Businesses linked to the Gupta brothers raised about R1bn in bank loans secured against properties originally purchased for less than a tenth of their bond values, the Organisation Undoing Tax Abuse (Outa) said on Thursday. "The Bank of Baroda provided bonds valued at R811m and the Bank of India provided bonds of R176m; the remaining R11m came from FirstRand. The transactions linked to the Bank of Baroda and the Bank of India are particularly problematic," Outa chief operations officer Ben Theron said. For example, the Guptas’ company Islandsite 180 bought two Cape Town flats in 2006 for R2.8m each and two years later the Bank of India generously provided bonds of R24m on each flat. This was 8.5 times the purchase price, Outa said in its statement.
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