Business Maverick


After the Bell: There may be another way of getting the Guptas back to SA

After the Bell: There may be another way of getting the Guptas back to SA
Atul Gupta. (Photo: Gallo Images / Sunday Times / Kevin Sutherland) | Vanuatu. (Photo: Flickr / Eugene Kaspersky)

Have you perhaps wondered why Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, is back in the US facing fraud charges in a matter of weeks, while South Africa has found it impossible to get the Gupta brothers back to SA in years?

I spoke recently to an international legal expert on immigration and “golden” passports (who has asked not to be named) for some clarity on the issues involved, and he says there is a way to repatriate the Guptas which does not involve extradition. It overlaps a bit with the Sam Bankman-Fried matter.

As it happens, there is an extradition treaty between the Bahamas and the US, but despite claims that Bankman-Fried was “extradited”, it’s a bit more complicated than that. Fraud charges were brought against Bankman-Fried in the Bahamas, and normally, countries don’t consider extradition until local charges have been heard.

Formal extradition usually takes months, if not years. But in Bankman-Fried’s case, he was on a plane back to the US within a few weeks. One of the reasons was that he waived opposition to being extradited, and the Bahamian authorities waived their right to hear the case before extradition.

Apparently, one of the issues was that he was being held at Bahamas’ Fox Hill prison, which is infested with rats and insects. Couldn’t happen to a nicer guy?

Bankman-Fried claimed he had waived opposition to extradition because he wanted to make his clients whole again (ja, right). More likely, he was advised about another way countries can ensure that wrongdoers return home to face the music.

Presto! The home country can simply cancel the suspect’s passport. It is then impossible for the accused to travel anywhere other than back home because no country will grant entry to someone without a valid travel document.

The Guptas

In the case of the Guptas, there are two additional complications.

According to what has been reported so far, the Guptas managed to avoid extradition from Dubai because Dubai doesn’t want to sully its reputation as a haven for financial crooks. Oops. Sorry, that is in fact incorrect. I mistyped there. Technically, it seems the Gupta brothers claimed they had citizenship of the Pacific island nation of Vanuatu through the island’s golden passport scheme. The island has a citizenship-by-investment scheme that costs about $130,000 and takes only a few months.

Consequently, the Dubai judge found, we think, that South Africa does not have any jurisdictional rights because the Guptas are suddenly citizens of another country. But, says my expert, there is a big problem because Vanuatu doesn’t in fact grant citizenship – it grants something called “honorary citizenship”, which is not quite the same thing.

There are other problems with Vanuatu’s system. Most golden passport countries have very strict screening mechanisms: if you face charges anywhere in the world, you are normally excluded from acquiring a golden passport. The reason is simple: if you grant crooks golden passports allowing them to travel to, say, the EU visa-free, you are implicitly making a mockery of the legal systems of the destination country; the very region whose forbearance you rely on to make your golden passport worth something.

In addition, it’s unpopular for granting countries to hand out passports to crooks because it devalues the passports of your own citizens.

But it turns out that Vanuatu’s screening system was more or less non-existent and, consequently, the EU has given the island notice that it won’t honour its visa-free status if it does not up its game.

That process is still under way and, trust me, the Gupta case has had enough publicity that the island is now under intense pressure. The island also has a problem with the UK because, apparently, Chinese spies were using Vanuatu’s passports to slip into the UK. Hence, the benefits the island got under its membership in the Commonwealth are also in question.

SA citizens

In any event, this “honorary citizenship” does get you a passport, but doesn’t give you citizenship in the proper sense. Hence, the Guptas are still, courtesy of Malusi Gigaba’s apparent open-door policy to foreign crooks, SA citizens.

But, you might wonder, why would the Guptas not just fall back on their old Indian passports? Well, because India doesn’t allow its citizens to be citizens of two countries. When the Guptas got South African citizenship, they automatically relinquished their Indian citizenship.

So, what could SA do? This depends on whether the Guptas got their Vanuatu passports before Interpol’s “Red Notice” was issued. If not, it would be pretty easy to invalidate their Vanuatu passports. But even if they were issued before the notice, SA could ask Vanuatu to formally withdraw their passports.

Presumably, the Guptas are in Dubai on temporary visas. When those expire, without the ability to use Indian or Vanuatu passports, they would have to leave the UAE, but wouldn’t be able to go anywhere except SA where they would be (we hope) arrested on arrival.

Would this work? I don’t know, but apparently it is the system the US uses for places where it doesn’t have a formal extradition treaty. 

I think it’s probably worth a shot. Even if it makes the Guptas’ lives a bit more difficult and prevents them from travelling to, say, Switzerland – the last place they were seen in public – it would be worth it. BM/DM


Comments - Please in order to comment.

  • John Smythe says:

    I doubt that the NPA (or whatever body) has the energy, resources, and drive to get those thugs back in SA to pay their debt back to SA. The good thing is that the Guptas are scurrying around like sewer rats looking for relief from the s%&t they created.

  • Auke Van Der Meulen Van Der Meulen says:

    Don’t get your hopes up! At best the Guptas will be welcomed back and asked if they want to run Escom

  • Jane Crankshaw says:

    There’s another way to get them back – put them on one of the three daily flights between Dubai and South Africa – now known as the “Laundry Run!” Easy Peasy!

  • R S says:

    “According to what has been reported so far, the Guptas managed to avoid extradition from Dubai because Dubai doesn’t want to sully its reputation as a haven for financial crooks. Oops. Sorry, that is in fact incorrect. I mistyped there.”

    When I watched the Zim gold syndicate doccie and Dubai kept on coming up, this was the first thought I had.

  • Johan Buys says:

    Good idea and even if that does not get them back here, the SA passports of any fugitive should be cancelled automatically.

  • Peter Oosthuizen says:

    Does anyone think that we want them to go on trial here?
    What do they know that we don’t ?
    Zuma wasn’t the only crook involved with them and if they spilled the beans in exchange for a good deal, quite a few of our honourable ANC stalwarts would also be exposed.

    • Alastair Stalker says:

      Precisely. There was never any chance that the Guptas would be extradited. The NPA was obliged to go through the motions but the possibility that the Guptas might spill the beans was way too high to risk. If we were serious we could always have asked a favour of the Sheikh when he was here for his biltong hunt

  • Peter Dexter says:

    An interesting approach, but it is based on the assumption that the South African government and NPA (read ANC) want them back here spilling the beans. I suspect we will see half hearted attempts designed only to placate the public, but with no clear intention of success.

  • Luan Nel says:

    Hand our authorities a solution to extraditing the Guptas, on a plate, then watch them, at first, ignore the solution, then find some way of messing it up, afterwards acting befuddled, watch them evade justice, one way or another. This is my prediction in this case. Who needs astrology when you have our government performing a script, unconvincingly?

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