Court ruling on Gupta firms' Baroda accounts to see 7,000 jobs lost?
The ruling on Thursday means the India-based bank can go ahead and close the companies’ accounts at the end of this month.
JOHANNESBURG - The High Court's rejection of a bid by nearly two dozen Gupta-owned companies to keep their Bank of Baroda accounts open may be the final nail in their coffin and could lead to more than 7,000 employees losing their jobs.
The ruling in Pretoria on Thursday means that the India-based bank can go ahead and close the companies’ accounts at the end of this month.
The court affirmed the bank's concerns around alleged unlawful.
South Africa's big four banks have already cut ties with the controversial family.
While the Guptas have not responded to the court’s decision, Oakbay chief executive Ronica Ragavan has set out in an affidavit the effects that the Bank of Baroda closing their accounts would have.
She says it would take away their sole remaining banking facility and leave them without any access to bank accounts.
This means that the companies would be unable to hold and receive funds, pay debts to contractors and suppliers or their employees’ salaries.
The effect would be the companies’ complete inability to satisfy its liabilities or to continue to conduct business here in South Africa.
Meanwhile, the Organsation Undoing Tax Abuse (Outa) has announced it will approach the courts to freeze funds worth nearly R2 billion in the Gupta Baroda accounts, to stop the cash from disappearing.