Guptas deny trying to capture R51 billion Prasa tender

 ·19 Jun 2016
Prasa rail train

The Gupta family has denied it attempted to capture the R51 billion Passenger Rail Agency of SA (Prasa) tender on behalf of a bidder in 2012, as alleged in a letter written by former CEO Lucky Montana.

The denial comes as the AmaBhungane Centre for Investigative Journalism, writing in the Sunday Times on Sunday, revealed a new example of alleged state capture by the Guptas.

At the basis of the allegation is a letter that Montana wrote in 2012 to then Prasa board chairperson Sfiso Buthelezi.

In the letter, Montana accuses the Guptas and the president’s son Duduzane Zuma of trying to take control of Prasa’s board to ensure their alleged bidder – the China South Rail (CSR) – won the R51 billion rolling stock tender to supply Prasa with 600 commuter trains.

This adds a new twist to the Prasa locomotive saga. It has seen the resignation of Montana and a report by Public Protector Thuli Madonsela that criticised Montana’s role in the matter. It resulted in Prasa chair Popo Molefe seeking legal action to end Swifambo Rail Leasing’s contract in 2015. This week, Molefe filed papers trying to recoup R2.6bn from company for the 13 locomotives.

The City Press reported on Sunday that Montana allegedly instructed his very own “go-to IT guy” to wipe clean a laptop that was thought to have contained “sensitive” documents relating to the troubled state-owned entity after he had been dismissed.

What the letter claims

The alleged letter claims Montana attended meetings with Transport minister Ben Martins and other transport ministry advisers, where he was introduced to representatives of Gupta family and Duduzane Zuma.

“I had taken issue with the representative of the Gupta family over what I considered to be attempts on their part to ‘extort’ money from (the bidders),” he reportedly wrote.

Award-winning investigative journalists Sam Sole and Stefaans Brümmer, who authored the Sunday report, said the letter claims the Guptas proposed giving CSR “shares” to Montana and demanded Martins restructure the board.

The letter appears to have been a threat on Montana’s part to quit if the board restructure – which he claimed was imminent – was not halted. The letter seemed to work, the restructure was averted and French-backed Gibela won the bid.

Speaking to Fin24 on Saturday ahead of the Sunday report, Gupta spokesperson Gary Naidoo – who had seen the letter and was sent a list of questions by AmaBhungane –  said “the allegations are without foundation”.

Guptas want focus to move from state capture to media capture

“We have no interest absolutely in the rolling stock tender that’s been put out and therefore we totally deny any of the claims in the supposed letter,” he said.

Naidoo questioned who the Gupta representative was, saying “we believe anyone can claim to represent the family”.

AmaBhungane sent Montana’s letter to the Guptas, but not in its original format to protect their source. The Guptas told them they would not comment on the story without seeing the original.

The letter “does not have any authentication or verification as far as we can see”, said Naidoo. However, both Montana and Buthelezi confirmed the authenticity of the letter to AmaBhungane in the Sunday Times report.

“We have no bearings on anything that is happening with the current case with Prasa,” he said.

He claimed there is a “politically-coordinated campaign against us” being conducted with the use of the media. “We believe strongly that this is another example of media capture,” he said.

While this story has a clear source, the media often runs stories with unnamed sources to protect the identities of government officials and other high ranking officials, who could lose their jobs for sharing sensitive information.

Call to bring evidence of state capture into public sphere

However, Naidoo called on those with information that shows the Guptas are indeed guilty of state capture to “bring it out”.

“Put it out there, charge us if you will, but you can’t make unfounded statements and have unnamed sources because then it’s just all innuendo,” he said.

He said the Guptas have not had any formal correspondence with the public protector, who is said to be working on an investigation into the Guptas regarding accusations of state capture.

Madonsela said in June she was seeking additional resources so she could sufficiently probe the allegations.

While the Democratic Alliance laid charges of corruption against the Guptas in March, Naidoo said they have received no indication of this legal matter, or any other related legal matter.

Asked why the Guptas don’t take legal action to clear their name of state capture, Naidoo said: “The family is a very private family so they wouldn’t really like to go too deep into the public sphere.”

“But, having said that, they reserve their rights over various things that have happened over the last few months,” he said. “For now, we’d like some peace and quiet and want things to go on as normal.”


More on Prasa

Guptas in alleged Prasa capture through R51 billion tender: report

Suspended Prasa workers paid R37 million to stay at home

Prasa finance chief ‘hasn’t been at work for quite a long time’

Zuma’s friends score R80 million from Prasa dealings: report

Prasa wants a refund for its R2.65 billion train blunder

10 of Thuli Madonsela’s findings against Prasa

Prasa’s culture of hiding information: report

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