DAYS OF ZONDO

Gupta money was channelled along terrorist network – and paid for Zuma’s legal fees

By Rebecca Davis 22 June 2021

Illustrative image | Sources: Former president Jacob Zuma. (Photo: Gallo Images / Darren Stewart) | Advocate Kemp J Kemp. (Photo: Gallo Images / Foto24 / Emile Hendricks) | Atul Gupta. (Photo: Gallo Images / The Times / Puxley Makgatho)

In a bombshell day of testimony at the Zondo Commission, it was revealed that money from the Gupta enterprise paid Jacob Zuma’s Arms Deal legal fees – even while the state was ostensibly footing the legal bill. It has also emerged that the Guptas made use of an international money laundering framework used to finance terrorism and drug cartels.

Rebecca Davis

The Guptas used a number of front companies to channel money to the late advocate Kemp J Kemp to cover former president Jacob Zuma’s legal fees.

Research to this effect was presented to the Zondo Commission on Tuesday by Shadow World Investigations’ Paul Holden.

A 2013 invoice presented to the commission shows Kemp J Kemp billing Zuma’s lawyers Hulley & Associates for legal services rendered in relation to Zuma’s unsuccessful attempt to oppose the DA’s application to overturn the decision of the National Directorate of Public Prosecutions not to prosecute Zuma in relation to the Arms Deal.

An amount of R60,676.37 was paid to settle an outstanding bill from Kemp, with the funds channelled to Kemp through Gupta front companies Homix and Bapu Trading.  

This was at a time when the state was covering Zuma’s legal fees as a result of an agreement reached during the presidency of Thabo Mbeki – much to the displeasure of the DA, which succeeded in having the agreement overturned in December 2018.

Exactly why Kemp was apparently being paid twice for the same work is unclear – with Kemp having succumbed to Covid-19 in January 2021.

In what evidence leader Matthew Chaskalson termed “another disturbing discovery”, Holden also told the State Capture inquiry that at least two of the Guptas’ front companies were using a money laundering operation which has been used to launder money for international drug cartels and for terrorist groups, including Al Qaeda.

Payments were made by the firms Donsantel 133 CC and Truhaven into the Khanani money laundering organisation: the brainchild of Altaf Khanani, known as the world’s most-wanted money launderer.

A US investigation had established that the Khanani network was used for “heinous criminal activities”, Holden said.

This revelation emerged as Holden sketched what he called the “spider web”, which he defined as “an extraordinarily busy and complex money laundering network” used by the Gupta enterprise.

He explained that the Guptas used a first-level “laundry vehicle” to receive State Capture funds: local front companies.

“Contractors to the state would make multiple payments to these,” Holden said, in what was just the initial part of a much broader scheme.

This “local laundromat” would connect into an “international laundromat”: a system of connected entities that would launder money by passing it through multiple accounts until it exits.

Holden stressed that it is generally impossible to trace the end point of these funds due to the sophisticated nature of the network. It appeared, he said, that the Guptas made use of pre-existing criminal networks predominantly in Hong Kong, China and Dubai.

The researcher told the commission that Gupta companies transferred just under R5-billion offshore in 3,659 transactions between 2010 and 2021 via “a vast international laundry operation I call the Hong Kong/China laundry”.

During Holden’s previous appearance before the Zondo Commission, in May, he put the total amount lost to the Guptas’ State Capture at almost R50-billion.

The figure has now risen to just over R57-billion, due largely to new evidence presented to the commission regarding IT company T-Systems’ contracts with the state. Between January 2010 and December 2014, T-Systems charged Transnet an average amount of R263,408,760.30.

Over the next four years, with the contract renewed, Transnet paid T-Systems more than three times this amount – despite the fact that the services being rendered by T-Systems had diminished. Between January 2015 and December 2018, equipment sales and rentals previously covered by T-Systems were now handled by a company called Zestilor – owned by Zeenat Osmany, the wife of Gupta lieutenant Salim Essa.

In total, Transnet paid R241,379,328.76 to Zestilor. Eskom also paid R2,490,484.50 to Zestilor after Eskom similarly outsourced services.

The day’s hearing at the Zondo Commission began with the reading of a number of affidavits from parties implicated in Holden’s previous testimony at the State Capture inquiry. Holden noted that although there have been “objections to very specific elements” of his findings, there has been no substantive disagreement with the “general thrust”.

Said Holden: “I don’t believe that any of the information presented would make me think [that] these weren’t contracts tainted by State Capture.” DM

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All Comments 33

  • Read The Mechanism by Vladimir Netto,brought Brazil to its knees.Repeat in South Africa,criminals are so sophisticated, cartels ,terrorist organizations all get in on the act.The bad guys are winning because the good guys bicker between each other,don’t forget the roles of international banks,read The Infiltrator by Robert Mazur and you start getting the picture,The Mastermind by Evan Ratliff to a lesser extent. All you need is different cartels and syndicates to start working together with certain goverments using all there different routes and channels,mind-boggling.

  • What’s missing in all this investigation is “What was Zuma’s cut?”
    “How much did he get for selling us out on this scale?”

  • Zuma and his cronies didn’t do enter into all these clandestine deals for nothing. Their funds will be sitting safely in concealed offshore trusts and companies and these need to be found, the funds returned and the culprits prosecuted. All of them.

  • Duduzane and Essa are shacked up in Dubai, right? If would be interesting if they even know the full story, but that’s where the route to getting this back starts

  • R 57 BILLION! How many houses could you build? How many families could you feed? How many kids could you send to school and university? The Guptas have added to the mass poverty in this country and the government let them go! Now we’re spending tens of millions on talking about it in commissions and hearings?
    When will see some justice? When is Zuma going to jail? We are far too soft on criminals who have lots of money.

    • Indeed, but we shouldn’t lose sight of the many billions that are stolen by the many / majority of corrupt municipalities. Read the relevant article in this edition of DM.
      The Zondo numbers keep our attention because they are so large but it is going on all the time and all around us. Viva ANC viva!!!

  • Gupta, Essa, Surve, Sharma, Shaik – the Zuma brotherhood and enemies of the State! Investigations into all their lifestyles will disclose the money trail no amount of laundering could hide. R57billion is the tip of the iceberg…..all of it stolen from the weary South African taxpayer. As a taxpayer in this country, and on behalf of the disenfranchised people of SouthAfrica, I demand justice and an end to the theft and corruption that now seems to be entrenched within the ANC facilitated by a select few opportunists. This has to stop. Until the cancer is cutout…we have no chance of survival.

    • It would be interesting to see how much tax was paid on these so called fees. No wonder SCs are considered too expensive to employ other than if the taxpayer bears the bills.

    • Yip. One of the deserving victims. I was only doing my job,sending Kweszi upwards and Jacob to riches he cant even underdtand. Thanx for nothing.

  • For Sharma to have remained in the country he must have believed that he was fully protected or immune from prosecution. It would be interesting to know if Duduzane Zuma is still in SA.

  • This boils down to economic terrorism and as such these criminals should not end up in jail, they should be shot as enemies of the state, including Zuma.

    • There is no accountability or repercussion. Zuma has given 2 fingers to the Z.C. & nothing has happened. We all know corruption has been happening on a huge scale for years & now the evidence is clear but the culprits are all sitting comfortably on their stash. Complete lack of departmental oversight across the board. Minister’s heads on spikes outside Parliament would send a message!

  • Hopefully these evidence will assist the NPA to charge the Gupta’s as well as Duduzane Zuma and Jacob Zuma for these serious crimes and all their assets must be attached. We also need to know how these monies were laundered without the the authorities noticing and this includes the Banks with all systems to pick up these large amounts flowing out of the country. If the legal fees was paid through Hulley, what was their role and are they complicit ?

  • If indeed the ill gotten Gupta monies were channeled along terrorist pathways , then that makes the whole saga extraordinarily international, and then surely a matter for global terrorist fighting entities?And it doesn’t do much for the South African governments already somewhat tarnished external image( think Bashir) that we could be seen, at least in the early stages of State Capture, to be aiding and abetting malfeasance players!

    • It certainly doesn’t do SA’s image any good at all and perhaps the charge sheet for Zuma et al should be changed to High Treason

    • “The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued an Executive Order (E.O.) 13818 blacklisting the Gupta brothers and Salim Essa from doing business in the US, and with US businesses, for their involvement in grand corruption in South Africa pursuant.” DM 14 October 2019 What the US blacklist of Gupta brothers means by Omphemetse S Sibanda

  • When is all this going to stop? When are we going to see real action with people being charged criminally? I have worked for more than 40 years and am now retired. I drives me to despair that after all the money I have paid in taxes to make the State work and to ensure equity has gone into the pockets of foreigners and members of the ruling party. Even the despicable Julius Malema and his red-bereted followers and members have eaten from the trough of ill-gotten money. Sick!!! Despicable!!!

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