Deputy president's financial adviser to explain stolen arms deal documents found in penthouse.

Former MK operative Schabir Shaik (to the left) - who smuggled millions into the country for the armed struggle - will appear in court tomorrow on a charge of stealing classified government documents.

Shaik, 45, who has since evolved into an international defence systems supplier, is alleged to have stolen documents relating to the government's R43-billion arms deal.

Confidant and financial adviser to Deputy President Jacob Zuma, the Durban millionaire was arrested last November after the Scorpions raided his Durban beachfront penthouse and the business premises of his black empowerment company, Nkobi Holdings, as part of their probe into irregularities in the arms deal.

He was released on R1 000 bail.

Shaik, who is the brother of the government's former chief acquisitions director, Chippy Shaik, is the director of African Defence Systems. ADS is a partner in the South African corvette consortium supplying combat systems to four of the SA Navy's craft as part of the arms deal.

Minutes of a Cabinet committee meeting which mapped out the specifications of helicopters, fighter planes and ships which the government wanted to buy as part of its multibillion-rand defence deal were confiscated in the raid.

Chippy Shaik, who was the secretary at that Cabinet meeting, has since resigned from his defence post.

In spite of the ensuing controversy, Shaik's ADS still secured the deal, worth more than R700-million, to supply combat systems to the SA Navy for four corvettes.

Nkobi Holdings is involved in a host of other government projects, including part of the R2.5-billion rehabilitation of the N3 highway between Johannesburg and Durban.

And the fallout over the arms deal has not affected his most powerful tie to the government, his relationship with the deputy president

Zuma's spokesman, Lakela Kaunda, said: "The allegations against Shaik have not strained their relationship. They have a private relationship which has nothing to do with Zuma being deputy president. Shaik worked under Zuma as his cadre for many years in MK."

Scorpions spokesman Sipho Ngwema said the decision to prosecute Shaik had little to do with sentiment. "The case against Shaik has nothing to do with the struggle," he said. "It has to do with the law being broken. All I can tell you is that we have charged him for a criminal offence."

Ngwema said the court would decide on Monday whether to proceed with the case against Shaik.

Shaik was introduced to the ANC's elite by brothers Mo and Yunus, who both spent years in detention for ANC-aligned political activities.

After lecturing in engineering at Peninsula Technikon in Cape Town in the mid-1980s, Shaik was sent to Russia by Mo and ANC activist Billy Nair to learn how to detonate bombs, and surveillance and counter-surveillance techniques.

It was during a visit to London that he met Zuma who recruited him into the ANC, ultimately placing him in charge of coordinating ANC funds from Europe and Canada into South Africa.

With the unbanning of the ANC, Shaik moved to its Johannesburg headquarters, Shell House, to work under Thomas Titus Nkobi, the ANC's national treasurer-general at the time.

Shaik founded Nkobi Holdings out of a coffee shop in 1995 and is involved in projects to the value of R8.1-billion. Its subsidiaries are involved in various sectors, including automotive asset management, professional services, industrials, privatisation infrastructure, defence, leisure, property developments and telecommunications.

The defence magnate, who drives a Mercedes-Benz SL320, admits to having a passion for cars. "I just hope they gave me the same discount they gave to Tony Yengeni. I'm a player, he's not anymore."

Shaik said he would defend the charges against him when he appeared in the Durban Magistrate's Court tomorrow.

Commenting on the family's fall from grace, Shaik's brother Yunus, a former trade unionist turned lawyer, said: "We feel we're being embarrassed, particularly as aspersions have now been cast on our integrity and commitment to the public ideal of good governance. We have always asserted that we engage in no corrupt activities."

He added that he didn't want his family's struggle credentials to be paraded as badges of honour which should exempt their conduct from close scrutiny.

The Charges

Schabir Shaik was arrested in November after he was found in possession of classified documents, including the minutes of a Cabinet committee meeting which decided on the final order of arms.

Chippy Shaik, his brother, was secretary at that meeting.

The minutes mapped out specifications of helicopters, fighter planes and ships which the government wanted to buy as part of its R43- billion defence deal.

With acknowledgements to Ronnie Govender, Brett Horner and the Sunday Times.