Baroda and the Oakbay links are ‘still intact’
Guptas say it’s business as usual despite rumours
THE banking relationships between the businesses of the Gupta family and India’s Bank of Baroda are still intact.
There is no basis to the speculation that the Indian bank would close the accounts of the Oakbay group of companies at the end of March, according to Victoria Geoghegan of Bell Pottinger, which speaks for the Oakbay group.
Further, she says Oakbay is still able to facilitate the payments of salaries and other expenses through Baroda.
“All of Oakbay’s accounts are still open and Oakbay is grateful to Bank of Baroda for its continued support,” Geoghegan said this week. And there is no deadline for the termination of the relationship.
“Media constantly cite unnamed sources and talk about rumours, but ignore the facts,” Geoghegan says.
Oakbay Investments and its group of companies, including Oakbay Resources and The New Age newspaper, are still paying their expenses and suppliers through Baroda, says Gert van der Merwe, the lawyer representing the family and its businesses.
“My clients are not aware of the Bank of Baroda closing their accounts. My own invoices are still getting paid through the bank,” Van der Merwe says.
Though Oakbay remains banked, both Geoghegan and Van der Merwe lament the difficulty of conducting business through a small bank without much physical presence in SA. The Bank of Baroda has only one branch in the country.
“Obviously, not being banked with one of the major banks in SA, with full clearing facilities, is very damaging to Oakbay and this situation cannot persist in perpetuity,” Geoghegan says.
For Baroda to transfer payments to Oakbay’s 7 500 employees and suppliers, it must first latch onto the payments systems of the local commercial banks, who last year closed the accounts of the Gupta family and its companies. The commercial banks cited the reputational and regulatory risk posed by alleged irregular payments going through the accounts as one of the reasons for terminating their relationships with the Gupta family businesses.
That Baroda is able to enter the SA payments systems through the commercial banks means the Gupta family has managed to come in through the back door, obtaining an indirect relationship with the banking system.
While the Gupta businesses, through Bell Pottinger, are quite happy to enlighten the public on their banking woes, they are not as forthcoming about the Gupta family’s relationship with new finance minister Malusi Gigaba.
Geoghegan is quick to disown responsibility for commenting on Gigaba’s relations with the Gupta family, saying she speaks only for the commercial interests, not members of the family.
Van der Merwe only represents the Guptas on legal matters and litigation, he says.
Through Oakbay Resources’ uranium mining company, Shiva Uranium, the Gupta family hopes to cash in if SA goes ahead with the procurement of nuclear power stations.
President Jacob Zuma is regarded as supporting the start of the procurement process before his term of office comes to an end in May 2019.
Last month’s costly dismissal of finance minister Pravin Gordhan, who firmly and vigorously opposed any rush to invest in projects that the state cannot afford, is linked to this ambition. — TMG