Pretoria - A case before the Pretoria High Court, dealing with details on how Defence Intelligence (DI - previously Military Intelligence) used front companies to spy on current members of cabinet, prominent persons, diplomats, journalists and defence force officers, is expected to send shockwaves through the intelligence community.

The company and the South African government are being sued by former employees after they were allegedly unfairly dismissed during the transformation process.

The case has for the first time revealed the existence of the company, which still exits and operates.

The case was instituted after the counter-intelligence division of the DI front company, which operates from premises in Centurion, was apparently smoothly transferred from the old to the new dispensation to carry on with its national espionage activities.

The defence force financed the company. Additional members were recruited after the 1994 election and integration of the defence forces.

The company's responsibilities included surveillance of and listening in on the exchange of confidential information.

To facilitate these tasks, the latest technology was purchased with defence force funds. Some employees allege that certain operations were performed without the necessary clearance and for the personal gain of some senior officers.

Telephone calls were monitored, for instance, without a judge giving the necessary permission. Intimate details of some individuals? activities were also captured on video. A number of generals allegedly kept these tapes.

Employees had to resign from the defence force to work for the company as part of the ruse. They signed a separate contract with DI.

The stipulations of these contracts will come under the spotlight in court, said Paul Havinga, the group's legal representative.

Some of the employees claim they were entitled to 18 months' salaries when their services were terminated two years ago, and that they had no choice but to turn to the courts.

With acknowledgements to Erika Gibson and the Beeld.