FBI to Probe U.S. Links to Gupta Family of South Africa: Report

The Federal Bureau of Investigation (FBI) will be investigating U.S. links to the Gupta family, who have been in the eye of an alleged graft case, which includes President Jacob Zuma of South Africa, the Financial Times reported citing people familiar with the matter. The FBI has been investigating bank accounts and companies in the United States related to the Gupta brothers‘ nephews, Amol and Ashish.

The three Indian brothers — Ajay, Atul and Rajesh Gupta — went to South Africa in the 1990s and are close friends of President Zuma, whose African National Congress (ANC) will be voting soon to choose a successor. The graft case with Gupta is one of many controversies surrounding the septuagenarian politician.

After a request from Chancellor Philip Hammond, UK regulators told two private banks, HSBC Holdings Plc and Standard Chartered Plc, to review any dealings with the Gupta family. The HSBC Holdings Plc has not commented on the matter. StanChart, however, said that it could “confirm that after an internal investigation, accounts were closed by us by early 2014,” according to the Financial Times.

“Standard Chartered takes its responsibility to combat financial crime very seriously and is fully committed to doing business in accordance with local and international regulatory and legal requirements,” the London-based bank said in a statement.

Bank of Baroda’s Role

The UK regulator, The Financial Conduct Authority (FCA), began the investigation after Peter Hain, a member of the unelected House of Lords, wrote a letter saying that illicit transactions could have been done through the United Arab Emirates and Hong Kong. India’s Bank of Baroda could also be involved in the investigation as it was the last bank to hold accounts for the Gupta companies.

Bank of Baroda’s South African branch was fined for 11 million rand ($813,000) last month by the country’s central bank for failing to take measures to prevent financial crimes.

The U.S. Investigation

The investigation in the United States is focused on American citizens Ashish and Amol Gupta, who, according to Texas tax records, are directors of Brookfield Consultants Inc – a Houston-based company. The company had received a payment in 2014 from Accurate Investments, a United Arab Emirates-based firm associated with the Gupta brothers.

The Financial Times reviewed email leaks from companies owned by the Gupta family. Thousands of emails highlighting the graft, involving Zuma and several state-owned companies, their CEOs and board members, in South Africa, came to light. The emails were leaked in May 2017. It was also said that the Gupta family dictated cabinet minister-level appointments in South Africa. However, the Gupta brothers and Zuma have denied any wrongdoing.