Oakbay Investments has repudiated claims that funds belonging to the Optimum Mine Rehabilitation Trust have been used improperly.
The company was responding to the bombshell dropped by Minister of Finance Pravin Gordhan over the weekend, which revealed that Oakbay’s previous banks had made several reports to the Financial Intelligence Centre (FIC), citing a number of “suspicious” transactions involving Oakbay, the Guptas, and related companies.
Banks are mandated to report transactions they consider ‘suspicious’ to the FIC. This is to assist in the prevention of illegal activities relating to crime, terrorism and money laundering. The suspicious activities relating to the Guptas amounts to R6.8 billion.
In Gordhan’s affidavit, the minister states that, following the receipt of a certificate from the FIC, one of the transactions flagged “is the reporting of an amount of R1.3 billion as a suspicious transaction, in terms of the FICA, relating to Optimum Mine Rehabilitation Trust”.
While the minister acknowledged not being sure whether the funds were in fact transferred from Standard Bank to the Bank of Baroda when the former gave Oakbay notice that it intended to terminate its relationship with them, he did confirm that the department of mineral resources had authorised the transfer.
Included in Gordhan’s affidavit was a letter from the lawyers representing Optimum’s business rescue practitioners, Piers Marsden and Peter van den Steen, dated June 27 2016 drawing the attention of the South African Reserve Bank (Sarb) to the transaction: “…recent press reports have indicated that Sarb is investigating the Bank of Baroda; the business rescue practitioners have requested us to write to you to enquire whether Sarb has any reservations or concerns with the trustees transferring the Trust’s funds to the Bank of Baroda.”
Initial fears were that the money may have been transferred outside of the country, or removed from the trust to pay back loans for the acquisition of the Optimum coal mine. Responding to questions from Mineweb, Oakbay has now denied this.
The statement from the company (dated October 17 2016) reads: “The Rehabilitation Fund balance was moved from Optimum Mine Rehabilitation Trust’s account with Standard Bank to Bank of Baroda in June 2016. This transfer was due to Standard Bank’s closure of all company accounts. This is the only movement of money from this account. This movement was with the full permission of the joint Business Rescue Practitioners.
“Any suggestions that the Rehabilitation Fund has been drawn down upon are absolutely untrue and defamatory.”
Attached to the statement is a letter from the Bank of Baroda dated October 5 2016, confirming that an amount of R1 470 338 316 sits across four accounts held in the name of the trust. Read the letter from the Bank of Baroda here.
Thus far, everything appears to be in order. The only curious point is why the funds were moved out of long-term investment vehicles in the first place.
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