- Thomson Reuters
- Chancellor Philip Hammond has asked regulators to look into allegations of money laundering relating to the Gupta family and South Africa’s President. Lord Peter Hain raised concerns British banks may have been used to move money out of South Africa illegally. The banks are not accused of wrongdoing.
LONDON – Chancellor Philip Hammond has asked UK regulators and law enforcement to look into whether British banks may be implicated in the illicit movement of funds out of South Africa – part of the corruption inquiry into alleged ties between the powerful Gupta family and President Jacob Zuma.
The Chancellor has asked the Serious Fraud Office (SFO), Financial Conduct Authority (FCA) and National Crime Agency (NCA) to look into the possibility that banks including HSBC and Standard Chartered were used as part of an alleged money laundering scheme, after concerns were raised to him by former Labour cabinet minister Lord Peter Hain.
Hain does not accuse the banks of wrongdoing.
According to letters seen by the Guardian, Lord Hain wrote to Hammond last month after whistleblowers told him that hundreds of millions of pounds had been illicitly moved out of South Africa via Hong Kong and Dubai, and that UK banks may have been compromised, since they have strong presences in those financial centres.
Lord Hain allegedly suggested banks, including HSBC and Standard Chartered, should review transactions that involved individuals and companies tied to the Guptas and to Zuma.
Both the Guptas and Zuma deny allegations of corruption and that their relationship gave the Gupta family an unfair level of influence over politics, which also benefited them financially.
Earlier this year, British PR firm Bell Pottinger collapsed after becoming embroiled in the scandal, after it was ejected from the UK PR industry body for allegedly helping stir up racial hatred on behalf of the Guptas.
The Treasury told the Guardian in a statement, “The government takes such allegations seriously and that’s why the letter has been passed on to appropriate authorities. It’s now for the authorities to determine what action to take.”
A spokesperson for the FCA told the newspaper that it was “already in contact with both banks named and will consider carefully further responses received.”
Standard Chartered said, “We are not able to comment on the details of client transactions, but can confirm that after an internal investigation, accounts were closed by us by early 2014.”
HSBC declined to comment.