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Bank of Baroda cries foul as cash frozen in Gupta case

State’s case embarrassing, says lawyer for Gupta-linked firms.

India’s Bank of Baroda objected to the freezing of some of its funds in South Africa after it was alleged to have helped transfer money meant for the development of a government-backed dairy farm to the politically connected Gupta family and their associates.

The R30 million ($2.5 million) preservation order is wrong because the money due to clients had already been withdrawn and the attachment of an equal amount of the lender’s own funds is “unsustainable,” Luke Spiller, a legal representative for the Bank of Baroda, said in the Free State province’s High Court in Bloemfontein on Thursday.

The court documents showed that other banks transferred cash to the same dairy farm but their money wasn’t frozen, making the order against Bank of Baroda unfair, the lawyer said.

The case is related to a state-owned farm in the Free State leased to Gupta-linked company Estina (Pty) Ltd. in 2012. The regional government agreed to help develop the land, but the High Court on Jan. 19 gave the National Prosecuting Authority permission to freeze the project’s assets after more than 220 million rand destined for the farm was said to have been transferred to Atul Gupta, one of three brothers, and a number of companies and associates.

Atul Gupta and businesses linked to his family have applied to the same court to reconsider the attachment of the assets. The Gupta family have close ties to former President Jacob Zuma and have been accused of using the association to win state business and influence government appointments. Zuma and the Guptas have denied wrongdoing. The crackdown on the dairy farm project came just weeks after South African President Cyril Ramaphosa replaced Zuma as head of the ruling African National Congress.

The prosecutor’s papers are “a national embarrassment,” Michael Hellens, a lawyer acting for a number of Gupta-linked companies including Oakbay Investments, said in the same court. The chief prosecutor failed to provide evidence that money destined for Estina went into accounts with the Bank of Baroda and then to the Guptas and their associates, he said.

Closed accounts

The Bank of Baroda last year tried to close all accounts linked to the Gupta family after all other banks in South Africa had spurned their business. After a legal challenge the Indian lender wasn’t able to terminate the accounts and said last month it was going to have to leave South Africa. Lender Nedbank told Bank of Baroda at the end of January it would cut its ties after three months, Johannesburg-based Business Day newspaper reported on Wednesday, citing the most recent court filing of the South African head of Bank of Baroda, Manoj Kumar Jha.

Atul Gupta, whose affidavit was signed in Dubai last month, didn’t appear in Bloemfontein on Thursday and has previously denied in court documents that cash meant for the development of the dairy farm was transferred to his private bank accounts. Bank of Baroda transferred the 10 million rand that Estina paid it into a fixed-deposit account in the farm’s name a few days later, according to Gupta’s lawyer, who also spoke in Bloemfontein.

Eight people accused in the dairy-farm case appeared in court last month and were granted bail. They were arrested on charges of fraud and theft related to the project. Atul Gupta and his brothers weren’t among those arrested. Ajay, one of the siblings, was seen leaving the country, bound for Dubai, on Februaty 6, and was spotted in India last month, according to the Times of India. South African police have declared him a fugitive from justice.

In a separate court action Thursday in the capital, Pretoria, 20 Gupta companies are trying to force Bank of Baroda to stay in South Africa. Judgement has been reserved in that case.

© 2018 Bloomberg 

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….bugger, I missed the opportunity! Is it now too late for me to get a LARGE LOAN from Bank of Baroda? 🙁

Why only R 30 million….they should freeze all the banks money?

Jaaaa-if you sup with the devil you need a very long spoon.

Bank Of Baroda has a point . Why other banks’ funds not frozen post de facto.

Secondly, where was the much feared SARB Supervision Department. internal and external auditors and Financial Intelligence Center as I believe some transactions were reported to them? All fast asleep.

SARB was captured years ago. That is why they protested so loudly when the Public Protector dared to ask Absa to pay back the tax payers money which they took as part of the SARB “lifeboat” to Absa. There were so many politicians and public officers involved in what became known as “Tollgate” it was a joke. Many of these people are still conducting the same form of “business” today. The Gupta’s are small fry compared to them.

IF, you want to know how stuff is stuffed up in this country of mine that I so much love but I am completely exasperated by, you only have to look at how a criminal enterprise like this bank, can aid and abett openly criminal activities with a known and well established (and well connected gupta-criminal enterprise), and when they are supposed to be ‘investigated’ they can merely say: ‘we are leaving the country’. Where are all the law enforcement agencies, where is the reserve bank, where is the FSB, and otheres, who should have actively taken interest in the bank, when all the other banks refused to be the head quarters for money laundering and basically money mules for the Guptas. They should not be leaving, they should be investigated, there must be 101 crimes committed by this bank by flouting our legal and banking system. IF, these entities move in on time, the furnaces might still be hot. But I am not holding my breath, because if the NPA does what it did withe respect to moving in on the Gupta compound, you can bet your bottom dollar on the fact that someone must have tipped them and then waited for them to leave the country before ‘acting’. So, don’t hold your breath. Is it any wonder that I am besides myself, and am sure am not the only one.

‘Where are all the law enforcement agencies, where is the reserve bank, where is the FSB, and otheres’ – they are transformed.

Excellent! I want to hear them screaming and then I want them locked up.

how about a big fcuk you Luke, for you and your thieving ilk.

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