Politics gets nasty - Serious turbulence is bubbling just below the calm surface of SA politics as Deputy President Jacob Zuma fights for his political life. Zuma faces grim accusations by the Scorpions related to the arms deal. They have resurfaced. At the top of the ANC, contenders for his job are beginning to show some profile. Meanwhile, a torrent of rumour has swept over Scorpions' chief Bulelani Ngcuka, who is responsible for investigating Zuma. Will Ngcuka close the Zuma case before he leaves office? Can Zuma keep the wolves at bay? See our reporting and analysis on pages 4 and 9.

Reserve Bank records that reflect a R500 000 deposit in late 1999 from a French armaments group to a local group have emerged as a key issue in the Scorpions' investigation into corruption associated with SA's R50bn arms deal.

The amount is the same as that alleged in court documents to have been requested on behalf of Deputy President Jacob Zuma for "political protection" associated with the arms deal.

Zuma has strenuously denied any wrongdoing.

Schabir Shaik, CEO and part owner of recipient company Nkobi Holdings, also denied wrongdoing and has said the amount was associated with share transactions and that it predated the alleged request for a bribe.

The issue reflects some of the difficulties the Scorpions are having in closing lacunas in building a comprehensive case against either Shaik or Zuma. It suggests why the prosecuting unit is pressing its demand to question Shaik in terms of section 28 of the National Prosecutions Authority Act.

Shaik has refused to participate in the inquiry on the basis that he either is or may become a suspect in the case, and that the request contradicts his right not to incriminate himself.

However, the discovery that there is an independent record from the Bank of a R500 000 payment by Thales to Nkobi Holdings at around the time of the request for "political protection" could heighten suspicion that bribery, or at least an attempt at soliciting bribes, took place.

According to Richard Young, MD of arms company C²I², who claims that his firm was sidelined during the procurement process, the Bank transaction constitutes a "smoking gun" unless an absolutely cogent explanation, backed up by relevant and genuine documentation, can be provided by both the Thales and Shaik. "This is especially so in the light of the fact that a warrant of arrest for (Thales local representative) Alain Thetard has been issued by the Directorate of Special Operations," he said.

An affidavit by Scorpions investigator William Downer in 2001 states that in early 2000, a meeting between Thetard, Shaik and a "Mr X" thought to be Zuma was held on March 11 2000 in a room of the Marine Parade Holiday Inn in Durban. Zuma has said he does not recall such a meeting.

The affidavit says that Thetard wrote a letter in French which was faxed in encrypted form to Yann de Jomaron, a director to Thales African in Mauritius and Jean-Paul Perrier, a director of Thales International. "Mr X requested R500000 per annum for continued protection against the pending investigation in respect of the arms deals."

The money was also for "continued support and lobbying" and it was to be paid until Shaik's company, African Defence Systems, started paying dividends. Zuma did in fact write to then chairman of the Standing Committee on Public Accounts, Gavin Woods, in early 2001 defending government's position on the arms deal.

Shaik, however, has a different explanation involving a complex share transaction. He says there is a flaw in the Scorpions argument, since if there was a bribe, it "ought to flow from Thales to myself and from myself to Zuma".

"But that hasn't occurred. T hey have subpoenaed Zuma's bank accounts, and they have seen that the flow does not occur," he said.

With acknowledgements to Paul Kirk, Tim Cohen and the Business Day.