A Transnet pension fund lawsuit has exposed how hundreds of millions of rands in pensioners’ money allegedly ended up in the accounts of Gupta companies.

According to a Business Day report by legal writer Karyn Maughan, the Transnet Second Defined Benefit Fund has stated in court papers that just more than R210m of the money used by the Gupta family to pay a deposit on the Optimum coal mine can be traced back to money ‘misappropriated’ from its members.

The fund, which has 51 000 members, describes in the papers how Regiments Fund Managers and Regiments Securities had unlawfully caused the transfer of more than R228m of pensioners’ money into its own accounts, ostensibly because it was owed this money for advisory services to the rail and ports company.

Those services were allegedly provided primarily in relation to its purchase of 1 064 locomotives, which ballooned from R38.6bn to R54.6bn in what the state said was an ‘unjustified escalation’.

Part of that money, according to the fund, ended up in the Bank of Baroda account used by the Guptas to pay the Optimum coal mine deposit.

In court papers, the fund also accuses Regiments Capital – a company described by the NPA as a pivotal tool in the Guptas’ extraction of money from state-owned entities – of fraudulently funnelling R122m in allegedly unlawful fees it received from Transnet, through a front company, to Gupta-owned Sahara Computers.

This money, according to the fund, was paid ‘pursuant to a fraudulent invoice in respect of IT services’.

The legal action launched by the fund against Eric Wood and his Regiments and Trillian companies comes after his now estranged fellow Regiments directors in 2019 agreed to pay the fund a settlement of R630m in total, says the Business Day report.

Wood was a director at Regiments and the founder of Trillian.

Regiments directors Litha Nyhonyha and Niven Pillay insist that the settlement was in no way an admission of liability.

The fund’s case against Wood details a massive looting conspiracy that implicates a number of senior Eskom and Transnet officials, including Matshela Koko, in diverting ‘public funds from state-owned enterprises, organs of state and pension funds for employees of state-owned enterprises and organs of state ... to entities associated with (Gupta associate Salim) Essa and/or the Gupta family’.

Koko reportedly told Business Day that ‘the conspiracy, as far as it is applicable to me, is far-fetched, laughable and scandalous’.

Wood has yet to file a response to the fund’s case against him, in which it seeks an order that will force him to pay it back more than R263m.

Full Business Day report