UAE in talks with South Africa on extraditing Gupta brothers

Jacob Zuma, former South African president, arrives following a recess break in the state capture inquiry in Johannesburg on July 15, 2019. MUST CREDIT: Bloomberg photo by Waldo Swiegers.

The United Arab Emirates is considering handing over two brothers who are wanted in South Africa for allegedly masterminding the looting of billions of dollars from state entities.

Emirati and South African authorities are discussing the extradition of Rajesh and Atul Gupta following their arrest in the UAE, the Dubai police and South Africa’s state prosecutor said on Tuesday. The two men, who are wanted in South Africa on charges of money laundering and fraud, were detained after Interpol in February placed them on its most-wanted list.

The arrests are the most significant step yet in South Africa’s efforts to hold to account businessmen and officials accused of corruption during former President Jacob Zuma’s nine-year rule that the government estimates cost the state 500 billion rand ($32 billion). The rand was one of only three emerging-market currencies to gain against the dollar on Tuesday, erasing an early decline to trade 0.3% stronger at 15.3593 per dollar by 12:37 p.m. in Johannesburg.

A judicial inquiry into state graft spanning more than three years detailed close links between the Guptas and former President Jacob Zuma, with numerous witnesses alleging they worked hand-in-hand to siphon money out of state transport, power and arms companies and jointly decided who was appointed to the cabinet. The Gupta brothers and Zuma have always denied the allegations.

The arrests come a year after the UAE ratified an extradition treaty with South Africa. President Cyril Ramaphosa’s administration first asked the Emirati authorities to extradite the two brothers in 2018, and the US imposed restrictions ranging from visa bans to asset freezes on them and another brother — Ajay Gupta — in 2019. The U.K. followed suit last year.

The UAE is under pressure to do more about tracking the money that enters the country. The Financial Action Task Force, a Paris-based organization set up by G7 countries to combat money laundering, on March 4 put the UAE on its “gray list” of jurisdictions that don’t do enough to uncover illicit funds. South Africa has meanwhile been warned that it will be included on the list unless it tightens up its controls.

The arrests reflects the “continuous efforts” by the UAE to combat money laundering, the Dubai police said in a statement.

The UAE’s legal processes require a country seeking extradition to provide a legal file containing charges and evidence within 60 days of an arrest, said Habib Al Mulla, a partner at the Dubai-based Baker & McKenzie Habib Al Mulla law firm, who isn’t part of the case. Authorities would then make a determination as to whether the extradition goes ahead, and the accused could potentially file an appeal, he said.

The arrests are good news for Ramaphosa. Besides bolstering his claim that he is committed to tackling graft, they will also serve as distraction from allegations that he sought to cover up the theft of cash from his game farm in the northern Limpopo province in 2020. He has denied any wrongdoing.

The Guptas first came under scrutiny in 2013, when it emerged that the family were allowed to use a secure military base to land a plane ferrying wedding guests to a lavish event at Sun City, the casino resort about two hours northwest of Johannesburg.

They and their allies were subsequently linked to the plunder of funds from state power utility Eskom Holdings and freight rail and ports operator Transnet. Both companies continue to perform sub-optimally, to the detriment of the entire economy.

The Guptas were also accused of playing a part in Zuma’s decision to sack Nhlanhla Nene as his finance minster and replace him with little-known lawmaker Des Van Rooyen — a move that caused the rand to crash. Van Rooyen was removed after four days following a public outcry.

In 2016, then-Public Protector Thuli Madonsela was asked to probe the dealings between Zuma, the Gupta family and state-owned entities and produced a damning 355-page report, called ‘State of Capture’. With Zuma still clinging to power, a vast trove of emails and documents between the Guptas and their associates was leaked in 2017. The governing African National Congress forced Zuma to quit in February 2018 to stem a loss of electoral support and the Guptas fled South Africa for Dubai.

South African authorities filed charges against the brothers later that year in connection with a questionable tender to undertake a feasibility survey on a dairy project in the central Free State province, in which a company they controlled was paid 21 million rand. That case is still before the courts.




Please enter your comment!
Please enter your name here