Release of funds to Gupta-linked group blocked
Days before R1.26bn in frozen funds was due to be released to Gupta-linked Chinese rail group CRRC, the Gauteng High Court (Pretoria) yesterday handed down an order that the monies remain frozen until the company provides a bank guarantee for the same amount to SARS, notes an amaBhungane report on the Daily Maverick site.
An additional R1.5bn will also remain frozen pending a bank guarantee, meaning R2.76bn will remain preserved while SARS finalises a tax claim against CRRC.
The taxman had rushed to court to prevent the release of the funds that the SA Reserve Bank froze three years ago ‘based on irregular outflows and inflows from an exchange control perspective’.
Underlying the Reserve Bank’s action at the time was evidence first revealed by amaBhungane and our #GuptaLeaks partners that CRRC companies were paying a fifth of their revenue from Transnet locomotive contracts to Gupta offshore fronts as kickbacks.
The Reserve Bank later blocked additional amounts, which currently stand at a total of R4.2bn, but the initial tranche of R1.26bn was due to be released on Saturday, 12 December, under a rule that funds must be unfrozen after 36 months.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.
