The latest exposé of the Gupta and Zuma families’ love affair with Dubai in the Sunday Times did not come as much of a surprise.
The Guptas have long been purported to have exported their gains to the emirate, where they, or possibly President Jacob Zuma, own an opulent property and, where, they are expected to settle if they need to leave SA.
Dubai is the largest city in the United Arab Emirates (UAE). It is best known for being a business hub for the Middle East and a transport hub for passengers and cargo.
Oil was discovered there only in 1966 and although it helped to accelerate development, it accounts for less than 5% of Dubai’s revenue, and oil reserves are expected to be depleted within 20 years.
Dubai has a population of 2.7-million people, with 15% of the population nationals and 51% of Indian descent. It is regarded as one of the most expensive cities in the world to live in. The main religion is Islam, with its very strict moral codes. The legal system includes both civil and criminal courts, as well as a sharia court.
In order to diversify its revenue streams, Dubai has gone to great expense to position itself as an international financial centre for the Middle East and has two stock exchanges and an independent risk regulator.
Similarly to our Financial Intelligence Centre Amendment (Fica) Act, Dubai has adopted specific legislation to combat illegal financial activities that can jeopardise the stability of the markets. The legislation is enforced by the Dubai Economic Security Centre, which is responsible for combating corruption, fraud, embezzlement, bribery, the destruction of public property, forgery, counterfeiting, money laundering, terrorism financing and illegal organisations.
The UAE is not one of the countries that does not extradite — like Russia or North Korea. The emirates has signed extradition treaties with other countries — its treaty with SA has not yet been signed.
The lack of an extradition treaty does not mean that a person cannot be extradited, particularly if the framework for the treaty already exists. The conditions for extradition are fairly standard. It may be requested for the purpose of interrogating, prosecuting or executing criminal judgments, with the only requirement being that the crime must be punishable by more than one year in prison.
The UAE may refuse to extradite if a person is a citizen of the country; if the crime is political in nature; if the extradition request is meant to punish a person due to race, religion, nationality or political views; or if the person has been acquitted of the crime. Passage of time is also an issue, with five years seen as a benchmark. And if the person could be subject to torture or inhumane treatment that does not conform to the crime, extradition may not be granted.
Dubai could be viewed as a place where people can buy influence with 30 pieces of silver. If that silver comes from nefarious business practices, or if it is part of a money-laundering scheme, it is more likely that Dubai will clamp down on those involved than shield them from the laws of another country.
On the one hand, individuals can buy short-term influence by transferring money into Dubai’s bank accounts, setting up a company and buying a few properties. They may even forge relationships with scions of the ruling family.
But on the other hand, rands translated into dirhams — even a few billion rand — do not a fortune make in the Middle East. Relationships in a country that shuns expats as "working classes" are there to be discarded on whim.
And then there is the bigger picture. Would Dubai really want to face international headlines that portray it as a safe haven for financial criminals, a country that turns a blind eye to money laundering? Would it laugh in the face of Fica? Would it ignore extradition requests from countries for its citizens wanted for financial crimes?
Would it risk the reputation it built for a handful of people, however many houses they bought or money they shielded in Dubai’s banking system? Would it want to be known as being party to the exploitation of the poorest strata of society in SA for the personal gain of a few?
If I was a betting person, I would guess that those who rely on Dubai as their safe harbour should rethink their plan. Governments come and go. Those involved in the plunder of SA will be brought to justice. When they are, I would guess that diplomatic relationships between SA and Dubai, and its reputation in the eyes of the world, will trump vested interests of a few people. The gilded cage that Dubai seems to offer may well turn into the steel bars of Pollsmoor Prison.
• Wierzycka is Sygnia Group CEO
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