Pieter-Louis Myburgh and Angelique Serrao
The Gupta family and some of their associates have established an extensive network of front companies in and around Dubai that has been used to conceal and allegedly launder hundreds of millions of rands in dubious payments linked to government contracts in South Africa.
A News24 investigation has confirmed that at least six Gupta-linked companies registered in the United Arab Emirates (UAE) are shell companies that either list fraudulent addresses or whose business premises are rarely, if ever, manned by actual employees.
At least R760m in payments linked to contracts from South African state-owned companies and government departments were channelled through some of these companies, documents contained in the #GuptaLeaks have shown.
News24 travelled to Dubai to try and establish whether any of these companies at the centre of alleged money laundering linked to state capture actually exist.
Our investigation has confirmed what some South Africans with knowledge of the Guptas’ business dealings have long feared, namely that the Guptas and some of their associates are deliberately flushing alleged ill-gotten gains through their shell companies in the UAE because of the country’s strict financial secrecy laws and favourable tax provisions.
The Transnet millions
One of the companies News24 visited is JJ Trading, which, according to earlier #GuptaLeaks reports, received at least R760m in alleged kickbacks from large Chinese companies contracted to Transnet, South Africa’s state-owned rail and logistics operator.
Unlike most of the other Gupta-linked shells, JJ Trading actually has a website. It describes the company as a trader in “agro products” and scrap metal.
The website also lists an address for JJ Trading in the Hamriyah Free Zone in Sharjah, about 50km north of Dubai. Hamriyah is one of more than thirty free zones, or free-trade zones (FTZs), located in the UAE. These zones allow businesspeople from abroad to establish companies with 100% foreign ownership and also offer attractive tax perks.
However, when News24 visited the Hamriyah Free Zone’s main entrance, the guards on duty told us that no company by the name of JJ Trading has premises there.
The queries we sent to the email address and the cellphone number provided on the company’s website went unanswered.
Milking the Free State
We also tried to locate the offices of Global Corporation, Accurate Investments and Fidelity Enterprises.
These three Gupta shells were used to launder tens of millions of rands in proceeds from the Free State provincial government’s failed Vrede dairy project in order to ultimately help pay for the Guptas’ lavish wedding party at Sun City in 2013, according to an investigation by amaBhungane.
Payments from Accurate Investments to Brookfield Consultants, a US-based company linked to relatives of the Guptas, have also attracted the attention of the Federal Bureau of Investigation (FBI), the Financial Times recently reported.
According to documents in the #GuptaLeaks, Global Corporation and Accurate Investments supposedly share the same address in a building next to a lagoon in the Emirate of Sharjah, Dubai’s neighbouring emirate.
But the address led us to a residential tower, and the guard at the reception informed us that there are no companies operating out of the building.
Fidelity Enterprises, which processed more than R30m of taxpayers’ money milked from the Free State diary project, also turned out to be nothing but a front. Business owners in Al Quoz, an industrial area south of Dubai’s city centre where the company is supposed to be located, told us that Fidelity’s address is incorrect and that they’ve never heard of such a company in the area.
When we did manage to find an actual office for one of the Gupta shells, Griffin Line General Trading, the door was locked and there was nobody inside.
The company is situated in an office tower in Dubai’s main business district and, if its website is to be believed, trades in rice, spices and other foodstuffs.
But judging by documents in the #GuptaLeaks, Griffin Line has mainly been used to settle some of the Guptas’ accounts with travel agents and hotels.
An office worker from another company on the same floor told us that they sometimes see a woman at Griffin Line. We sent the company queries through a portal on its website, but it went unanswered. The Guptas also did not respond to queries emailed to them.
News24 ultimately spent a week chasing from one Gupta-linked company to the next without encountering a single employee.
For a network of companies that has received nearly a billion rand in revenues linked to public expenditure in South Africa, the Guptas’ UAE-based businesses are eerily deserted.
*News24’s trip to the UAE was made possible by a grant from the Taco Kuiper Fund for Investigative Journalism, administered by Wits Journalism.