OpinionPoliticsState Capture

Banks push FIC amendment through back door – the courts

Pinky Khoabane

MlamboJudge President Dunstan Mlambo

EMERGING from the legal case between Finance Minister Pravin Gordhan and the Guptas is a terrifying picture of the power the banks seek from the courts. The banks seek absolutely no interference in their dealings – not from Gordhan, the Executive or the President of this country.

It is horrifying that South African banks are in court seeking God-like powers so that they can do as they please without any accountability to anyone. More horrendous is the absolute silence from civil society groups, human rights advocates and the liberal media on what is a shocking request for abuse of power and violation of individuals’ rights by the banks.

Gordhan was in the North Gauteng High Court seeking a declaratory order that he cannot interfere in the decision by the four big banks to close the Oakbay accounts. As we heard on the first day of the case, he had already been told by his counsel that he had no legal basis on which to interfere in the dealings between private banks and their clients. And yet, he went-on to investigate Gupta bank accounts and received the FIC certificate which had the 72 “suspicious transactions”, only 15 of which could be identified, according to a forensic report obtained by the Guptas. But not only that, he still went to a court of law seeking what he already knew.

As Advocate Cedric Puckrin for Oakbay put it: “The Supreme Court of Appeal held that even a court does not have the power or obligation to intervene in the private relationship between a banker and its client It is really remarkable that the minister seeks affirmation by this court of a decision that he took, that he was not empowered to intervene”.

The question to be asked is why the finance minister would pursue a matter which he knew he had no powers over. This is the question also asked by the full bench headed by  during the hearing – why, having been advised by his own legal counsel, he decide to still investigate the Oakbay accounts. Judge President Dunstan Mlambo put it bluntly – that he had no business in the dealings of the Oakbay accounts. It is left to us to speculate – well not really, given Advocate Jeremy Gautlet’s explanation of why the FIC certificate was important in the case. The FIC document served as a means by which Gordhan could assist the banks in explaining why they had closed the accounts and whitewash the notion that there was collusion and a political motive behind the closure. It must be remembered that the banks had refused to tell the Guptas why they had closed their accounts. Gauntlet said the FIC certificate was meant to show the extent of the financial impropriety. Given that he knew he couldn’t intervene, investigating everything thereafter, was simply sinister.

Through the Financial Intelligence Centre (FIC) amendment bill, the banks had sought the power to do exactly what they now seek in the North Gauteng High Court. To be able to decide which bank accounts they can close without accounting to anyone – from client right up to the president.

Through the FIC amendment bill they had sought to shift the work of law makers, the judiciary and the organisations that deal with prosecutions to themselves. They wanted to be able to go beyond simply flagging accounts that they thought to be involved in illegal financial conduct such as terrorism, corruption and money laundering – but to close the accounts without fair hearing from the account holder. They wanted to be the judge, jury and executioner.

It is preposterous that people deemed by the banks to be ‘politically influential persons” or “politically exposed persons” could, under the FIC amendment bill, have their accounts closed with no explanation given. Not that this isn’t happening already. In violation of the right to be heard, as protected in our Constitution, anyone who wishes to know the reasons for the closure would have to go to court.

The FIC amendment bill is awaiting President Jacob Zuma’s signature and with the delay, the finance minister’s request for a declaratory order not to interfere with the banks’ business has offered banks the sinister opportunity to enact the FIC amendment bill through the back door.

South Africa’s untransformed courts have become a platform from which those who, having taken cognisance of the fact that they couldn’t dominate politics through the ballot, have decided to influence policy through the courts.




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  1. I noted with interest comment by former deputy judge president Moseneke about the involvement of courts
    To resolve political differences. I think the banks lost an opportunity to give reasons to inform South Africans why they closed the Oakbay bank accounts,with the inclusion of FIC certificates by the minister
    I believe banks had a duty to take the courts into confidence and address what they seem to acknowledge
    That there is public interest in these regard.

    1. Dear Sam

      I think you hit the nail on the head by questioning why the banks didn’t disclose their reasons but they wield so much power that they don’t have to disclose anything to anyone even the courts.
      They were not there to bridge the gap of mistrust the public has with them – they were there seeking more powers to put themselves on a pedestal which none of us – the ordinary citizens have.



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