The South African Revenue Service (SARS) illegally paid at least R420m in tax refunds claimed by Gupta companies into an attorney’s trust account, to a shelf company and to a shady businessman who was once involved in business with Tom Moyane’s nephew.
This came at a time when Bank of Baroda was reducing its Gupta exposure because they could no longer hide, nor stomach, the Guptas’ money laundering activities. The scheme contravened the very laws SARS must administer. It is a crime of VAT fraud and money laundering directed by Oakbay CEO Ronica Ragavan, effected by dodgy business people and sanctioned by SARS. This is how SARS kept the Guptas in the money laundering business after the banks they abused slammed the door.Much like the #GuptaLeaks is a snapshot of how the Gupta empire hijacked and repurposed the state machinery, the evidence collected by Scorpio and News24 now offers a snapshot of how the Gupta empire was kept in the game when they ostensibly struggled to be banked.
Previously, three dodgy VAT refund payments to a Gupta pay agent from June 2017, totaling R70m, made national headlines earlier in 2018, ensuring SARS was added to a long list of state entities compromised by the architects of State Capture.
Commissioner Tom Moyane was suspended in March 2018, three days after Scorpio revealedhow SARS’ head of legal Refiloe Mokoena invoked his name to strong-arm SARS officials into releasing VAT refunds claimed by the Gupta companies.
Scorpio and News24 can now reveal that these three payments were merely the tip of a VAT fraud and money laundering iceberg. Our investigation is based on bank statements, an audit report on Bank of Baroda, SARS emails, court documents in three ostensibly unrelated matters as well as interviews with eight insiders and two VAT specialists collected over a period of more than six months.
We found that SARS paid over R420m in VAT and personal income tax refunds claimed by the Gupta companies and individuals in the 17 months between December 2016 and April 2018.
Seven months before News24 revealed the VAT refund payments in June 2017, SARS’ internal policies were already compromised at the behest of the Gupta empire. The first batch of R35.8m in VAT refunds was paid into Estelle de Jager’s attorneys trust account. The second batch of an alleged R200m was paid into the account of a pay agent, Terbium, who once received a dodgy debt collecting contract from SARS because it was in business with Commissioner Tom Moyane’s nephew.The last batch of R183.3m was paid into a shelf company created on instruction of Oakbay CEO Ronica Ragavan, named In House Wages.Our investigation shows SARS’ systems were compromised at least three times by SARS officials colluding at behest of the Guptas.Commenting on detailed questions, acting Commissioner Mark Kingon took on a very different stance to his predecessor Moyane. Said a SARS spokesperson when presented with detailed questions over the Guptas’ VAT fraud:“Earlier this year the acting commissioner of SARS requested his office to conduct an end-to-end review of the matter based on what was available in the public domain at the time. The review included internal governance processes and procedures. The acting commissioner received an interim report, but at this stage information relating to the number of third parties and the value of refunds is limited to what is available in the public domain.”(Read SARS’ full comment here.)