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*Update: This article contains an updated response from ABSA, the bank says it is not targeting Zuma's family.
Johannesburg – ABSA bank has threatened to close the bank account of President Jacob Zuma’s wife, Tobeka Madiba-Zuma over suspicious flows.
This is according to a report by the Sunday Times, which indicated that the bank wants Madiba-Zuma to explain large flows into her account.
The bank had previously closed the accounts of Gupta-owned companies in February 2016. According to an affidavit filed by ABSA in December 2016, the bank had been reviewing the companies which fell into the definition of politically exposed people (PEP), in terms of a guidance note issued by the Financial Intelligence Centre (FIC).
READ: Absa weighs in on Gupta bank account closures
In the affidavit the bank highlighted that the Financial Intelligence Centre Act (FICA) sets out that the controls and mechanisms to identify high risk customers which include PEPs. PEPs further present a higher money laundering risk, Fin24 previously reported.
Strict controls
The South African Reserve Bank (SARB) had fined ABSA R10m in 2016 for weaknesses in the bank's controls related to monitoring transactions. In addition the bank was instructed to take remedial action to address shortcomings of its measures.
The penalty was in line with FICA, which indicates that a supervisory body such as the Reserve Bank can impose an administrative sanction on a bank for its failure to comply with provisions of the act, explained the SARB.
ALSO READ: SARB fined banks R46.5m in 2016 for control weaknesses – report
The Sunday Times report also indicates that the president’s son Duduzane Zuma’s bank accounts were closed, who then appealed to chief executive Maria Ramos for assistance.
On Monday, ABSA responded to Fin24's request for comment. A spokesperson explained that the bank could not speak on the matter relating to President Jacob Zuma's wife nor his son due to customer confidentiality obligations. "Only a client can disclose who they bank with," the spokesperson said.
The spokesperson explained that the bank does not threaten to close customer accounts, but communicates their decision to do so to the customer, with "sensitivity and discretion".
“We are also not targeting the Zuma family as the article
suggests. We do not target customers. We simply carry out risk assessment work
in line with the law, regulations and bank policy.”
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