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Dude, where’s our plane? Canada wonders after lending millions for corruption-hit tycoon’s private jet

South Africa's Gupta family borrowed $41 million from Canada's Export Development Corporation to buy a plane. Now the bank is suing to try and get it back.

by Kieran Delamont
Mar 6 2018, 9:54pm

Canadian Press

A private jet owned by the Guptas, an Indian-born South African family, that was purchased with money lent to them by the Canadian government is missing, as further arrest warrants are being issued for members of the family who loom large in the corruption scandal that took down former South African president Jacob Zuma.

Export Development Canada (EDC), a crown corporation that supports businesses who are looking to buy Canadian products, loaned US$41 million to the Gupta family in 2015 to help them buy a Bombardier Global 6000 private jet. Lawyers for the EDC were scheduled to appear in a Johannesburg court on Tuesday in an effort to repossess the jet, but the hearing was postponed until Friday.

Canadian banking officials fear the Guptas, enmeshed in a series of corruption and influence peddling scandals in South Africa, have been using the jet to escape authorities. Last month, the EDC attempted to have the plane’s registration revoked, which would prevent it from flying or being sold. But first they had to find it. By that point, the jet had disappeared from public flight trackers (apparently at the request of the owners). Since then, South African media have reported, that the plane had been spotted in Zurich, Dubai and Russia. On Tuesday, Corporate Jet Investor reported that the plane had returned from Russia and had landed in Dubai.

Critics of the jet financing deal say that the EDC should have scrutinized the Gupta family more closely before lending them such a significant chunk of change. Phil Taylor, spokesperson for the EDC, said that they were limited in what they could discuss publicly, since court proceedings are still ongoing. “We believe our actions speak clearly about our position,” he told VICE News in an email, without elaborating.

'ESCAPING JUSTICE'

The EDC has claimed that it did its research on the Guptas when it chose to loan them $41 million in 2015, but even at that point the Guptas political influence in South Africa had been well-publicized. The EDC has earned a reputation for being relatively undiscerning in who it will loan money to, and it is unclear whether or not it ever carried out a thorough vetting of the Guptas.

In December, the EDC scrapped the deal after the Guptas defaulted on the loan in October. They still owe the EDC a reported US$27 million.

It’s unclear to just about everyone why the EDC chose to loan the money to the Gupta family; technical exemptions from the Access to Information Act have rendered the EDC something of a black box when it comes to transparency. “The Gupta deal suggests there is almost no entity that EDC won’t bank,” wrote Richard Poplak in a recent article in The Walrus. “Its activities are protected by disclosure protocols that are entirely opaque.”

It’s just the latest in the ongoing drama of the Gupta family, which spans multiple continents and has found Canada’s crown-owned development bank ensnared (if tangentially) in the same corruption scandal that ultimately ended Zuma’s presidency.

In February, South African authorities issued an arrest warrant for Ajay Gupta on corruption charges, alleging that the family had used their close ties to Zuma to win lucrative government contracts.

Zuma’s ties to the Gupta family—which have been steadily reported in South African media since at least 2010—were one of the focal points of his alleged corruption, and ultimately figured heavily into his resignation on February 14.

The EDC’s main concern was that the jet would be used to help Gupta evade South African law enforcement. “There is a very real concern that the aircraft may be used to escape justice for some unlawful means,” said the EDC in court documents filed in Johannesburg, South Africa.

So far, it appears that that is exactly what is happening: Ajay Gupta has been on the lam since a warrant for his arrest was issued on February 15, the day after Zuma resigned from office. Last weekend it was revealed that South African officials had also issued secret arrest warrants for Atul and Rajesh Gupta, Ajay’s brothers.

This week, trouble has been mounting for the Guptas, as various law enforcement agencies close in on the family. On Tuesday, a number of properties linked to the Guptas were raided by Indian tax officials, who have been investigating the family’s business dealings. The Guptas are also reportedly being investigated by the FBI, according to the Financial Times.