{"id":4840,"date":"2017-06-30T00:00:00","date_gmt":"2017-06-30T00:00:00","guid":{"rendered":"https:\/\/amabhungane.org\/amabhungane\/stories\/leaked-records-show-that-public-funds-were-laundered-from-the-free-state-project-via-dubai-to-pay-for-the-familys-showcase-wedding\/"},"modified":"2024-09-22T20:49:01","modified_gmt":"2024-09-22T20:49:01","slug":"guptaleaks-the-dubai-laundromat-how-millions-milked-from-free-state-government-paid-for-sun-city-wedding","status":"publish","type":"post","link":"https:\/\/further.co.za\/amabwp\/guptaleaks-the-dubai-laundromat-how-millions-milked-from-free-state-government-paid-for-sun-city-wedding\/","title":{"rendered":"#GuptaLeaks: The Dubai Laundromat \u2013 How millions milked from Free State government paid for Sun City wedding"},"content":{"rendered":"\n

By all accounts, the 2013 Sun City nuptials of the Guptas\u2019 niece, Vega, was a dazzling display of the family\u2019s wealth.<\/p>\n\n\n\n

\"\"\/<\/figure>\n\n\n\n

<\/p>\n\n\n\n

Except it was not.<\/p>\n\n\n\n

The #GuptaLeaks reveal that that the Free State provincial government largely picked up the tab for the \u201cevent of the millennium\u201d, as it was described by a guest, KPMG Africa then-chief executive Moses Kgosana.<\/p>\n\n\n\n

\u201cMy wife and I were privileged to attend and enjoyed every moment and every occasion,\u201d Kgosana gushed<\/a> in a thank-you note to Atul Gupta. \u201cI have never been to an event like that and probably will not because it was an event of the millennium.\u201d<\/p>\n\n\n\n

Surely, though, the long list of political and business figures attending the multi-day spectacular were not privy to the veiled source of funds.<\/p>\n\n\n\n

Except KPMG\u2019s Kgosana should have been.<\/p>\n\n\n\n

KPMG were the auditors of the Guptas\u2019 Linkway Trading (Pty) Ltd. This company, we shall see, played a crucial role in the diversion of cash earmarked for the Free State\u2019s Vrede dairy project to reimburse most of the wedding expenses \u2013 R30 million to be exact.<\/p>\n\n\n\n

By allowing Linkway to account for the wedding as a \u201cbusiness expense\u201d, KPMG further ensured that the Guptas paid zero taxes on their Free State government windfall.<\/p>\n\n\n\n

(See also: The Dubai Laundromat \u2013 How KPMG saw no evil at the Sun City wedding<\/a>)<\/p>\n\n\n\n

KPMG said this week it was normal for it to attend \u201cclient related events\u201d.<\/p>\n\n\n\n

\u201cIn this case the wedding attendance was approved by our risk management and the accommodation costs were borne by KPMG\u2026We stand by our work done and audit opinions issued.\u201d<\/p>\n\n\n\n

The Gupta family did not respond to our enquiries<\/a>.<\/p>\n\n\n\n

Gupta Radical Economic Transformation, courtesy Mosebenzi Zwane<\/strong><\/h5>\n\n\n\n

AmaBhungane first revealed in 2013 how the Free State provincial government had gifted an unknown company, Estina, a free 99-year lease to a 4 400-hectare farm outside Vrede. Estina\u2019s sole director was an IT salesman with no farming experience.<\/p>\n\n\n\n

The government also promised Estina R114-million a year for three years to set up a farming operation and dairy, whose supposed purpose was to empower locals and boost provincial agriculture.<\/p>\n\n\n\n

Mosebenzi Zwane, now South Africa’s mineral resources minister and then Free State MEC for agriculture, drove the provincial government<\/a> to adopt the dairy project. Vrede is Zwane\u2019s home town. The project was not put out to public tender.<\/p>\n\n\n\n

Zwane, among the Guptas\u2019 most ardent defenders, recently claimed<\/a> the #GuptaLeaks were an attack on committed government employees.<\/p>\n\n\n\n

Zwane did not respond to our enquiries<\/a> made earlier this week.<\/p>\n\n\n\n

In 2013, amaBhungane established<\/a> that Estina had an address that was also used by Gupta companies and that Kamal Vasram, its sole director, had ties to the Guptas. Despite these signs of Gupta involvement, the family denied any connection save for a R138 000 consulting contract performed by Linkway Trading \u2013 coincidentally or not the same company that features in this story.<\/p>\n\n\n\n

Vasram repeated the Gupta line that the controversial family was not involved, telling amaBhungane at the time: \u201cI wish to categorically state that they are not involved in any manner in this project.\u201d<\/p>\n\n\n\n

The #GuptaLeaks have unravelled these denials. Dozens of e-mails and other records show the family not only had significant control over the scheme, but diverted much of the provincial government\u2019s funding to it for their own purposes.<\/p>\n\n\n\n

The Guptas\u2019 Dubai laundromat milks the Free State<\/strong><\/h5>\n\n\n\n
\"\"\/<\/figure>\n\n\n\n

When Zwane\u2019s successor as agriculture MEC, Mamiki Qabathe, answered questions<\/a> about the project in the provincial legislature in November 2013, she said that by then a total of R114-million of the government\u2019s money \u2013 tranches of R30-million and R84-million \u2013 had been transferred to Estina. <\/p>\n\n\n\n

Financial records in the #GuptaLeaks show that over a six-week period between August and September 2013, Estina had transferred<\/a> US$8 348 700 (R84-million at the time) to the Dubai bank account of a Gupta-controlled United Arab Emirates (UAE) shell company, Gateway Limited.<\/p>\n\n\n\n

That is, the entire R84-million second tranche transferred by the Free State government to Estina landed in a Gupta-controlled US dollar account at Standard Chartered Bank in Dubai.<\/p>\n\n\n\n

In a clear sign that Dubai was little more than a laundry stop, a forensic examination shows that at least three quarters of that money was shortly bounced back to two Gupta companies in South Africa \u2013 including to pay for the wedding. It went like this:<\/p>\n\n\n\n

The wedding celebrations<\/a> were held at Sun City over four days at the end of April and beginning of May 2013.<\/p>\n\n\n\n

Three months later, on July 31, the Guptas\u2019 Linkway Trading, based in South Africa, presented Accurate Investments Ltd, a second Gupta-controlled shell company in the UAE, with a four-page, itemised invoice<\/a> for expenses for the \u201cV & A Function \u2026 at Sun City\u201d (the bride and groom were Vega and Aakash).<\/p>\n\n\n\n

The items for which Linkway invoiced Accurate for ranged from R13 086 for chocolate truffles to R2.3-million for scarves, R247 848 for fireworks and R13.9-million for \u201cevent services\u201d.<\/p>\n\n\n\n

Including VAT, Linkway\u2019s bill totalled a perfectly round R30 000 000. It was further noted that \u201cthis invoice is the equivalent of USD3 333 400\u201d.<\/p>\n\n\n\n

As of the date of Linkway\u2019s invoice, Accurate had a mere US$15 811 in its account at Standard Chartered \u2013 a tiny fraction of the amount invoiced. But thanks to the Free State government and Estina, Accurate\u2019s bank balance would soon improve drastically.<\/p>\n\n\n\n

This is where the laundromat started spinning. If the details are confusing, it is because they were meant to, but it went like this:<\/p>\n\n\n\n