The arms deal scandal will not disappear despite the best efforts of government and the witch hunting Joint Investigating Team (JIT).

Revelations that the President`s brother, Moeletsi Mbeki, and former ANC KZN Treasurer and disgraced IDC Chairman Diliza Mji have acquired a 25% stake via Dynamic Global Defence Technologies (DGDT) in Vickers OMC add fuel to the fire of conflicts of interest. This ironically on the day of the release of the Second King Report on Corporate Governance.

In September 2001 Mr. Mji breached the fundamental tenets of sound corporate governance when he used a R22,5-m IDC loan to fund his own business interests in the defence industry - funds that are suspected of having been used for the current DGDT purchase in particular. Mr Mbeki and Mr. Mji`s venture stands to benefit handsomely from the Corvette gearbox deal where the other arms kingmaker Mr. Chippy Shaik played an instrumental role in dropping Maag for Vickers OMC-linked Renk.

Mr. Shaik tasked a senior ARMSCOR official to write to the German Frigate Consortium to inform it of the importance of the Reumech Gear Ratio to ARMSCOR and the department of Defence. Mr. Mji`s unresolved conflict of interest questions relating to Conlog Holdings and to those linked to defence parastatals (ARMSCOR and Denel) at the time of the procurement requires clear resolution.

With the President`s brother now personally benefiting from the controversial Strategic Defence Procurement, courtesy of Mr. Shaik`s intervention, questions about Mr. Shaik resurface - did Mr. Shaik act as an agent for the well-connected in the arms deal? If so, whose agent was he? Why is Mr. Shaik being extensively protected and why has no evidence been found against him?

Mr. Mji has further potential conflict of interest and ethical explaining to do. Mr. Mji left ARMSCOR`s employment to join ATE (Advance Technology and Engineering) as its Chairman and British Aerospace as its SA Deputy Chairman. In 1996 - while Mr. Mji was still with ARMSCOR - BAE bought a 20% stake in ATE. Furthermore ATE is currently contracted by BAE Systems - as part of its industrial participation obligations in the defence deal - as prime avionics contractor for the 24 Hawk fighter-trainers. The Hawk decision is one of the controversial aspects of the deal - Cabinet itself bent the formal procurement rules on `strategic grounds`.

The DA is deeply concerned at the flagrant use of taxpayers` money (via the R22,5m IDC loan) to fund personal gain for those well-connected to the ruling elite in a conflict of interest riddled procurement that will further bleed the taxpayers of South Africa dry. This raises fundamental questions about the `strategic grounds` for Cabinet`s expensive Hawk decision. The impression that the Cabinet subcommittee chaired by then Deputy-President Mbeki was willing to bend procurement rules to benefit the ruling party`s patronage clique is inescapable. As is to be expected the JIT Report merely glosses over these `strategic` decisions by Cabinet without as much as a whisper of concern.

With acknowledgements to Raenette Taljaard and the DA.