NPA Investigative Directorate files for seizure of Gupta assets

Five years after erstwhile public protector Adv Thuli Madonsela released her State of Capture Report detailing how Tegeta Resources, a company owned and controlled by members of the Gupta family, acquired Optimum Coal Holdings from Glencore for R2.1b, the Investigating Directorate (ID) on December 8 filed two related court applications to recover the stolen funds and served the respondents the application on December 9.

The High Court of South Africa, Gauteng Division, Johannesburg, will hear the preservation application on March 8, 2022.

In the first application, ID seeks to preserve all of Tegeta’s shares in Optimum Coal Mine (OCM), all of Tegeta’s shares in Optimum Coal Terminal and the business of OCM. It is ID’s case that these assets were gained with the proceeds of crimes perpetrated against South African state-owned enterprises, including Transnet and Eskom.

A month before Tegeta furnished the purchase price, the company did not have the R2.1-b to purchase the mine.

However, shortly thereafter, funds from Gupta-controlled entities Oakbay Investments, Albatime and Centaur Mining amongst others, were transferred into Tegeta’s account as loans.

ID seeks to persuade the court that officials employed by Eskom fraudulently and post-haste caused Eskom to make a prepayment of R659 558 079.38 to Tegeta on April 13, 2016.

This pre-payment was fraudulently presented as necessary to ensure the supply of coal to Arnot power station when its true purpose was to avail Tegeta of the purchase price for Optimum.

A further R104 500 000 paid over to Tegeta as loans from Albatime and Trillian can be traced to funds stolen from the Transnet Second Defined Benefit Fund by Regiments Fund Managers (Pty) Ltd on December 4, 2015, and an amount of R93 400 000 tainted by fraud and corruption paid on December 4, 2015, by Transnet to Trillian Asset Management ostensibly as fees arising from the R12-b ‘Club Loan’.

These funds were laundered through Albatime and Trillian and made available to Tegeta as loans.

In October 2021, Kuben Moodley of Albatime was arrested before embarking on a trip to Dubai on charges related to these offences.

He is expected to appear in the Palm Ridge Specialised Crimes Court on February 28, 2022.

The second application is brought against a Bermuda company called Templar Ltd, an international investment firm and the largest independent creditor in Optimum Coal Mine.

The Templar claim is valued at approximately R1.3b. It is ID’s case that the funds underlying the Templar claims are funds that were advanced by the Gupta family Dubai company, Griffin Line Trading LLC, a company nominally controlled by Ajay Gupta’s son, Kamal Singhala.

Daniel McGowan, the owner of Templar, has himself stated under oath that the funds advanced by Griffin Line derived from ‘money stolen from the South African government and laundered via Mr Singhala on behalf of his father and wider family members’.

With the two applications, ID seeks to have forfeited to the State, the proceeds of one of the primary criminal schemes linked to State Capture.

The Department of Public Prosecution is seeking an expedited hearing of the matter before March 28, 2022, the deadline for implementation of the OCM Business Rescue Plan.

The preservation application is necessary to prevent the business rescue process from being abused to legitimise the proceeds of crime. The goal is to ensure a fair, open and competitive sale of the mine, in the interest of the mineworkers, creditors and the broader public.

Notice was given to all respondents to file answering affidavits on or before January 10, 2022, and file answering affidavits by January 28, 2022, to show why the assets gained by the Guptas and their associates should not be preserved and later forfeited to the State.