Next week, the case that Mozambique has brought against Credit Suisse in the «Tuna Bonds» scandal goes to trial in London. UBS is pushing for a settlement.
Legal disputes, scandals, and financial affairs are making for difficult times in Swiss banking, and damaging its reputation. The US judiciary is expanding its investigations against Credit Suisse and UBS, while in France, UBS is facing a heavy fine in a tax dispute.
On top of that, further trouble looms for UBS, which, after the takeover of Credit Suisse, has to answer for its former competitor's legacy. Next week, a 13-week trial begins in London's High Court in the case brought by Mozambique against Credit Suisse.
Last week, the UK Supreme Court allowed the trial to proceed, in which the African country is seeking around $1.5 billion in damages.
Process Rolls On
UBS is said to be attempting to reach a last-minute agreement with the government of Mozambique to avoid a protracted legal battle over Credit Suisse's involvement in a $2 billion «Tuna Bond» scandal. Lawyers for UBS are pushing for a settlement, the «Financial Times» (behind paywall) reported, citing people familiar with the case.
Meanwhile, lawyers representing Mozambique in London are ready to start the process on Monday, another person familiar with the matter said, according to the «FT.» In June Credit Suisse failed in its attempt to have the lawsuit dismissed.
Cautionary Case
The Mozambique case is part of one of the biggest corruption scandals in Africa. Credit Suisse was among the banks that arranged $2 billion in loan financing between 2013 and 2016 for the expansion of Mozambique's shipping fleet and tuna industry, among other projects. But the money seeped away in an elaborate bribery and kickback scheme, according to allegations by US authorities.
That plunged the African country into a severe financial crisis. The case is also a cautionary tale about the hidden risks of lending to poor countries.
