Three former Credit Suisse bankers have been arrested in London on US charges of alleged involvement in a fraud involving $2bn (£1.6bn) in loans to state-owned companies in Mozambique.
Mozambique’s former finance minister, Manuel Chang, and a senior executive from the shipbuilder Privinvest Group, Jean Boustani, have also been arrested in South Africa and New York, respectively, in recent days.
The action by US authorities came two months after the Serious Fraud Office in the UK abandoned its investigation into the case, a long-running loan scandal that pushed Mozambique into financial crisis when it first emerged five years ago.
The US is seeking to charge the former bankers in connection with conspiracy to violate anti-bribery laws, money laundering and securities fraud.
It is alleged Chang allowed secret loans, ostensibly for maritime investments, into Mozambique without the authority of the government or parliament. The men arrested on Thursday in London were named as Andrew Pearse, Surjan Singh and Detelina Subeva, who were arrested in connection with allegations of defrauding investors.
US prosecutors allege the former Credit Suisse bankers intentionally circumvented antifraud measures set in place by their employer between 2011 and 2013 in order to set up and execute the fraud, while using personal emails to conceal their involvement.
The international scam caused the International Monetary Fund to suspend its assistance to Mozambique, leading to a crash in the country’s economy.
Pearse, Singh and Subeva have been released on bail pending extradition proceedings by the US authorities. If they and others are convicted of violating US anti-bribery provisions they could face fines of up to $100,000 or a five-year prison sentence per violation, in addition to up to 20 years’ imprisonment or a fine of up to $500,000 for money laundering.
In a press release, a spokesperson for Credit Suisse confirmed the involvement of three former Credit Suisse staff: “The indictment alleges that the former employees worked to defeat the bank’s internal controls, acted out of a motive of personal profit, and sought to hide these activities from the bank.”
Confirming no charges have been brought against the bank the spokesperson added: “Credit Suisse will continue to cooperate with relevant regulators following these indictments, and separately looks forward to continuing to work with the relevant authorities to move forward with the proposed debt restructuring.”
Tim Jones, policy officer at the global debt monitor Jubilee Debt Campaign, attacked the UK’s lack of action and said Mozambique should not be expected to repay the loan. “It is scandalous that it has required action from the US authorities for this investigation and arrests to be made in London.
He said: “Credit Suisse should immediately drop its debt claim against the Mozambique people, and call on other owners of the debt to do the same. They should pursue the money from the individuals and banks responsible, not the people of Mozambique.”
He added: “The Mozambique people should not have to repay one cent on a debt they had no say over and no benefit from.”
Omar Remane, from the diplomatic and economic affairs department at the Mozambique high commission in London, confirmed to the Guardian last week that “negotiations in London between the government of Mozambique and its creditors has led to an agreement in principle over 60% of the debt” and that further discussions were under way, an indication that the country would still have to repay its creditors despite the international fraud investigation.