Former Mozambique finance minister extradited to US over $2B fraud scandal News
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Former Mozambique finance minister extradited to US over $2B fraud scandal

South African authorities extradited Mozambique’s former Finance Minister Manuel Chang to the US on Wednesday to face corruption charges. Chang faces faces US criminal charges for his role in a $2 billion fraud and money laundering scheme that nearly crashed Mozambique’s economy and victimized individuals in the US.

Chang together with 19 others—inclusive of state security officials and a former president’s son—face charges of wire and securities fraud as well as money laundering charges. This is due to the disappearance of billions of dollars in Mozambican government-backed loans. Although he denies wrongdoing, evidence shows that Chang signed off on these loans during his 2005-2015 term as finance minister.

Chang has been held in South Africa since 2018 and in May 2019 the Magistrates Court ruled that he was extraditable to the Republic of Mozambique and the US under the Extradition Act No.62 of 1962. Because both the US and Mozambique requested his extradition, diplomatic and court battles broke out over the decision. Ultimately, South Africa’s courts denied Mozambique leave to appeal a final decision regarding their extradition of Chang in May. With that, the decision to extradite Chang to the US was finalized.

The South African Ministry of Justice and Correctional Services confirmed that they successfully surrendered Chang to the US on Wednesday. Chang was scheduled to be arraigned in a federal courthouse in Brooklyn, New York on Thursday.

The US charges are tied to loans obtained from Credit Suisse and Russia’s VTB Bank in a multinational fraud scheme. Under the scheme, bond offerings and loans worth nearly $2 billion were sold as funding to develop Mozambique’s tuna fishing industry. However, investigators say more than $200 million of the money was diverted to pay bribes and kickbacks to foreign officials and former bankers. Furthermore, the Russian VTB bank has since maintained a statement that it had no knowledge whatsoever in the corrupt scheme.

In federal court filings Thursday, US prosecutors requested that the court detain Chang as a “flight risk.” Prosecutors cited the gravity of the charges Chang faces and the alleged $5 million he gained from the fraud scheme as reasons why he should be detained ahead of trial.