Gupta brothers
Gupta Brothers. Photo: SABC

Four people, including former Transnet Board member Izbal Sharma, appeared in the Bloemfontein Magistrates’ Court today, on charges of procurement fraud involving R24 million, paid by the Free State Department of Agriculture (FSDoA) to Nulane Investment 204, a company owned and controlled by Sharma… that diverted funds to the Gupta family. The National Prosecuting Authority (NPA) said it is also applying to Interpol to assist with arrest warrants for various members of the Gupta family and others involved in the case.

Sharma, whose business partner was Gupta associate Salim Essa, appeared in court today alongside three former senior Free State government officials – former head of Department for Rural Development, Peter Thabethe; former head of FSDoA, Limakatso Moorosi; and former FSDoA Chief Financial Officer, Seipati Dhlamini.

The NPA (National Prosecuting Authority) said in a statement on Thursday that the funds paid to Nulane were diverted to Islandsite Investments 180, a company owned and controlled by the Gupta family.

In the charge sheet handed in at court today, the State alleges that Sharma and his three co-accused colluded to divert funds earmarked for rural development in the Free State. These funds were then placed at the disposal of the Gupta family.

The R24-million was purportedly paid to Nulane to conduct a feasibility study for the Free State’s flagship Mohoma Mobung project, on the basis that Nulane had unique skills to perform the work.

Nulane Investments however had no employees on its books and in fact subcontracted Deloitte Ltd to produce the report, for which Deloitte was paid R1.5 million. The only change made to the Deloitte report was to identify Paras Dairy as a suitable implementing partner for the development of a milk processing plant in Vrede.

The accused face charges of fraud and money laundering. The former government officials are also charged with contravention of the Public Finance Management Act.

The NPA’s Investigating Directorate is opposing bail. The bail application for two of the accused was due to take place today and the bail application for two more will take place on Monday, 07 June 2021.

The fifth suspect in the matter, Sharma’s brother-in-law and a representative of Nulane Investments, Dinesh Patel, will formally appear on 15 June 2021 for health reasons.

They are charged together with three companies – Nulane Investment 204 (owned and controlled by Sharma), Wone Management, Pragat Investment and Islandsite Investments Pty Ltd. The NPA said that the balance of the Accused listed in the charge sheet are not currently in South Africa.

Interpol asked to assist with Gupta arrest warrants

Investigating Directorate head, Adv Hermione Cronje, said the NPA is applying to Interpol to assist with the execution of arrest warrants in respect of:

  • Atul Gupta and his wife, Chetali;
  • Rajesh Gupta and his wife, Arti;
  • Ankit Jain, former Nulane Investment Bank of Baroda account signatory;
  • Ravindra Nath, director of Wone Management;
  • Ramesh Bhat and Jagdish Parekh, the directors of Pragat Investments.

Adv Cronje said:

“The modus operandi used in this case appears to have been replicated in other government departments and projects. It is therefore critical that the evidence gathered in this matter is presented to court and a verdict obtained expeditiously.”

“It is for this reason that prosecutors have decided to proceed separately against the accused currently in the country and those abroad, as the process of arrest and extradition may unduly delay the trial.”

The NPA said that to facilitate a speedy trial in this matter, the accused will be handed a final indictment together with the contents of the case docket on 15 June 2021, when the matter will be postponed to the High Court for the accused to plead to the charges.

DA welcomes Vrede Dairy arrests

The Democratic Alliance (DA) said it welcomed the arrests of the senior officials concerning alleged corruption at the Vrede Dairy Project.

The opposition party has also requested the Special Investigating Unit to investigate, among others, the roles of senior politicians who were the architects of, and approved the funding for, the project. These politicians include former Premier Ace Magashule and former MEC’s Mosebenzi Zwane, Eslabe Rockman and current MEC Mamiki Qabathe.