The tentacles of the Gupta family stretch deep into South Africa’s state entities, it seems, with fresh allegations emerging almost daily about irregular transactions involving taxpayers’ funds. The Guptas and their businesses repeatedly deny any wrongdoing, yet more people are testifying through court documents to questionable deals. This week, a top team of investigative journalists at the amaBhungane centre, have pieced together details through various court documents, which once again highlight the links between Gupta entities and transactions involving state entities. There are allegations of kickbacks and moneylaundering. A name that is cropping up with increasing frequency is that of Eric Wood, chief executive officer of Trillian Capital Partners. A whistleblower at his company went into hiding after reporting to the Public Protector that her Trillian colleagues knew that finance ministers were about to be switched because they had the inside track. That political manouevre, called #Nenegate, sent ripples through financial markets and there is speculation there may have been benefits for currency traders in the know. Wood denied any knowledge that #Nenegate was looming, just as he has denied the latest story put out by amaBhungane. Trillian’s chairman is Tokyo Sexwale, a respected former ANC struggle veteran who spent time with Nelson Mandela at Robben Island prison. Sexwale promised to get to the bottom of the earlier #Nenegate allegations; these latest revelations will undoubtedly give him more pause for thought. Sexwale will be wondering whether he has got into bed with the right partners at Trillian. Although financial services provider Trillian describes Wood as “the greatest trading star in South Africa”, being linked to state capture can’t be good for business when the proverbial chickens are coming home to roost. – Jackie Cameron
A team of investigative journalists has published a report containing explosive allegations that link Eric Wood, the head of asset management and financial services company Trillian Capital Partners, to irregular financial transactions. They allege that Wood helped entities linked to the Gupta and Zuma families to launder kickbacks from companies doing business with state-owned transport operator Transnet.
AmaBhungane, the not-for-profit Centre for Investigative Journalism, has tracked the flow of money, drawing on papers filed in the High Court in Johannesburg and piecing together links with earlier reports.
Reporting on its website, amaBhungane says it has been investigating a letterbox company called Homix, which has allegedly secreted away hundreds of millions; apparent kickbacks from companies doing business with Transnet.
There were signs all along that this had something to do with the Guptas, say the journalists, highlighting that some of the money flowed to a Hong Kong firm that shared an address with a Gupta lieutenant’s companies.
“Now, papers filed in the High Court in Johannesburg have provided direct evidence of Gupta involvement: 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.
“The amount, R17,1 million, 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,” says amaBhungane.
While the amaBhungane investigation focuses on the nuances of deals involving Neotel, it also puts the spotlight on Trillian Capital Partners – which ANC struggle veteran and businessman Tokyo Sexwale chairs. Trillian CEO Eric Wood is allegedly named in court papers as a key figure in helping to process kickbacks for Gupta entities.
Recently Sexwale ordered an investigation into allegations that Eric Wood knew about #Nenegate before it happened. #Nenegate is a reference to the surprise switching of finance minister in December last year, which resulted in rand volatility – and speculation that some players might have benefited from currency moves.
Des van Rooyen was replaced after being finance minister for only a weekend, with allegations surfacing later that another minister was also offered the job as finance minister – with the promise of R600m in exchange for doing the work of the Gupta family.
Many of these allegations are contained in a report compiled by former Public Protector Thuli Madonsela on the abuse of state funds and the manipulation of politicians for commercial interests.
Wood earlier strenuously denied any knowledge that finance ministers were about to be switched last year.
Eric Wood, Regiments, The New Age and Neotel
The amaBhungane investigation points to firm links between Wood and others in the Gupta sphere of influence.
After Homix was not able to process kickbacks, it appears that Regiments Capital – of which Eric Wood was a director before joining competing Trillian – stepped into the breach.
Says amaBhungane of a Regiments Capital battle that is playing out in court documents: Directors Litha Nyhonyha and Niven Pillay on the one hand, and Eric Wood on the other, fell out after Wood sided with the Guptas when a Gupta offer to buy Regiments fell through.
“Though Wood joined Essa in the competing Trillian Capital Partners this year, the two sides are still trying to have each other removed from Regiments’ board.”
In an affidavit filed last month, Nyhonya describes, and attaches, evidence he says was discovered after Wood left that shows that Wood “knowingly allowed Regiments to be used as a conduit for an entirely fictitious set of transactions” to launder money.
AmaBhungane did a fantastic job with the Gupta exposé. The most irritating part now is that The Hawks won't even move an inch. Sies!
— Agent Provocateur (@De_Imperial) December 9, 2016
Transactions, says amaBhungane, involve Techpro, the Neotel CCTV subcontractor, TNA – the Gupta media company – and TNA invoices “purported to be for Regiments advertising in the New Age”.
Nyhonyha states in his affidavit that Regiments did not advertise in The New Age and that Regiments did not provide the claimed services to Techpro.
Nyhonyha’s version is supported not only by the emails, invoices and backdated contract annexed to his affidavit, but also by a Regiments bank statement which shows the symmetrical flow of R17,1 million from Techpro to Regiments and Regiments to the Gupta company on two consecutive days, say the investigative journalists.
Lawyers are crawling all over the amaBhungane story. The investigative team says Wood has strenuously denied all allegations, Techpro manager Craig Smith has expressed “shock” at the allegations and Transnet has said it has confidence in an “independent” investigation by Neotel which found no wrongdoing by Transnet executives (you can read the full amaBhungane piece here).
Who is Eric Wood?
This is what Trillian says about Eric Wood: Group Chief Executive Officer
Lauded as the “greatest trading star in South Africa”, Dr. Eric Wood is well known for his entrepreneurial spirit and excellent execution capabilities. He holds a Master’s in Management – Entrepreneurship and New Venture Creation (Cum Laude), from the University of Witwatersrand, and a PhD in Management – Corporate Entrepreneurship, from the University of Johannesburg.
Wood has held various leadership positions, including Head of Fixed Income Derivatives at Frankel Kruger Vinderine where he established a Bond Option operation that grew to become the largest Bond Option broking business (by volume) in the South African market. He was approached by Investec to set up a Fixed Income Trading business, which he developed into the largest market maker of Bond Options and Exotic Fixed Income Derivatives in South Africa. Under Eric’s guidance, the business was expanded into Equity Derivatives Trading, Fixed Income and Equity Structuring as well as Gold and Krugerrand trading. Eric was appointed to the Investec Group Strategy and Policy Committee and he was instrumental in the appointment of Investec as Official Market Makers for South African Government Debt. He was a Chairman of the Primary Dealers Association, and an EXCO member of the Bond Exchange of South Africa. Wood was a co-founding member of Regiments Capital, where he served as Executive Director and Group Chief Operating Officer for 11 years, prior to co-founding Trillian Capital Partners.
What does Trillian do?
According to the Trillian website, it offers the following services:
“By combining the skills of renowned business consultants and internationally accredited partners with specialised advisory solutions we deliver the right team, with the right experience, to every client.
- Our highly skilled team embodies experiential local insight
- We are dedicated to solving complex organisational challenges
- We service local, provincial and national government, municipalities, state-owned enterprises and private businesses.
Trillian says it places a strong emphasis on corporate governance.
“At Trillian, corporate governance is about more than simply devising a body of rules that control an organisation. To us, it’s about promoting trust, integrity, accountability and ethical conduct among our team. Our directors strive to provide inspiring leadership, strategic oversight and support to nurture a culture where good governance is embedded in all our actions. In this way we are able to produce and sustain value for all of Trillian’s stakeholders.”