By Lehlohonolo Lehana.
The Nulane Investments trial began in the Free State High Court in Bloemfontein on Monday after all six accused in the Nulane R24.9m fraud and money-laundering trial have pleaded not guilty, after being formally charged at the start of the trial.
The National Prosecuting Authority (NPA) said that the absence of Gupta brothers, Rajesh and Atul, from the start of Nulane corruption trial at the Bloemfontein High Court was not expected to affect proceedings.
The NPA wants to prosecute the brothers for the alleged siphoning off of state funds in a botched R25 million rural development project.
Spokesperson for the NPA’s Investigative Directorate, Sindisiwe Seboka, said that South African authorities were still negotiating the extradition of the Guptas with United Arab Emirates (UAE) officials.
“The prosecution strategy has always been to proceed with the persons currently in the country and when the time comes, if the other jurisdiction so agrees, then we will continue with those that are currently here, so it does not have any bearing on this particular matter.”
In the dock are Peter Thabethe, the former head of the Free State Department of Agriculture and Rural Development; Limakatso Moorosi, a former accounting officer at the Department of Agriculture and Rural Development; and Seipati Dhlamini, the former chief financial officer of the Department of Agriculture and Rural Development.
The other accused are Iqbal Sharma, a high-flying businessman and former senior official in the Department of Trade and Industry; Dinesh Patel, Sharma’s brother-in-law and a representative of Sharma’s company Nulane Investments 204; and Ronica Ragavan, a long-time Gupta enterprise employee and director of Islandsite Investments One Hundred and Eighty.
The companies indicted are Nulane Investments 204 and the Gupta-owned Islandsite Investment One Hundred and Eighty, which is in business rescue.
The case is based on an alleged corrupt contract in which R24.9-million was paid by the Free State provincial government to Nulane Investments to conduct a feasibility study for the province’s flagship Mohoma Mobung project, on the basis that Nulane had unique skills to perform the work.
The contoversial Vrede dairy project was one of the programmes included in the Mohoma Mobung project.
The state began proceedings with prosecutor Jacyntha Witbooi reading the charges proffered against the accused into record. The accused face four counts of fraud, money laundering and contravening the Public Finance Management Act.
Sharma was the sole director of Nulane Investments — the company that landed the R24.9-million contract in the Free State in 2011. The State contends that there was no valid reason the due diligence agreement could not have been procured on the open market as the services offered by Nulane were neither “unique” nor “innovative”.
Additionally, the State alleges that Nulane Investments had no employees on its books, and Sharma is accused of having outsourced the service to Deloitte for a fee of R1.5-million — a fraction of what the provincial government paid to the company. Sharma then allegedly entered into another subcontract for exactly the same services, this time with a Gupta-linked company, Gateway Limited in Dubai.
Nulane’s subcontract with Gateway, the State contends, was a carbon copy of the one it entered into with Deloitte. The State maintains that this subcontract was merely a means to launder Free State government funds to the Dubai company for the ultimate benefit of the Guptas.
Once paid to Nulane, the majority of the cash was allegedly laundered and diverted through a scheme of transactions into and through different bank accounts and Gupta-linked entities.
This is the first State Capture case to proceed to trial and the matter is set for trial until 3 March.