BCM TRIAL: WAITING FOR A VERDICT ON MAY 25

1. (SBU) Summary: The verdict in the BCM bank fraud trial
will be handed down on May 25. The case involves nineteen
defendants accused of defrauding fourteen million USD from
the Commercial Bank of Mozambique (BCM) between March and
August 1996. Most commentators do not expect any senior bank
officials to be implicated in the verdict. With preparations
underway for the general election later this year, the
verdict could still hurt FRELIMO, as they strive to present
themselves as effectively fighting corruption. End summary.



2. (U) The Basic Elements of the Case: In this trial,
nineteen defendants including a Maputo BCM branch manager,
numerous other low-level bank employees, the Satar brothers
(who were owners of Unicambios exchange house), and some
Unicambios employees are accused of bank fraud. The Satar
brothers, previously convicted for ordering the murder of
investigative journalist Carlos Cardoso, are also alleged to
be the masterminds behind this fraud scheme. The Satar
family has dual Mozambican and Pakistani citizenship. Momade
Abdul Satar, also known as "Nini," was sentenced last year to
23 years in prison for his involvement in the Cardoso murder.
His brother, Tayobe, fled the country with his parents and
is rumored to be in Dubai or Pakistan. The defendants are
accused of perpetrating fraud involving sixty certified
checks, totaling fourteen million USD, that were cashed at
the branch in question despite insufficient funds. The
branch manager had to override the computer system to allow
the checks to be cashed, and he testified that senior
managers, who were not standing trial, had to endorse the
checks.



3. (SBU) Little Public Attention: The relatively uneventful
BCM trial, which spanned from December 12, 2003, to March 24,
2004, did not provoke the same kind of reaction from common
Mozambicans as the earlier Carlos Cardoso murder trial.
While the trial generated much press coverage, the
Mozambican public has not been following the case nearly as
closely as the Cardoso trial just over a year ago. This is
due in part to the technical aspect of the financial crimes
involved and the public sense that the defendants on trial
did not represent the true high-level political figures
behind the fraud. Once the verdict is handed down later this
month, the next of the big trial in the public eye will be
the Siba-Siba Macuacua murder case, which is likely to prove
more sensational. Macuacua, the Central Bank employee
appointed as the CFO of Banco Austral, was thrown down the
stairwell of the fourteen-story bank building in August 2001
while investigation a similar fraud purported to involve
unpaid loans to senior government officials' family members
and business partners.



4. (SBU) Higher Levels Seen as Untouched: Most observers
cynically expect the trial to result in convictions of the
current defendants, without frying any bigger fish. Among
the board members implicated by the defendants is Teotonio
Comiche, brother of current Maputo mayor and FRELIMO
Political Commission member Eneas Comiche. None of the
senior managers who provided testimony are currently under
investigation, despite attempts by the lawyer for the main
defendant to expose involvement of the well-connected former
board members. The husband of PM Luisa Diogo, prominent
lawyer Albano Silva, is the private prosecutor in the case,
representing the board's interests (BCM has since been merged
into BIM, Mozambique's largest private commercial bank. Many
speculated that Silva's purpose from the onset has been to
shield Teotonio Comiche and his fellow administrator, Augosto
Candida, from prosecution.



5. (SBU) Death Threats and Accusations At The End: After
months of complicated testimony centering on the bank's
procedure, the testimony become more interesting towards the
close. In the last week of the trail, Silva claimed that he
had received numerous death threats on his cell phone.
Additionally, the main defendant Vicente Ramaya, submitted a
list of 69 individuals alleged to have benefited from the
fraud. The testimony involved tales of large sums of cash
being delivered in sports bags, and illicit trips to South
Africa to deliver cash. In his closing statement, "Nina"
Satar accused another BCM board member, Alberto Calu, of
involvement in money laundering and lamented that the senior
managers are too close to FRELIMO to be successfully
prosecuted. For his part, Ramaya explained that at the time
of his arrest in 1996, he was assured that he would be
released on bail, which he was for a small amount. However,
he claimed that his family received death threats. The
dramatic closing arguments of Silva overshadowed those of the
public prosecutor, Ana Maria Gemo. Silva vehemently denied
accusations that he attempted to bribe the judge, and traded
thinly veiled insults with the defense attorneys, including
the accusation that Ramaya's attorney had tried to bribe
Supreme Court Justices who would hear any appeal of the
Cardoso verdict. He reminded the court of the assassination
attempt on him in 1999 and detailed the text messages on his
phone with death threats.



6. (SBU) Comment: The public has been largely disappointed
with the trial and does not expect any surprises when the
verdict is announced later this month. There has been little
live television or radio coverage and the press took some
time to give much play to the story. As opposed to the
Cardoso Murder Trial which seized the country's attention in
2003, the complicated financial transactions at the core of
this case failed to generate much public interest. Presiding
Judge Achifaro Aboobacar will be transferred to the Nampula
provincial court in June. He certainly will not be named man
of the year in the press, as was the judge presiding over the
closely-watched Cardsoso trial.



7. (SBU) Comment Continued: The BCM Trial highlights the
mixed picture of the government's efforts to tackle
corruption. On the one hand, the government did bring this
case to trial prior to elections and allowed unfettered press
coverage -- despite testimony that accused senior government
and party officials of wrongdoing. At the same time, the
case probably only moved forward through donor pressure and
there is little sense that higher political and bank figures
allegedly behind the fraud are likely to be charged.
LA LIME