A call for bank oversight

The four largest banks in South Africa – Absa, First National Bank, Standard Bank and Nedbank – recently announced they would unilaterally close the bank accounts of companies associated with the Gupta family in South Africa.

The banks’ action comes as it is become increasingly clear to the public that the Guptas in South Africa exercise considerable influence over President Jacob Zuma. The claim is that this extends to members of the family even being able to offer cabinet posts. Their influence is so pronounced it is alleged that state capture has taken place.

The Gupta family has established a network of companies in South Africa ranging from media to mining employing thousands of people. One of the Gupta affiliated companies affected by the closures is Oakbay Resources and Investments which is traded on the Johannesburg Stock Exchange.

These particular bank account closures are unprecedented in South Africa in two respects: the accounts do not appear to have been closed because of objective economic reasons such as the companies being about to default – the usual reason for such a step. Also, all four banks took the same step.

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