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The Estina dairy farm in Vrede. (Conrad Bornman, Netwerk24)
- The Estina company, run by Gupta, was allegedly used to launder money even before the Free State dairy project began.
- Paul Holden, director of investigations for Shadow World Investigations, testified before the Zondo commission on Thursday.
- It alleged that the cash was laundered “through a very complex system.”
An investigation director at Shadow World Investigations, a global organization that investigates grand corruption cases, told the Zondo commission that Estina was allegedly used to launder money prior to the Free State dairy project.
“Estina was effectively being used as a front for money laundering by the Gupta company a year before the Free State dairy project started,” Paul Holden told the commission Thursday.
He gave evidence on the flow of extraterritorial money from Estina.
Holden told the commission how the Guptas, through their various offshore companies, allegedly used Estina to launder cash “through a very complex system.”
Estina was identified in early 2012 as the company that would partner with the Free State government on the dairy farm project.
At that time, the plan was for Estina and the Department of Agriculture and Rural Development to inject an investment of R500 million into the project.
In June 2012, the department launched the project with R30 million for Estina, but the money continued to flow into Estina’s coffers, News24 previously reported.
READ | The Zondo commission hears how the Estina dairy farm was allegedly used as a front for money laundering
The contract was canceled in August 2014.
On Thursday, Holden said that what they were able to uncover from the material from the Gupta leaks was that from about 2010 to about 2014 the Gupta company in South Africa partnered with a group of companies called the India-based World Window group.
He added that the two parties were engaged in “quite [a] substantial amount of money laundering “in South Africa and abroad.
“The World Window group achieves this partially by creating South African-based entities through which it transacts.”
“In relation to this, we know the existence of this particular relationship because at a certain point Ronica Ragavan [Gupta loyalist] send [an] email to Ashu Chawla [Gupta associate] Attaching a spreadsheet that is a transaction record of all payments to and from the Gupta business companies and the World Window companies. Then we can trace the disposition of funds from those two criminal networks. “
Holden told the commission that the Free State government’s first payment to Estina was made in June 2012, but on May 3, 2011, which was more than a year before the projected dairy farm began, when an employee From World Window sent an email to Ashu Chawla asking him to invoice Estina, detailing what the company should invoice.
“He gives an amount that is the exact amount that was outstanding on the loan from the Bank of Baroda. So effectively, the Window of the World is billing Estina so that Estina can make a transfer to pay off the loan,” he testified.
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Holden said it was “pretty apparent” that the Bank of Baroda in South Africa was aware of the true nature of the transactions.
Earlier, he said that the total amount that the Free State government paid Estina was R280 million plus R7 million in interest.
The money was paid in eight separate installments between July 9, 2012 and May 5, 2016, Holden added.
He claimed that the 287 million rand was “laundered” three times, and eventually the money deposited in Estina amounted to 880 million rand.
And only R35 million [3.9%] of that amount did not come from the Free State government, Holden said.
