FIC fines Bank of Baroda R11m

FLOUTING ANTI-CORRUPTION LAWS: AIDED GUPTA DEALS FOR PURPOSE OF BUYING OPTIMUM MINE

Documents show how bank bent over backwards to make the deal happen.

Apart from Deloitte’s report, BOB’s auditor, Nexia SAB&T, also identified several transgressions, stating in its audit report for BOB’s latest financial year that it’s reported several reportable irregularities to the Independent Regulatory Board for Auditors related to the Optimum transaction.

The dash for cash

From the public protector’s October 2016 State of Capture report, and the Deloitte and Nexia documents in Moneyweb’s possession, it’s clear how the Guptas scrambled to raise the necessary funds to acquire Optimum.

In terms of the purchase sale agreement signed between Tegeta and Optimum’s business rescue practitioners (BRPs), the sale was meant to be complete by end March 2016.

In the State of Capture report, Tegeta approached the BRPs on April 11, 2016, and advised it was R600 million short. Eskom’s board approved paying R586.7 million to Tegeta under the guise of “pre-funded coal sales”. It was transferred to Tegeta’s FNB account the next day; R883 million was then sent from this account to Tegeta’s BOB account on April 13, 2016.

Prior to this, Centuar (R885.3 million), Trillian Capital (R65 million) and Trillian Advisory (R47.2 million) also made substantial transfers into the account. As the State of Capture revealed, all three were linked to the Guptas. Aakash Jahajgarhia is listed as a director of Centaur (he married Atul’s niece). Trillian’s sole shareholder at holding company level is Salim Essa, a long-time Gupta associate. Albatime lists Kubentheran Moodley as a director – an advisor to Mines Minister Mosebenzi Zwane.

One more transfer for R10 million came from Albatime on April 14. BOB placed the monies deposited by Centaur, Trillian and Albatime on fixed deposit, took receipt of letters of fixed deposit as collateral from each company, then approved the loans to Tegeta amounting to about R951 million.

Deloitte found BOB didn’t file FIC reports on the deposits made by Tegeta, Trillian, Centaur or Albatime, nor identify related parties.

It also found BOB failed to report the transactions to the FIC, despite them exceeding the prescribed amount for such reports.

BOB also didn’t identify the depositors’ related parties, despite Salim Essa being a shareholder in Tegeta, Trillian, Albatime and Centaur.