UK watchdogs, FBI probe Gupta dealings

The controversial Gupta family, their associates and President Jacob Zuma could be facing UK and US authorities who are investigating claims of money laundering through bank accounts and various firms.

This is a game changer as law enforcement agencies such as the FBI in the US and the UK’s Financial Conduct Authority, National Crime Agency and Serious Fraud Office have huge resources. Once a person is on their radar, there is little chance of evading them.

This also comes after months of inaction by South African authorities to bring those implicated in allegations of state capture to book.

UK authorities were investigating allegations around the Gupta family’s use of UK banks in Dubai and Hong Kong to aid them in laundering South African taxpayers’ money.

Meanwhile, the FBI and the US department of justice are conducting a joint investigation into the Gupta brothers and their relatives living in the US under that country’s Foreign Corruption Practices Act. They are also investigating them for money laundering.

Business Day understands that US and UK authorities have begun preparations to seize bank accounts and confiscate properties linked to the Guptas’ relatives living in those countries, and which are believed to have been bought with the alleged kickbacks.

The UK probe follows House of Lords peer and anti-apartheid activist Peter Hain’s letter to UK Chancellor of the Exchequer Philip Hammond in September, asking him to urge law enforcement agencies to track down about R7bn thought to have been laundered through the Guptas’ networks, and ensure it was returned to SA’s Treasury.

Hain spent his childhood in SA until his parents were forced into exile in 1966. “People who are part of the investigation [in SA] are involved in state capture.” He said persons at high levels of the ANC and elsewhere had asked him to initiate the British probe.

Hain specifically asked that HSBC, Standard Chartered and the Bank of Baroda be probed. He said whistle-blowers in SA had told him these banks had been or still were conduits for corrupt proceeds. He has listed 28 names including the Guptas, President Jacob Zuma, his sons Duduzane and Edward, daughter Duduzile, wives Bongi Ngema-Zuma and Thobeka MadibaZuma and former wife Nkosazana Dlamini-Zuma.

Others on the list were suspended Eskom chief financial

officer Anoj Singh, the utility’s former CEO Brian Molefe and Gupta associate Salim Essa.

Some of those named were on the list because of their proximity to Zuma and the Gupta brothers and not for being implicated in the allegations of state capture. Hain said alleged illicit funds might have passed through the United Arab Emirates and Hong Kong, where HSBC and Standard Chartered have a presence.

Standard Chartered told Reuters it was unable to comment on client transactions, but said it had closed accounts linked to the Guptas in 2014. This was two years before banks in SA closed the family’s accounts. HSBC declined to comment.

Ajay, Atul and Rajesh Gupta are alleged to have stolen about R140m with the apparent help of their nephews Amol and Ashish Gupta, who are US nationals.

This was allegedly done through at least two deals relating to a government farming project and Transnet. An e-mail seen by Business Day shows that in May 2014, Ashish Gupta wrote to Accurate Investments, whose accounts were held by Standard Chartered, demanding that the company honour an agreement to pay him $10m. He instructed the company to pay the money into a New York account that is held by US medical consulting group, Brookfield Constants Inc.

The e-mail was sent shortly after $2m was wired to Ashish and Amol’s New York bank account. According to the Financial Times, tax records in Texas name Ashish and Amol as directors of Brookfield.

The paper reported that Brookfield had received payments to a US bank account from Accurate Investments.

Hawks spokesman Brig Hangwani Malaudzi said the agency would co-operate with any request received from its international counterparts.