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Pretoria - Finance Minister Pravin Gordhan has fired a massive salvo at the Gupta family with a high court application which details R6.8bn in suspicious payments allegedly made by the family’s companies.
The application, lodged on Friday afternoon at the North Gauteng High Court, includes a certificate from Financial Intelligence Centre director Murray Michell. It lists 72 questionable payments that the banks reported were made by Gupta companies and in which President Jacob Zuma’s son Duduzane also has a significant sake.
These payments could shed some light on why the country’s major banks closed the accounts of Gupta-owned businesses and why their auditors and JSE sponsor Sasfin terminated their relationships with them.
Gordhan is asking the high court for a declaratory order “in the public interest” that he is neither empowered nor obliged to “intervene in the relationship between” the Guptas, their companies or the banks.
The Guptas have insisted that their accounts were closed “for no adequate reason”.
In his application, Gordhan attaches several pleading letters which Nazeem Howa, CEO of Gupta-owned holding company Oakbay Resources, wrote to him.
In the letters, Howa begs Gordhan to use his “strong relationship with the captains of industry” to help them save their employees’ jobs and convince the four major banks to reopen their accounts.
In his affidavit attached to the application, Gordhan says that in several “direct representations and demands to me as minister of finance ... Oakbay demanded that, on behalf of the government, I intervene with the banks to achieve a reversal of their decisions”.
After another letter from Howa, sent on April 17, which exhorted Gordhan to accept “our unequivocal apology”, Gordhan says he was “concerned to explore any respect in which I could properly, in terms of law, address the situation arising from Oakbay’s serious allegations concerning the banks”.
Gordhan details how he twice sought legal opinion – from Advocate Jeremy Gauntlett and Advocate Frank Pelser – about how he could do this, but they strongly advised him that he, or any other Cabinet minister, could not legally intervene.
“I encouraged Oakbay to ... approach a court. Finally, I requested Oakbay to desist from its attacks on the integrity of National Treasury in the public interest,” Gordhan wrote.
But Howa responded that they too had received legal advice and were told that any court application they launched against the banks would fail.
In June, Gordhan again received word from Oakbay – from Stephan Nel, the CEO of Sahara Computers, a subsidiary of Oakbay – again apologising for negative public statements, but “pressing me to ‘serve the national purpose’”.
Gordhan then received a letter from SA Reserve Bank governor Lesetja Kganyago in which he “raised his independent concerns regarding the deleterious effect on the banking sector of the contentions made by Oakbay”.
But in a statement to M-Net current affairs programme Carte Blanche, Howa let slip that one of the banks had told Oakbay that the reason it closed the companies’ accounts was that it was not allowed to do any business with people or companies it believed could be contravening one or more laws – including the Companies Act, the Prevention of Organised Crime Act, the Financial Intelligence Centre Act and the Prevention and Combating of Corrupt Activities Act.
Gordhan then obtained a certificate from financial intelligence, detailing the more than R6.8bn of suspicious transactions “linked to Oakbay.
“Just one example is the reporting of an amount of R1.3bn as a suspicious transaction – in terms of the Financial Intelligence Centre Act – relating to Optimum Mine Rehabilitation Trust,” Gordhan said.
Other entries on the list include 14 payments made by the Gupta family in their personal capacity, including one of R38m made by Atul Gupta. The document does not mention to whom.
Neither Atul Gupta nor family spokesperson Gary Naidoo could be reached for comment on Saturday.
Alliance at war
Tuesday’s announcement by National Director of Public Prosecutions Shaun Abrahams that Gordhan would be charged with fraud for signing off his former deputy Ivan Pillay’s early retirement, has sent shock waves through the ANC and its alliance partners.
The SA Communist Party (SACP) insists that Zuma must be made to pay if he removes Gordhan from office over an “illegitimate” charge by the National Prosecuting Authority (NPA).
A seething Solly Mapaila, the party’s second deputy-general, told City Press that the political manoeuvrings by “criminal elements” close to Zuma were eroding the “entire movement”.
He said if Gordhan was axed, it would “amount to giving in to this criminal syndicate that wants to hijack our state institutions and movement”.
“This is clear political prosecution. Gordhan is at risk because he is the strategic enemy of the Guptas,” he added.
“To ask him to step aside would be to accept the wool that has been pulled over our eyes. If he is removed, so be it. But the president will bear the consequences of [what happens to] the movement. The ANC will have to accept that.”
The ANC, he said, had already faced the wrath of the electorate, who punished the party in the August 3 municipal elections.
Although Mapaila denied the Gordhan issue featured at the alliance secretariat meeting on Friday, City Press understands the issue was raised but postponed because the ANC was not prepared to answer to it immediately.
Jessie Duarte, the ANC’s deputy secretary-general, attended the meeting without secretary-general Gwede Mantashe, who was in China.
Mapaila said that if Zuma fired Gordhan and replaced him with “someone who will effect decisions that Gordhan has objected to” – in particular, those relating to the SAA and nuclear deals – “it would be clear as daylight whose interests they were serving”.
The SACP had grown critical of Zuma’s failure to distance himself from the Guptas, as well as the ANC’s failure to deal with allegations of state capture.
Outgoing Public Protector Thuli Madonsela was on Friday prevented from releasing her report on state capture following urgent court interdict applications from both Zuma and four-day finance minister Des van Rooyen.
The BBC reported on Friday that Madonsela was in possession of “cellphone evidence” – including SMSes – that placed Van Rooyen at the Guptas’ Saxonwold home the night before his appointment.
Now the SACP is demanding a say in the hiring and firing of government ministers.
Zuma only informed alliance partners of his decision to fire Gordhan’s predecessor, Nhlanhla Nene, as finance minister an hour before making the announcement of his new appointee, Van Rooyen, that caused the country billions of rands in losses.
Mapaila said this was an insult and that Zuma’s consultations with alliance partners was merely cursory.
Mapaila and other SACP leaders and structures will be going to court to support Gordhan when he appears in court on November 2.
ANC asunder
A senior government minister said the party was divided, as some senior leaders believe that Gordhan should be brought to book regarding his alleged role in the formation of the so-called rogue unit at the SA Revenue Service. Others, however, believe that the charges are nothing more than political chess.
“There are those who have, even in our meetings, advocated for his removal and the others in his defence were saying there is no need to do that and to wait for the charges. Now we know the charge and we can see it’s nothing serious. I can say most are behind him,” said the minister.
The minister added that if Gordhan was removed, “it will feed into instability for the country that the ratings agencies don’t like”.
Ratings agencies are expected to revise their assessment of the country’s viability in early December.
“They believe if the country is politically unstable, it can’t meet its targets. That is a threat that is worrying,” said the minister.
If not Gordhan, who?
Among those expected to take over Gordhan’s job following a Cabinet reshuffle are ANC MP Sfiso Buthelezi and Eskom CEO Brian Molefe.
Allegations abounded that Molefe had been preparing to leave Eskom to the point that he even asked Gordhan’s office for information on SAA and the nuclear energy deal.
Van Rooyen faced similar allegations after he arrived at Treasury with two Gupta-linked advisers when he was appointed finance minister.
Molefe could not be reached for comment.
Cosatu says: Butt out of the law
Cosatu, meanwhile, has labelled those who have come out in support of Gordhan – including Deputy President Cyril Ramaphosa, who threw his weight behind him on Saturday – as factional.
Spokesperson Sizwe Pamla told City Press that the Gordhan matter was a legal one.
“Those voices are factional. They operate in a political space. They are not legal experts. Why? What informs that support, what legal advice do they have? What are they going to benefit from taking such a public position?” Pamla said.
Some of the leaders include ANC stalwart Ahmed Kathrada, national executive committee members Max Sisulu, Enoch Godongwana and Jackson Mthembu.
– Hlengiwe Nhlabathi, Setumo Stone, S’thembile Cele and Abram Mashego
