The Gupta enterprise employed individuals involved in gang activity and was making use of pre-existing and independent criminal networks, the state capture inquiry heard on Tuesday.
The Zondo Commission continued to hear money flow-related evidence from Paul Holden of London-based Shadow World Investigations.
Holden referred to the 2017 murder of “Steroid King” Brian Wainstein to highlight that suspects in this murder like Mathew Breedt and his brother, Sheldon Breedt, were associates of the Guptas. This, Holden said, ultimately underscores the criminality of the Gupta enterprise.
“It is disturbing that the funds ultimately emanate from taxpayers were transitted out of South Africa via the hands of this organised crime network,” Holden said.
Holden had been asked by the commission to describe how the four laundry networks identified in his report operated at the highest level.
Holden said the laundries were “incredibly complicated”, but there was a certain pattern to how they operated.
According to Holden’s testimony, at the very top level, there was a first-level “laundry vehicle” company that received funds from state contractors.
From there, the funds are paid into what Holden called an intermediary account or “high-level laundry vehicle”. The funds were paid into that account from multiple different first-level laundry entities, and then sent onwards in the money laundering network.
The funds were then often sent on to a further party, that further aggregated the funds, and then made those transfers onwards again.
“In most instances where we have been able to trace the funds flowing on to some sort of endpoint, the funds generally end up offshore,” he said.
Holden referred to this in the report as an onshore/offshore bridge.
An onshore/offshore bridge is a company that receives and aggregates payments from this laundry network and then makes payments abroad into a very extended overseas network.
The vast majority of funds identified in this network enter into what Holden called the Hong Kong/China laundry network.
He said hundreds of companies registered in the Hong Kong/China laundry network received money from state capture and then presumably kicked those funds out to an “eventual intended recipient”.
In his evidence, Holden said that Gupta associate Salim Essa owned Hong Kong companies that received kickbacks from China North Rail and China South Rail.
Holden’s evidence revealed how billions of rands were siphoned from the state and into Gupta-linked enterprises through the years of state capture.
While over R49 billion had been disbursed by organs of the state in expenditure tainted by state capture, the Gupta enterprise earned over R16 billion of that money, Holden previously testified.
The inquiry continues.