Gupta’s phony trading leads South African banks to sharpen anti-money laundering regimes

The corruption scandal in South Africa centred on former president Jacob Zuma’s dealings with the country’s wealthiest Gupta family has prompted banks there to look closely at their anti money laundering and counter financing of terrorism (AML/CFT) measures.

The alliance of the former South African leader and the business moguls – dubbed ‘Zupta’ – used shell companies, mysterious trades and suspicious cash transactions that eventually caught the attention of regulators in various jurisdictions.

Presidential exit

Zuma’s involvement in Zupta was one of the reasons he was forced to resign, as it inflicted severe damage on one of Africa’s biggest economies.

Zupta is reported to have drained billions of rands from government institutions by orchestrating awards of government contracts to offshore shell companies.

Bank involvement

Suspicious cash flows from banks in South Africa, UAE, China, India, the US and Canada were eventually revealed through banks’ internal compliance procedures or regulators.

Banks caught up in Zupta’s suspicious transactions are thought to include ABSA, the Bank of Baroda’s South African branch and the State Bank of India.

Categories: Trade Based Financial crimes News

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