Court action may confirm reports that deputy president is being scrutinised

A Durban High Court battle is looming between Deputy President Jacob Zuma's financial adviser, Schabir Shaik, and the Scorpions over whether Shaik can be called to answer questions on arms deal corruption allegations involving Zuma and others.

The court action puts to rest doubts about whether the Scorpions are investigating allegations against Zuma, and seems also to demonstrate that the arms deal report tabled in Parliament did not fully reflect all the outstanding matters awaiting investigation. This has led some to question the credibility of the report and ask whether certain matters were covered up.

An unsuccessful bidder for an information management system contract, Richard Young, who is suing government for R150m for damages, said yesterday the credibility of the arms report was "in tatters".

Zuma is alleged to have attempted to secure a bribe of R500 000 a year from French defence giant Thomson-CSF (which became incorporated into Thales) in return for his protection of the company during the arms probe and his support for future projects.

Zuma's office has denied the allegations as baseless and mischievous, while Scorpions spokesman Sipho Ngwema has declined to confirm a probe into any single person.

The Durban court case is about Shaik's refusal to submit to questioning by the Scorpions on a number of corruption allegations. It has been learnt reliably that court papers have been filed by the Scorpions and that the court date will be finalised once Shaik has lodged his replying affidavits.

In separate court actions, Shaik is being charged with the illegal possession of confidential cabinet documents found during a raid on his home, while he is legally challenging the legality of the search and seizure.

Shaik's attorney, Sivandandha Parsee, said yesterday that the basis for Shaik's refusal to answer questions was that having been charged in one matter he had the right to remain silent with respect to other, intimately related matters.

Parsee said talks were taking place with the Scorpions as to whether the ambit of the questions could be narrowed. "It's not that we do not want to answer the questions but that we believe they are too wide," he said. He said the Scorpions had also indicated that further charges would be laid against Shaik.

The summons was issued by the Scorpions in June, calling on Shaik to present himself at the offices of the directorate of special operations on June 26 for questioning by advocates Gerda Ferreira and William Downer.

An annexe to the summons, dated August this year, said his evidence was required about his knowledge of links, since 1996, between Shaik; the Nkobi group of companies or related entities; the Thomson-CSF/Thales group of companies or any related entities; African Defence Systems (ADS); and Deputy President Jacob Zuma.

Thomson-CSF and its SA subsidiary ADS were part of a consortium that won the R6bn contract to supply four corvettes.

In terms of the summons, Shaik would be questioned about "negotiations, requests, correspondence, meetings or other arrangements concerning the payment of money or the granting of other benefits by any of the persons or entities mentioned above to any of the other persons or entities mentioned above".

"Any documentation in your possession or under your control pertaining to any of the abovementioned aspects must be produced," the summons stated.

Initially Parsee offered to allow a Scorpions officer to go through relevant documents in Shaik's office. This was declined. There was further correspondence requesting clarity on the summons, and then Downer wrote to Parsee on July 31 asking him to indicate whether his client would continue with the high court application in the light of an amended annexe.

The annexe includes questions about meetings held between Shaik, Zuma and representatives of Thomson-CSF in Durban in November 1998 and another on March 11 2000. They also include correspondence between Shaik and Thomson-CSF officials. The amended annexe said the Scorpions wanted to inquire about:

The circumstances surrounding The transaction on September 30 1999 in which Nkobi Investments sold 10 ordinary Thomson-CSF Holding (SA) (Pty) Ltd shares to Thomson-CSF International France for R500 000;
The transaction on September 29 1999 in which 22412 Thomson-CSF Holdings (SA) (Pty) Ltd shares at par value of R1 000 a share were allotted to Thomson-CSF International France; and
The transaction in which Nkobi entered into a service-provider agreement with Thales in Mauritius and in which Nkobi's annual fee charged to Thales was R500 000 and the payment of the fees.

With acknowledgement to Linda Ensor and Business Day.