The arms deal corruption issue

[Dave A]

Our first clue that there might have been corruption/bribes involved with the arms deal was when Patricia de Lille dropped the bombshell in 1999.

It's now 2008 and the case against Zuma has just bing hit with what is effectively a reset button. If it is to continue, the decision to press charges needs to start all over again.

But I'm wondering if the will to keep going still exists within the NPA.

Is this whole arms deal corruption issue going to end up being just swept under the carpet?

[Dave A]

If South Africa were a football club it would be heading for relegation, as the country continues its plunge down the corruption league table compiled by Transparency International.

Transparency International (TI) is an international anti-corruption organisation that produces an annual index of perceived levels of public sector corruption. Countries are scored on a scale from zero (highly corrupt) to 10 (no corruption).

Long-standing log leaders Denmark, New Zealand and Sweden continue to share the top spot this year, all scoring 9,3. Somalia retains the bottom ranking at 1,0.

This year South Africa scored just 4,9, compared with 5,8 for Botswana and 5,5 for Mauritius. In 1996 South Africa scored a respectable 5,7, but this had dropped to 5,0 by 2000. Nigeria has climbed from a dismal score of 0,7 in 1996 to 2,7 this year.

Patrick Berg, TI's programme coordinator for Southern Africa, says the index is based on a survey that asks people how far they think they can conduct their personal and professional lives without falling victim to corruption. Most respondents are drawn from the ranks of business leaders and local representatives of international organisations.

South Africa's score reflects perceptions that corruption is not properly investigated and that those investigations that do take place may be politically motivated, says Berg.
full story from M&G here

The survey was conducted before the ousting of Thabo Mbeki. But thinking about it - the desire to shut down the Scorpions was already sending out clear signals.

[Dave A]

The Scorpions may be doomed, but they're still doing their job.

Striking back amid its death throes, the Scorpions unit launched massive, coordinated raids on Wednesday in what appears to be a final bid to lance the festering sore of the arms deal.

The searches, carried out simultaneously at seven locations in three provinces, flowed from the Scorpions’ belated corruption probe of defence multinational BAE Systems -- and the R1-billion in “commissions� the company paid on the deal.

Investigators believe the commissions were partly designed to conceal bribes used to influence key decision-makers, including the late defence minister Joe Modise.
full story from M&G here

It's quite a long story covering a lot of ground, but here is an extract that points to the smoking gun.

In 1999 the South African government signed a R16-billion contract -- present value more than R30-billion -- with BAE and its Swedish partner, Saab, to buy BAE Hawk jet trainers and Saab Gripen fighters, representing half the value of the total arms deal.

Last year the M&G revealed that the SFO had obtained evidence that BAE had paid out roughly R1-billion in commissions on the SA deal.

Now the question at the centre of the Scorpions inquiry -- and the raids -- is why BAE paid huge commissions to two consultancies in particular: Hlongwane Consulting and Kayswell Services.

Hlongwane Consulting was incorporated in 1999 by then outgoing defence minister Joe Modise’s adviser, Fana Hlongwane.

The SFO investigation has revealed that Hlongwane entered a consultancy agreement with BAE in 2002 on an annual retainer of £1-million (R15-million). In 2005 there was an agreement to pay $8-million (R80-million) as a settlement figure to Hlongwane in relation to “work done on the Gripen project�.

If indeed some of the “consultancy� payments masked bribes, this could explain the questionable twists in the bid selection process.

The South African government was somehow persuaded to choose BAE despite the air force’s opinion that the Hawks were overpriced and the Gripen purchase was premature.

Modise personally intervened to change the evaluation criteria for the jet trainers by excluding cost as a factor, placing BAE in pole position to win the contract.

A Cabinet subcommittee, chaired by then deputy president Thabo Mbeki, chose BAE despite the fact that Italy’s Aermacchi trainer, favoured by the air force, was half the price of BAE’s Hawk.

A recommendation that the BAE-Saab jet fighter purchase be deferred, given that South Africa’s Mirage fighters were serviceable until 2012, was also ignored.

[Dave A]

It is going to be interesting to see how our President responds to this one.

Archbishop Desmond Tutu and former president FW de Klerk have written to President Kgalema Motlanthe to request that he establish an independent commission of inquiry into the arms deal.

Motlanthe on Wednesday said he would comment on the request once he had replied to the Nobel Peace Prize laureates.

Presidential spokesperson Thabo Masebe said Motlanthe had not yet had a chance to look at the letter.

"It will finally get to Pretoria and to the president in the next day or so. It would only be fair to comment once he has seen the letter and replied to former president De Klerk and Archbishop Tutu," said Masebe.

The two urged Motlanthe to draft the terms of reference of the commission to allow the "widest possible investigation into impropriety and corruption," reported the Star.

The pair also suggested an investigation into the possibility of cancelling the arms deal and recovering payments already made.
full story from M&G here

[Dave A]

It looks like Schabir Shaik is still shaking change from the tree.

Schabir Shaik has received a R5-million windfall from the state in terms of a "secret" agreement signed late in 2008 between his lawyer and the government.

In what is believed to be an unprecedented move, the National Director of Public Prosecutions (NDPP) has agreed to split the interest on Shaik's ill-gotten gains.

Shaik is serving a 15-year sentence for his corrupt relationship with Jacob Zuma.

The Star has also established that Zuma's ex-financial adviser has not given up his fight to get back the R34-million confiscated from him and his Nkobi group of companies.

It emerged in papers filed with the Durban High Court this week that Shaik has applied to President Kgalema Motlanthe for the "reprieve and remission of the confiscated amounts".
full story from IOL here

[Dave A]

Nothing unusual about the NPA deal with Shabir...

The National Prosecuting Authority's (NPA) R5-million agreement with fraud convict Schabir Shaik was "normal", it said on Thursday.

"The settlement between the NPA and Shaik is a normal one in civil litigation where disputes are often settled between the parties rather than litigated," NPA spokesperson Tlali Tlali said in a statement.

"The [Asset Forfeiture Unit] settles disputes regularly after weighing up its prospects of success in court, the costs involved in the litigation and the extent to which it can devote its limited resources to litigating other matters," he said.

"In this matter, there was a relatively complex legal dispute about whether the AFU could claim interest on the amount of the confiscation order, the applicable interest rate and the date from which interest accrues.

"The AFU considered the fact that issues have not been litigated before, and would therefore have resulted in further litigation, which would have delayed the process for as much as another two years.

"It was agreed to settle the matter on the basis that the disputed interest would be shared between the parties," he said.
full story from M&G here

Quite a cute way to force the State to meet in the middle - come up with an angle without precedent

Maybe I'm being silly here, but surely the mere fact that there is no precedent on this meant that the NPA had to proceed to get a legal ruling and set precedent. It's not just this case on the line. Now that the argument has been raised, the NPA is likely to face this argument again and again and again - especially as they have essentially caved this time round.

[Dave A]

Quite a lengthy article here posing the question who is delaying the Zuma corruption trial?

[Dave A]

After a day of rumour running riot about the possibility that the prosecuting authority would drop the fraud, corruption and racketeering charges against the president of the African National Congress (ANC) Jacob Zuma, the NPA has let it be known that it has been supplied with additional information by Zuma's lawyers which has necessitated further investigation, verification and careful consideration.

"The acting national director of public prosecutions held a further meeting at the NPA head office in Pretoria today with senior management and the team responsible for the prosecution of Mr Jacob Zuma in order to consider representations he [Zuma] has submitted to the NPA," said Tlali
Tlali, the NPA spokesperson.

"The NPA is treating this process with utmost urgency it deserves. We will communicate the outcome of this process of consideration to Mr Zuma's lawyers as soon as a decision is in place."
full story from M&G here

If for some reason the NPA decides not to continue with the prosecution, I foresee quite a debate about public interest if they don't publicly disclose the reasons.

[garthu]

Once again just to much cloak and dagger. If it's for real (and CLEAN!) then why hide it at all. Things seem to have found a way of leaking out recently so we will probably get to hear something anyway - a little unpopularity peeking out for the parties involved maybe?

[wynn]

Maybe he spilled the beans on Mbeki and Lekota???