(Corrects story to show regulator referred former KPMG employee not KPMG to a disciplinary hearing, also clarifies that former employee not KPMG could face a range of sanctions)
CAPE TOWN, Feb 27 (Reuters) - South Africa's Independent Regulatory Board for Auditors (IRBA) has referred a former KPMG employee to a disciplinary hearing following an investigation of work carried out for Linkway Trading, a project management firm owned by friends of former President Jacob Zuma.
Linkway Trading was a project management company in the Gupta-owned Oakbay Group. The Gupta brothers have been accused of using their links with Zuma to get lucrative tenders and influence cabinet appointment.
The Guptas and Zuma have denied any wrongdoing.
KPMG has previously refuted allegations that it was involved in, or condoned, any alleged money laundering activities linked to Linkway Trading.
"The disciplinary advisory committee resolved that the registered auditor must be referred to a disciplinary hearing," said Bernard Agulhas, IRBA's chief executive, in response to questions from Reuters.
He said hearing preparations were underway and that possible dates would be set down in due course.
Agulhas said in terms of South Africa's Auditing Professions Act, the former employee could face sanctions ranging from a light caution or reprimand to the severest punishment, being struck from the register of auditors.
KPMG is one of several high-profile international companies facing questions about its work for the Indian-born Gupta brothers.
A number of companies, including the African arm of German insurer Munich Re and local ones such as Sasfin and Hulisani, said last year they would drop KPMG as their auditor. (Reporting by Wendell Roelf; Editing by James Macharia)