of sufficient challenges, or key risk factors and warnings within Credit Suisse,” the regulator added.

Credit Suisse will pay US regulators $ 275 million and FCA £ 147 million to settle the proceedings. UK regulators said the number would have been higher if Mozambique did not agree to allow creditors to ow $ 200 million in debt to banks.

“The FCA fines reflect the impact of these polluted transactions, including the debt crisis and the financial harm to the people of Mozambique,” said Mark Steward, managing director of FCA enforcement and market surveillance. rice field.

The bank’s European securities division has also pleaded guilty to one of the transfer frauds in the United States.

A spokesperson for the Attorney General of Mozambique said the country welcomed Credit Suisse’s acceptance of criminal misconduct. “This is an important step in getting complete relief for the people of Mozambique,” he said.

“Note that a criminal trial of a’hidden debt’ scandal in Maputo is underway and has been approved in the context of a civil liability trial listed in London in late 2023.” The spokesman said. Added.

“Through the ongoing criminal charges in Mozambique and the pursuit of civil proceedings in the United Kingdom, the Republic continues to promise to bring responsible persons to trial.”

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Credit Suisse said it expects the settlement to cost $ 230 million in the third quarter.

“We have already taken decisive steps to condemn unjustified observations and strengthen relevant governance and processes,” the bank said in a statement.

“Credit Suisse is pleased with the completion of the US, UK and Swiss regulators’ procedures for bank lending arrangements for Mozambique state-owned enterprises,” he added.

Credit Suisse Fines £ 350m for Mozambique’s “Tuna Bond” Loan Scandal | Credit Suisse

Source link Credit Suisse Fines £ 350m for Mozambique’s “Tuna Bond” Loan Scandal | Credit Suisse

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