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Alleged Gupta ‘letterbox’ sees ‘laundered’ R14.5m forfeited to the state

By Matthew le Cordeur

Cape Town – The South African Reserve Bank announced it would forfeit about R14.5m belonging to Homix to the state, three days after amaBhungane reported how it appeared to be a Gupta letterbox company in December.

Gupta brothers

A letterbox company is a firm set up with the intention of circumventing legal and conventional obligations, website stopletterboxcompanies explains. “Examples of these are taxation, social security, VAT and wages. These companies do not actually perform any real economic activities although claiming to do so.”

For more than a year, amaBhungane investigated how Homix “secreted away hundreds of millions; apparent kickbacks from companies doing business with Transnet, the state-owned transport operator”, according to Huffington Post, which published the investigative story on December 8.

Three days later, deputy Reserve Bank governor Kuben Naidoo signed an order forfeiting money Homix held in Mercantile Bank to the state. The order was published in the government gazette on December 30 2016, the day the money – R14 472 075 – and any interest was seized.

“The money specified…shall be disposed of by deposit thereof to the National Revenue Fund,” Naidoo ordered.

Mercantile Bank is aware of the notice gazetted by the Sarb, it said in a statement in response to questions by Fin24.

“Mercantile complies fully with the South African Reserve Bank and Financial Services Board rules and regulations governing financial institutions and will comply with the order of forfeiture, in compliance with the applicable provisions of the Exchange Control Regulations.”

Must read: Gupta family says: ‘We will not run away’, promises to fight SA banks to bitter end

It added that as a bank, it is bound by client confidentiality rules which prohibits the divulging of client information.

Stefaans Brümmer, Susan Comrie and Sam Sole of amaBhungane reported that papers filed in the high court in Johannesburg provided direct evidence of Gupta involvement in Homix.

“After Homix was exposed, a seemingly round 10% of the first year’s fee on another big Transnet contract flowed to Gupta-owned TNA Media,” they explained.

“The amount, R17.1m, was allegedly laundered through two companies on the strength of a backdated contract and bogus invoices before arriving at TNA, which publishes The New Age, court papers show.” – News24

Source: http://www.fin24.com/Companies/Financial-Services/reserve-bank-forfeits-r145m-from-alleged-gupta-linked-firm-20170103

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