Anger boils over Gupta bank accounts

Pravin Gordhan accompanied Deputy President Cyril Ramaphosa to the World Economic Forum in Davos. Gordhan is embroiled in a bitter dispute with controversial Gupta family.

Pravin Gordhan accompanied Deputy President Cyril Ramaphosa to the World Economic Forum in Davos. Gordhan is embroiled in a bitter dispute with controversial Gupta family.

Published Jan 22, 2017

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Johannesburg - The public spat between Pravin Gordhan and the Guptas over the finance minister’s court application alleging that the controversial family was involved in suspicious transactions amounting to R6.8 billion looks set for acrimonious legal wrangling when the matter goes to court.

Gordhan appeared to be smarting from the Guptas’ scathing affidavit on Friday night, as he scrambled, through his legal team, for the best possible way to respond to accusations that he was waging a political agenda against the Gupta family.

In his statement, released almost an hour before midnight, later than promised earlier, Gordhan lashed out at the Guptas for making “sensational” and “politically driven claims” over his court application for a declaratory order as to whether he could interfere with the decision by the country’s major banks to terminate the accounts held with them by the Oakbay group.

Gordhan had, in October last year, made explosive allegations around R6.8bn in suspicious transactions by the Gupta-owned companies when he brought an extraordinary application in the high court in Pretoria asking that he be legally ordered to stay out of the Guptas battle with major banks that closed their accounts.

The transactions may have contributed to four banks closing accounts belonging to the Guptas.

The minister indicated at the time that he did not have the powers to intervene in the decision by FNB, Absa, Standard Bank and Nedbank to shut down the accounts of the Gupta-owned companies.

But in their affidavit in the high court on Saturday, the Guptas said Gordhan’s legal action was motivated by a political onslaught against them.

They accused the minister of conspiring against them with unnamed “captains of industry to clip their wings”, and eliminate the family from South African business.

Gordhan’s court papers, they said, were “superfluous” and “riddled with factual and legal errors”.

In their affidavit, the politically connected family called on the high court to throw away Gordhan’s application for a declaratory order against Oakbay Investments.

The Guptas said there was no basis for Gordhan’s application as they had been running clean businesses in the country in the past 20 years.

They said an internal investigation of the about 72 suspicious transactions had shown that two-thirds of the transactions occurred after the banks had already decided to terminate their relationship with Oakbay.

“The minister’s reliance on the list of 72 purported ‘suspicious transaction reports’ is misplaced, and the minister’s application is supported by a flawed analysis and a faulty factual record,” said acting chief executive of Oakbay Investments, Ronica Ragavan.

The application is backed by affidavits from former Oakbay chief executive Nazeem Howa, Ajay Gupta and other senior employees of the Gupta-owned companies.

Ragavan questioned the timing of Gordhan’s application, saying it gave credence to their suspicion that the minister was targeting the Guptas.

“The application has as its target three businessmen, namely Ajay Gupta, Atul Gupta and Rajesh Gupta, referred to in the popular press as the Gupta brothers,” Ragavan said.

“In January 2016, during a meeting with 60 ‘captains of industry’, the minister, according to sources, elaborated on the Gupta family and said that steps must be taken ‘to clip the wings of this family’ as part of a co-ordinated campaign orchestrated by the minister.”

Last year, when he was supposed to be charged by the Hawks, Gordhan told staff at the National Treasury that he was under attack by the Guptas.

Ragavan said: “The timing of this application, launched a few weeks after these statements on October 14, coincided with the criminal proceedings instituted against the minister and the obvious inference is that this application was his retaliation against the Gupta family (whom he falsely and without any basis believed to be behind his ­criminal investigation by the Hawks).”

The Guptas said last year that they had resigned their positions in the businesses and were contemplating selling their businesses.

Ragavan said Gordhan’s application also coincided with the release of the State of Capture report.

“This application was strategically issued a few days before the hearing of that matter, in order to cloud the issues and further taint the Oakbay group,” she said.

Ragavan also accused Gordhan of conflating state powers, which “would open the floodgates for other weak-kneed political officials who are too scared to take positions on sensitive political and policy matters, and would make the judiciary a maker of political judgements”.

“This application is an abuse of court and an effort to involve the independent judiciary to settle political scores,” she said.

Gordhan said he would respond in detail when he filed his replying affidavit on January 27.

But Gordhan was as scathing of the Guptas as their attacks, claiming that their assertions were designed to deflect the primary issues that were contained in his declaratory order.

“Strikingly Oakbay’s answer in the media statement is that it does not contest the minister’s legal contentions: Yet Oakbay ‘calls on the court’ to refuse a declaratory order, based on legal contentions it concedes it is unable to contest,” Gordhan said, through his spokesperson, Yolisa Tyantsi.

“The minister believes that it is wrong to anticipate the determination of the issues by the court in the way the Gupta-controlled companies seek to do,” he said, adding the court process was to be respected. 

* Additional reporting by Siyabonga Mkhwanazi

The Sunday Independent

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