Responding to the Oakbay company employees’ call, the cabinet has assigned three ministers to ‘interact’ with South Africa’s big four banks about their reasons for closing up the investment’s account.
Speaking after the cabinet’s brief meeting, minister in the Presidency Jeff Radebe said the ministers of finance (Pravin Gordhan), mineral resources (Mosebenzi Zwane) and labour (Mildred Oliphant) wouldbe having a “constructive engagement” with the banks about the closed accounts of “a company”.
The four big banks namely Absa, FNB, Standard Bank and Nedbank have withdrawn business with Gupta’s Oakbay following the widespread allegations of state capture by the family.
The investment’s employees who have been hit by the heat of the situation pleaded with the banks and the cabinet to reconsider opening up the company’s account as they are at risk of losing their jobs at the company.
However, Mr Radebe said: “While the cabinet appreciates the terms and conditions of the banks, their actions might deter investors who want to do business in South Africa.”
He further carefully noted that the cabinet’s decision to send in the three ministers was made at an April 13 meeting‚ before it emerged that one of the reasons for the banks’ actions could be compliance with money laundering regulations.
According to him, the ministers were not conducting an investigation but entering into an “engagement”.
The mineral resources minister, Zwane, is understood to be very close to the Gupta family but Redebe did say whether Zwane should be part of the interactions.
Radebe said the minsters are not going to include bullying in the “engagement” as “there are big boys and girls in the banks who cannot be bullied.”
When asked if the cabinet’s approach to this particular situation would be used to deal with other private companies, or whether companies could approach the government to act on their behalf in similar situations, Radebe said only that the government and private companies often interacted.
Meanwhile, Political analyst Ibrahim Fakir said the banks were clearly unethical in the way they went about the closing the Oakbay investment issue. However, he accepts the fact that the Guptas or their companies ought to have followed due process before the ministers get involved.”
Reacting to the appointment of ministers by the cabinet, the Economic Freedom Fighters (EFF) said such decision means the cabinet has “resolved to officially intervene in business and private affairs of a family business which has a corrupt business relationship with Mr Jacob Zuma”.
By this, EFF’s EFF’s Mbuyiseni Ndlozi said the government relagated itself into a “personal fiefdom where a president reduces institutions of the state and cabinet ministers into defending his personal and private interests.”
Ndlozi said that the banks’ decisions to not deal with Gupta-related companies “should be welcomed” if it came from their choice “to disassociate from and report all forms of financial crimes and impropriety by their customers”.
“The EFF rejects cabinet’s narrow intervention into private affairs of the Gupta family and instead calls for strengthening of laws that deal with financial crimes‚” he said.
“All banks‚ audit firms‚ and other financial institutions must play a central role in combating all forms of financial crimes.”