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Mozambique Debt Probe Sees $500 Million in Unexplained Loans

  • Banks received $200 million in fees for the loans, Kroll says
  • IMF says probe necessary to start negotiating new aid program
Local workers sweep up rice grains and fill sacks in a rice processing plant operated by Wanbao Grains & Oils Co., a Chinese company, in the Limpopo Valley near Xai Xai village, Mozambique, on Friday, March 24, 2017. The granaries and surveillance cameras in this corner of southern Mozambique were part of a wave of Chinese investment in overseas farms and agriculture companies a decade ago that sparked accusations of a land-grab as the Asian country tried to secure enough food for its future.
Photographer: Waldo Swiegers/Bloomberg
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Mozambican state companies have failed to account for about a quarter of the proceeds of $2 billion in loans being investigated, according to a report by Kroll LLC that creditors said was needed for debt restructuring talks to start.

“At least $500 million of expenditure of a potentially sensitive nature remains unaudited and unexplained,” Kroll said in the report, commissioned last year by Mozambique’s attorney general. Credit Suisse Group AG and VTB Bank PJSC were paid almost $200 million in fees for arranging the loans, the New York-based investigator said.