Absa: Gordhan not empowered to intervene in Gupta row

JOHANNESBURG – Absa has argued in court papers that Finance Minister Pravin Gordhan is neither empowered nor obliged to intervene in the bank’s ...

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JOHANNESBURG – Absa has argued in court papers that Finance Minister Pravin Gordhan is neither empowered nor obliged to intervene in the bank’s decision to cut ties with the Gupta-owned Oakbay resources.

The bank filed papers in the high court in Pretoria on Thursday, becoming the latest institution to support Gordhan’s application for a declaratory order confirming that he cannot interfere in the decisions of banks concerning their client relationships.

Gordhan had previously been asked by some Cabinet ministers and Gupta family representatives to intervene, after four major banks cut ties with the Gupta family.

Absa says there’s no provision of the Constitution, National Assembly nor any legislation that empowers Gordhan to intervene in bank and client relationships as urged by the Oakbay companies.

It states in the affidavit that it believes any attempts to do so would be beyond his powers and therefore unlawful, constituting an impermissible intervention.

The bank says it was well within its rights to terminate its contractual relationship with Oakbay, saying it provided reasonable notice.

It cited evidence of large unexplained transfers of funds from Oakbay companies, the fact that the Gupta-owned company was not using Absa as a primary bank and that it was planning to move its banking business to alternative institutions as some of the reasons why the bank ended its relationship with the family.

Source: Absa: Gordhan not empowered to intervene in Gupta row

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