Sanjeev Gupta’s GFG Alliance faces fraud probe in Britain

The company owned by steel magnate Sanjeev Gupta is facing a high-level probe in Britain amid allegations of fraud and money laundering.

Sanjeev Gupta, head of GFG Alliance. Picture: AFP

The company owned by Whyalla steel magnate Sanjeev Gupta is facing an investigation by the UK’s anti-corruption regulator amid allegations of fraud and money laundering as well as financing links with collapsed finance company Greensill Capital.

The investigation by the UK’s Serious Fraud Office into companies inside the Gupta Family Group (GFG) Alliance, confirmed late Friday AEST, comes just weeks after the steel magnate secured an Australian financing deal to stave off demands for funds from creditors of Greensill.

“The SFO is investigating suspected fraud, fraudulent trading and money laundering in relation to the financing and conduct of the business of companies within the Gupta Family Group Alliance (GFG), including its financing arrangements with Greensill Capital UK Ltd,” the Serious Fraud Office said in a statement.

“As this is a live investigation, the SFO can provide no further comment”.

The investigation by the agency that probes white collar crime comes on the heels of Mr Gupta attempting to stabilise his global empire through a series of funding deals following the collapse earlier this year of Greensill. GFG Alliance’s steel business had been heavily dependent on financing from Greensill which specialised in lending funds against future receivables.

A London-based GFG Alliance spokesman told Dow Jones Newswires the company would co-operate fully with the investigation but declined to comment further.

The SFO is looking at several years of transactions involving GFG and Greensill, including deals that involved funding provided by Swiss asset manager GAM Holding, Dow Jones reported citing an unnamed source who was familiar with the investigation.

The UK-based conglomerate, is under pressure to refinance $US5bn ($6.5bn) in debt globally to the failed supply chain financing company Greensill. Earlier this month it struck a deal with White Oak Global Advisors for the $430m owed by Liberty Primary Metals Australia which in turn owns the Whyalla steelmill.

Failed Australian financier Lex Greensill this week told Britain’s parliament that he is not a fraudster and said he bore “complete responsibility” for the collapse of his finance group Greensill Capital.

During questioning by the Treasury committee in Westminster, Mr Greensill denied that his business Greensill Capital, which provided billions of US dollars of finance to hundreds of companies around the world, including against non-existent future receivables, “was nothing more than a trick’’.

The UK’s financial regulator, the Financial Conduct Authority, has previously said it is investigating Greensill Capital, citing allegations of what it called potentially criminal matters. Greensill’s bank was taken over by authorities in Germany.

Mr Gupta made his name in Australia rescuing Whyalla as part of a rapid fire $20bn global acquisition spree, buying struggling steel and aluminium assets from industrial giants including Eiro Tinto, Tata and ArcelorMittal.

Mr Gupta’s GFG employs about 35,000 people globally and more than 2000 people in Australia.

The company bought the Whyalla assets, formerly owned by listed company Arrium, out of administration in 2017 and Mr Gupta soon set about announcing ambitious investment plans for the steel mill as well as sweeping renewable energy plans, much which is now shelved.

-with agencies