Credit Suisse is sorry not sorry about tuna bonds

Oliver Bullough


When I worked at the Reuters Moscow bureau, I dreaded having to write corrections. We all had pieces of paper pinned to our desks to remind us of the most frequent mistakes – mixing up “billion” and “million”; misspelling the name of one of the many countries we were responsible for; absentmindedly declaring someone to be dead when they were very much alive – but those weren’t the worst errors.

The really embarrassing corrections were those that revealed assumptions we’d had no idea we’d made, such as having called a female politician “he”; or assumed someone with an Anglo name was British rather than Australian. And what made them worse was the fact that colleagues found them hilarious, and would email them around, something that Twitter has super-charged.

Anyway, it is in that spirit of schadenfreude – combined with my distinctly nerdy interest in all things financially criminal — that I appreciated this “clarification” from the Financial Times.

  • “An article on October 20 containing a comment criticizing the U.K.’s Financial Conduct Authority for not taking action against Credit Suisse over the bank’s role in the Mozambique “tuna bonds” scandal went to press before the FCA announced its own settlement with the bank, including a $200m fine.”

Whoops. I feel for the journalists though: 99 times out of a hundred, they’d have been right to assume British agencies would do nothing about a giant corruption scandal and criticize them for it, but this was the hundredth occasion, when the affair was so ginormous that even U.K. authorities took notice of it.

If you haven’t been paying attention to the matter of the “tuna bonds,” this is a good introduction from Richard Messick (formerly of the U.S. Senate, and of the World Bank), who calls it “surely the most egregious corruption offense of the decade.” Sometime around 2010, the Mozambican government teamed up with Credit Suisse, Russia’s VTB and the Franco-Lebanese shipping firm Privinest to secretly issue $2 billion of bank loans and bonds, without seeking approval from parliament. The bonds nominally raised money to create a fishing industry, but much of the money went into kickbacks for everyone involved, and little if any of it ended up in Mozambique. When the scandal was revealed, international lenders including the International Monetary Fund pulled out, plunging the whole country into financial and economic crisis.

  • “The knock-on effects of such a huge corruption scandal may already have cost Mozambique at least $11 billion – nearly the country’s entire 2016 GDP – and almost 2 million people have been pushed into poverty,” according to this joint analysis from Mozambique’s Center for Public Integrity and Norway’s Chr. Michelsen Institute.

To settle that unanticipated action in the U.K., Credit Suisse has paid a financial penalty of 147,190,200 pounds, which is just over $200 million, and would have been far more had it not qualified for a discount (this is the financial criminal equivalent of a parking fine being cheaper if you pay it within a fortnight). Separately, the bank agreed to pay $175.5 million to U.S. authorities under a Deferred Prosecution Agreement.

  • “Credit Suisse, through its subsidiary in the United Kingdom, engaged in a global criminal conspiracy to defraud investors, including investors in the United States, by failing to disclose material information to investors, including millions of dollars in kickbacks to its bankers and a high risk of corruption, in connection with an $850 million fraudulent loan to a Mozambique state-owned entity,” said U.S. Attorney Breon Peace.

Credit Suisse issued a sweeping statement putting the whole matter behind it in a manner that will be distinctly familiar to anyone who’s ever known (or indeed has ever been) a teenager: I already said I was sorry.

  • “The bank condemns any unjustified observations and has already taken decisive steps to strengthen its relevant governance and processes.”

Despite the bank’s determination to Move On, the SEC’s statement contains the present-tense sentence “the FBI is investigating the case” which I would find alarming if written about me (is my dad saying he doesn’t believe my claim to have tidied my room?). Elsewhere, other court proceedings are developing in a fractal manner, with ever more cases spawning out of each other, which will produce years’ worth of employment for lawyers, and perhaps millions more dollars in fines.

A huge trial is under way in Mozambique, featuring – among others – the son of the former president. Manuel Chang, the former Mozambican finance minister, is currently battling extradition from South Africa, while individual Credit Suisse bankers have pled guilty. An employee of the shipping company, however, successfully defeated a U.S. indictment, with his lawyers convincing a jury that the United States had no jurisdiction.

A case will be heard in London in two years’ time, according to this statement from Peters and Peters, the London law firm acting for Mozambique (and which once successfully prevented a film I made about Ukrainian corruption from ever being screened, though that’s another story), to see whether the country should be able to rid itself of the debt incurred by the tuna bonds.

If you want to know why it will take two more years for the case to be heard, take a look at this court judgement from March, and marvel at its complexity. Corruption is incredibly simple in principle, and extraordinarily complex in practice. Being able to understand this stuff is why lawyers get paid so much.

Credit Suisse is still outside the top ten of companies that have paid the most in fines on the new website Violation Tracker (check it out, it’s a database of penalties imposed by UK authorities, based on its U.S. cousin), but this latest ruling should see it move substantially closer.


When they were still interested in me, my kids used to love hearing about how, when I crossed into Turkey from Bulgaria (this was before the government in Ankara knocked six zeros off the currency), I became a multi-millionaire by changing $30 into lira at the border, then went bust by buying some whisky at duty-free. As such, I wonder what Elon Musk’s children like hearing about, since his net worth increased by $36.2 billion the day after Hertz ordered a fleet’s worth of Teslas. By my calculation, that would buy every single bottle of whisky exported from Scotland for the last seven years, which rather puts my handful of dog-eared banknotes, and my solitary bottle of Teacher’s into perspective.

For those of us who haven’t been paying attention, this is a little confusing. It wasn’t that long ago that Hertz had gone bankrupt as the main corporate victim of the pandemic. But history is rattling along very quickly right now, and Hertz is back in business. It’s spending billions on over-priced cars, and Mr. Musk is the beneficiary, because he always is right now.

According to Forbes, Musk is a quarter of the way to being a trillionaire. And, according to various Morgan Stanley clients quoted here, when he makes his trillion, it will be thanks to SpaceX and space-based internet rather than Tesla.

I freely admit to being someone who couldn’t see the point of iPads when they first came out, so I may not be the best person to see the future of new forms of technology. However, a trillion dollars is such an inordinate amount of money, that it’s hard to see how any one person’s business holdings can be worth that much. To put it in perspective, if you had a trillion dollars, and settled down to count them, it would take you more than 30,000 years.

And now, thanks to the curious political folkways of the United States, and the sudden possibility of a wealth tax, we may never find out what a trillionaire looks like. Economists Gabriel Zucman and Emmanuel Saez came up with a plan for a wealth tax in the spring (or, rather, a tax on the unrealized capital gains of billionaires’ wealth), and thought it would raise a trillion dollars from the 1,000 richest people in the United States. (Billionaires’ wealth has increased  around 10% since April, so adjust estimates accordingly, Zucman has since tweeted), and it’s apparently being seriously considered by Democrats in Congress, who found a higher corporation tax unpalatable.

  • “From a distance, this can seem like someone at the bar turning down a beer because they don’t drink, and then asking for a shot. But, in fact, politically and economically, this makes a great deal of sense,” wrote Anand Giridharadas. “In a country where millions of people are under the illusion of being millionaires-in-waiting, tax increases on the broad class of the rich scare many thousandaires away. But a wealth tax concentrated on fewer than 1,000 plutocrats has wide appeal.”

Wouldn’t it be great?


I normally like to hope that Britain and the United States have emerged from the political hyper-partisanship of the Trump and Brexit years, bruised but essentially unscathed, but I keep reading things that show that is not the case at all. I was particularly struck by this article by Alexandra Hall Hall, a veteran British diplomat and former ambassador in Georgia, who quit in 2019 because she couldn’t stand telling half-truths for the government any longer.

  • “I find my position has become both unbearable personally, and untenable professionally. I am also at a stage in life when I would prefer to do something more rewarding and meaningful with my time, than peddle half-truths on behalf of a government I do not trust,” she wrote, in her resignation letter.

It is a generous and compassionate article and makes no judgments about people who did not follow her lead and quit, but it is also an alarming one for an outsider.

  • “Should those concerned about the quality of governance in the United States and the United Kingdom worry more about the civil servants who resign, or more about the ones who do not — those who are willing to continue implementing policies, despite believing, or knowing, that they are wrong?” she asks.