DURBAN - Gupta-controlled companies whose accounts are being closed by the Bank of Baroda said that they are taking legal action in an attempt to hold off the bank from discontinuing their banking services, according to a report by Moneyweb.
Gary Naidoo, a spokesperson for the Gupta family and their companies, said in an email that many companies that are owned or managed by the Guptas are currently involved in litigation against the Bank Of Baroda.
According to Bloomberg, this is related to its 'unlawful' attempts to close the company's accounts, and given the unreasonable notice date given.
The Bank of Baroda has extended the deadline for the closing of the accounts until the end of September according to Naidoo, but no other bank has offered their banking services.
Four of the big South African banks - FNB, ABSA, Standard Bank and Nedbank - informed Gupta's owned Oakbay that they were cutting their banking services in March 2016.
Also read: Bank of Baroda dumps Guptas
The Citizen reported that the announcement of the closure of banking services in July 2017 left the salaries of employees of Gupta owned ANN7 in jeopardy, with employees questioning whether they would be paid.
At the time the management met with the employees to inform them that they would be paid using brown envelopes if they could not stop the Bank of Baroda.
The Bank of Baroda, an India based company, along with the other companies like auditing firm KPMG and Sasfin Capital have moved away from the Guptas.
KPMG was the auditor of all Gupta-owned businesses but later considered the association with the Gupta’s a risk too great according to KPMG chief executive Trevor Hoole.
-BUSINESS REPORT ONLINE