Shipbuilder Privinvest Refused Permission to Appeal UK Lawsuit Win in ‘Tuna Bonds’ Scandal

Emirati-Lebanese shipbuilder Privinvest on Tuesday was refused permission to appeal against Mozambique’s victory in a London lawsuit over the decade-old “tuna bond” scandal.

The southeast African country sued Privinvest and its now late owner Iskandar Safa, alleging they paid bribes to Mozambican officials and Credit Suisse bankers to secure favorable terms on three projects in 2013 and 2014, including one designed to exploit Mozambique’s tuna-rich coastal waters.

London’s High Court ruled in July that Mozambique was entitled to payment of just over $825 million from Safa and companies in the Privinvest group, plus an indemnity in relation to $1.5 billion it is liable to pay lenders and bondholders, less around $420 million already recovered by the country.

The court refused Privinvest permission to appeal against that ruling, though Privinvest can apply directly to the Court of Appeal and the company’s lawyer said it intended to do so.

Mozambique’s lawsuit centered on deals struck by state-owned companies with Privinvest for loans and bonds from banks including Credit Suisse for fishing boats and maritime security, projects backed by undisclosed state guarantees.

But hundreds of millions of dollars went missing and, when the government debt came to light in 2016, donors such as the International Monetary Fund temporarily halted support, triggering a currency collapse, defaults and financial turmoil.

Mozambique’s case had also been brought against Credit Suisse, since taken over by UBS UBSG.S, which agreed an 11th-hour settlement with Mozambique in October before reaching a deal with Privinvest during the trial, allowing the lender to draw a line under the scandal.

(Reporting by Tobin; editing by William James and Jason Neely)