Director Paul Edward Holden from Shadow World Investigations appeared at the Zondo commission. Picture: Itumeleng English/African News Agency(ANA)
Director Paul Edward Holden from Shadow World Investigations appeared at the Zondo commission. Picture: Itumeleng English/African News Agency(ANA)

R49bn paid out in expenditure tainted by state capture, Zondo hears

By Kailene Pillay Time of article published May 24, 2021

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Johannesburg - Over R49 billion has been disbursed by organs of the State in expenditure tainted by state capture, director Paul Edward Holden from Shadow World Investigations has told the Zondo commission.

He estimated the actual amount to be around R49 157 323 233.68, according to his findings.

Holden is giving evidence based on "thousands" of bank statements and transactions.

Evidence-leader advocate Matthew Chaskalson is leading Holden's evidence currently.

Holden has told the commission that his evidence will relate to his report about the known and evidence flow of funds that passed through sometimes complex payment methods to the benefit of the Gupta enterprise.

His report examines the total cost of state contracts afflicted by state capture and the total amounts paid irregularly and directly to the Gupta enterprise by the State.

Holden will also provide evidence on the total amount paid to Gupta enterprise entities by contractors to the state and that secured their own income through an irregular relationship with the Guptas. He said he will also look at the total amount paid to Gupta enterprises in the form of kickbacks, "which has particular relevance to the Transnet 95 100 and 106 locomotive procurement contracts and further crane contracts".

"The operation of a complex local laundromat that received funds from state capture and dissipated it onwards, usually abroad into enormous and complex money-laundering operations in Hong Kong, China and Dubai," Holden said.

Holden said the report would set out the manner in which the Gupta enterprise made use of funds accrued through criminal activity, including how these funds were cycles and used to purchase significant assets such as Optimum Holdings and to ensure the liquidity of the Guptas’ legitimate businesses, such as Sahara Computers.

The commission previously heard from Holden that the fugitive and controversial Gupta family laundered R287 million received for the Estina dairy farm project in a complex manner, to make it appear as if they had tripled the amount.

The Free State Estina dairy farm project was meant to empower emerging farmers in the area.

Holden told the commission that the Gupta family began laundering money through Estina more than a year before the dairy project started. Holden said that the Free State provincial government made the first payment to Estina in June 2012 but the movement of money through the company began as early as May 2011.

”Estina was effectively being used as a front for money laundering by the Gupta enterprise a full year before the initiation of the dairy project,” Holden said previously.

In his evidence, Holden showed the commission how R287m paid by the Free State provincial government into the Guptas’ Estina account was circulated through various Gupta-controlled companies and bank accounts and paid into the dairy project to make it appear there was a total of R880m moving through the account during the life of the project from 2012 to 2016.

The inquiry continues.

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Political Bureau

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