This article is from the source 'independent' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.independent.co.uk/news/business/news/government-probe-hsbc-standard-chartered-gupta-family-south-africa-links-a8008346.html

The article has changed 4 times. There is an RSS feed of changes available.

Version 0 Version 1
UK urged to investigate HSBC and Standard Chartered over links to South Africa’s Gupta family HSBC and Standard Chartered face UK investigation over ties to South Africa's Gupta family
(about 7 hours later)
The UK has asked financial enforcement agencies to probe possible ties between HSBC and Standard Chartered to South Africa’s Gupta family, the Financial Times reported. UK regulators are looking into whether HSBC and Standard Chartered facilitated money-laundering as a result of possible ties to South Africa’s politically powerful Gupta family.
Chancellor Philip Hammond said that he had passed on concerns from Peter Hain, a former Labour cabinet minister, that the London-based banks might have handled illicit funds linked to the family via Hong Kong and Dubai, the FT said. The Financial Conduct Authority probe comes after Peter Hain, a member of the House of Lords, wrote a letter raising concerns about the banks’ possible exposure to the Guptas. In the letter, Mr Hain said allegedly illicit funds may have passed through the United Arab Emirates and Hong Kong, where HSBC and Standard Chartered had large footprints.
The Guptas are at the heart of a political scandal in South Africa over allegations that they used a friendship with President Jacob Zuma to influence state business. Mr Zuma and the Guptas have denied any wrongdoing. “It will be no secret to financial crime experts that criminals target large and credible financial institutions for the same reasons that legitimate multi-national networks do - for their global reach,” Mr Hain said in the 25 September letter to Chancellor Philip Hammond. “I have deep concerns and questions around the complicity, whether witting or unwitting, of UK global financial institutions in the Gupta/Zuma criminal network.”
Mr Hain did not accuse HSBC or Standard Chartered of wrongdoing but, in a letter to Hammond, said that they should review transactions due to evidence, including material from whistle-blowers, that hundreds of millions of South African rand were laundered out of the country, according to the FT. The three Indian-born Gupta brothers are at the heart of South Africa’s biggest post-apartheid scandal. South African opposition groups, campaigners and investigators accuse them of using their friendship with President Jacob Zuma and business partnership with his son to make millions of dollars from state contracts. Hain asked the authorities to investigate Zuma, 10 of his family members, 11 Gupta family members, and five other associates, as well as 14 entities linked to them.
In reply, Hammond said that he had contacted the Financial Conduct Authority, Serious Fraud Office and National Crime Agency in the UK, the paper said. In a question to the House of Lords on Thursday, Hain also requested the authorities look into India’s Bank of Baroda, which is the last bank to hold bank accounts for Gupta companies. South Africa’s central bank in June fined Baroda’s South African unit 11 million rand (£616,000) for lapses in its financial crime prevention measures.
According to the FT, the FCA said it was “already in contact with both banks named and will consider carefully further responses received.” Spokesmen for HSBC and Standard Chartered declined to comment. Standard Chartered said while it wasn’t able to comment on specific client transactions, it could “confirm that after an internal investigation, accounts were closed by us by early 2014.“
“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.
HSBC and spokespeople for the Guptas and Mr Zuma all declined to comment. Mr Zuma and the Guptas have always denied any wrongdoing. Baroda didn’t immediately respond to phone calls and an email requesting comment.
The Treasury passed Hain’s letter on to the FCA and prosecutors at the National Crime Agency and Serious Fraud Office, saying “we take allegations of financial misconduct very seriously.”
The FCA said in a statement that it had already contacted both banks named in the Hain letter and “will consider carefully further responses received.”
An SFO spokeswoman said the agency was aware of the allegations, but couldn’t comment on them at this time. The NCA said in an email that it was “aware of and reviewing the information.”
London’s Guardian newspaper reported on the Treasury’s request earlier.
BloombergBloomberg