The Gauteng Division of the High Court in Pretoria has granted the National Prosecuting Authority’s (NPA’s) application for two forfeiture orders to settle ongoing litigation over Optimum Coal Mine and Optimum Coal Terminal.

The order marks the end of the NPA’s case to seize Optimum assets on the grounds that the Gupta-owned Tegeta Resources bought it with the proceeds of crime in 2016.

They did this with the aid of cash raised via Eskom, Transnet and one of its pension funds and with the help of Eskom executives, Regiments Capital and a company in the Trillian stable.

Handed down on Thursday afternoon, the forfeiture orders flow from an agreement with former Gupta business associate, Daniel McGowan’s Templar Capital.

Daily Maverick first revealed details of the R500-million cash settlement last week.

It requires Templar to settle an approved list of Optimum creditors for just over R460-million, make payment towards curator fees and pay the NPA’s legal costs of roughly R20-million.

An amount of R19-million has been allocated to the Criminal Asset Recovery Fund.

In Thursday’s ruling, the court said it was satisfied that the draft orders put forward following the agreement between the NPA and Templar are appropriate as contemplated in terms of the Prevention of Organised Crime Act (Poca).

Optimum Coal is part of a basket of Gupta assets placed into voluntary business rescue after South African banks terminated their bank accounts a few years ago.

McGowan’s Templar acquired a R1.3-billion creditor claim in Optimum via a cession from Centaur Ventures Limited in Bermuda.

This claim came to serve as the basis for a debt swap deal that allows Templar’s indirect subsidiary, Liberty Coal, to take over Optimum.

Read more in Daily Maverick: NPA strikes forfeiture deal to end Gupta-linked Optimum Coal wars

In late 2022 the NPA’s Investigating Directorate, then under the stewardship of Hermione Cronje, filed the two preservation applications on the grounds that the assets were acquired by the proceeds of crime and/or were the instrumentality of crime.

One of the applications sought to attach the Gupta family’s shares in Tegeta as the owner of Optimum Coal Mine and Optimum Coal Terminal, and a second involved the preservation of Templar’s creditor claim.

Both orders were granted in May 2022 after which the NPA filed the forfeiture applications. By agreement with Templar, these are now settled.

In Thursday’s ruling, the court said it was satisfied that the draft order put forward following an agreement between the NPA and Templar is appropriate as contemplated in terms of Poca.

Significantly, the court accepted that cash used towards the purchase of Optimum was, on a balance of probability, the proceeds of crime.

The settlement only covers a portion of the overall R2-billion Optimum purchase price and the forfeiture amount is considered proportionate.

The settlement deal will likely put the NPA under fresh pressure to action prosecutions in respect of Optimum and the role played by some of State Capture’s usual suspects.

The undisputed proceeds of crime, according to the court order, are made up of a R660-million prepayment for coal that Eskom paid the Gupta-owned Tegeta Resources and Exploration plus cash extracted from Transnet and the Transnet Second Defined Benefit Fund (TSDBF).

In the case of Transnet and the TSDBF, the money was ultimately placed in fixed deposits that served as security for loans for the Gupta purchase.

These payments relate specifically to Regiments Capital, its offshoot, Trillian Capital Partners and Albatime, a company owned by Kuben Moodley, regarded as a Gupta fixer at the time.

Guptas tried, failed to block it

The order follows what appears to have been an unsuccessful last-ditch bid by the Guptas to try to intervene in the matter on Monday, January 29 2023.

Griffin Line, a Dubai-registered company, central to the NPA’s reasoning for cutting the deal with Templar Capital, filed an eleventh-hour application to delay the hearing for the two agreed-upon forfeiture orders. 

The company had hoped for a postponement of the hearing so it could file an intervention application setting out why the forfeiture deals with Templar cannot go ahead.

In a hurriedly filed affidavit, it said the creditor claim that underpins the sale of the business to Templar’s Liberty Coal, is the subject of ongoing litigation in Bermuda.

Therefore, Griffin Line argued, a forfeiture order granted in South Africa ahead of the conclusion of that legal battle would “offend” an order of the Bermuda Supreme Court which has granted an injunction that prohibits Templar from dissipating the claim.

While the high court has not released an order relating to Griffin Line’s application, it has handed down the forfeiture order suggesting the Gupta-linked company was unsuccessful and that a written ruling may follow later.

This attempt at intervening in the forfeiture proceedings may have made for quite an extraordinary development as it would have drawn the Griffin Line into litigation with the NPA in South Africa.

The NPA conceded that it was opting for the forfeiture settlement with Templar, primarily because it had not been able to secure vital evidence from the UAE.

This evidence is needed to help build its case that further cash that was mobilised via Griffin Line and channelled through Centaur Ventures Limited before it was used towards the Gupta purchase of Optimum, was also the proceeds of crime. DM