Bank of Baroda, the Guptas, Jacob Zuma and a web of suspicious transactions

The Bank of Baroda (BoB) played a crucial role in allowing South Africa’s politically influential Gupta family to move hundreds of millions of dollars linked to alleged dirty deals into offshore accounts, an investigation by the Organized Crime and Corruption Reporting Project (OCCRP) and The Hindu has found.

The bank’s Indian head office denies any wrongdoing in the affair. But interviews and documents obtained by reporters show that the bank’s South African branch issued unapproved loan guarantees, quashed internal compliance efforts, and prevented regulators from learning about suspicious transactions in a way that benefited the Guptas’ network.

This report reveals new details of a scandal that has rocked South Africa in recent months.

The Gupta brothers — Atul, Ajay, and Rajesh, who immigrated to the country from India in the 1990s — are accused of using their money and influence to pursue a project of “state capture”, in collaboration with former President Jacob Zuma, to enrich themselves at the expense of taxpayers.

The scandal led to Zuma’s resignation under pressure from his ruling African National Congress (ANC) on February 14. Earlier on the same day, the police raided the Guptas’ Johannesburg mansion and have issued an arrest warrant for Ajay. The three brothers, as well as the former president’s son Duduzane, are on the run and believed to be in Dubai.

Duduzane Zuma is accused of being a key player and beneficiary in the Guptas’ financial dealings. His father appointed many of the key officials that made the family’s schemes possible.

At the core of these was the South African branch of the BoB. The documents obtained by reporters show the bank was host to hundreds of millions of dollars worth of suspicious transactions.

One of the larger deals that appears in the transactions is the Guptas’ irregular acquisition and allegedly illicit sale to themselves of a major South African coal mine.

The revelations in the documents follow the bank’s announcement in mid-February that it was shuttering its South African operations.

The head of the Bank of Baroda’s South African branch, Sanjiv Gupta, may face disciplinary action over the bank’s business in the country. (He is not related to the Gupta brothers.)

A senior Indian government official, who asked to remain anonymous, said the bank had asked the Central Vigilance Commission, the country’s top anti-corruption body, to initiate penalty proceedings against Sanjiv Gupta, which could result in his dismissal.