Financial regulators in the United Kingdom and the country’s Serious Fraud Office have launched an investigation into whether HSBC and Standard Chartered banks facilitated money laundering. They are trying to verify if the institutions’ links with South Africa’s politically powerful and Indian-born Gupta family led to the violation of the laws, Bloomberg reported on Thursday.
The United States Federal Bureau of Investigation has also opened an inquiry into links of US banks and individuals with the Gupta family, the Financial Times reported.
The Guptas are considered close to South African President Jacob Zuma, and have been accused by civil society groups of using that relationship to influence state contracts and cabinet appointments in the country. The UK investigation has been initiated after Peter Hain, a member of the House of Lords, wrote a letter to UK Chancellor Phillip Hammond, raising concerns about the banks’ possible dealings with the Guptas.
“I have deep concerns and questions around the complicity, whether witting or unwitting, of UK global financial institutions in the Gupta/Zuma criminal network,” Hain wrote to the chancellor. On Thursday, he told UK’s House of Lords that up to £400 million (Rs 3,428 crore) of illicit funds may have been moved by the banks through the United Arab Emirates and Hong Kong.
India-based Bank of Baroda has asked for a court order to close the Gupta family’s accounts in South Africa. Standard Chartered said on Thursday that it had closed the Guptas’ accounts after an internal investigation in 2014, while HSBC refused to comment, Bloomberg reported.
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