Cape Town - A close friend and former financial adviser of deputy president Jacob Zuma was found guilty on Thursday of fraud and corruption after a politically charged trial.

Although Zuma was never summoned as a witness and did not face any charges in this trial, the national prosecuting authority had indicated it may consider opening a corruption probe against him on the basis of the trial outcome.

In any event, Zuma is likely to come under pressure to relinquish his claim as heir apparent to President Thabo Mbeki, who stands down in 2009. Zuma was on government business in Zambia on Thursday and had no immediate comment.

Judge Hilary Squires, making his pronouncement in an unprecedented live, national TV broadcast, found Schabir Shaik guilty of two counts of corruption and one count of fraud. Squires will sentence Shaik at a later date.

In reading his 165-page verdict, Squires said there was "overwhelming" evidence of a corrupt relationship between Shaik and Zuma.

Shaik, a former ruling party ANC banker during the apartheid era, was accused of paying Zuma R1.2m in bribes from one of his companies, Nkobi Holdings, without the knowledge of shareholders.

He was also accused of facilitating a R500 000 a year payment to Zuma from French arms trading company Thint Holdings to deflect corruption investigations related to the country's R52.7bn deal to buy ships, submarines, helicopters, jets and other arms from European and South African firms.

Squires, who began reading his verdict on Tuesday, devoted Thursday morning to the allegations about the arms deal bribery allegations, going into exhaustive detail about meetings, correspondence and financial transactions between Shaik and his intermediaries and representatives of Thomsons in 2001 and 2002. He dismissed as "hollow" claims by Shaik that money paid by Thomsons was for an educational trust fund for deprived children set up by Zuma.

"The evidence ... clearly shows a readiness in both Shaik to turn to Zuma for help and Zuma's readiness to give it," said Squires, who was summoned back from retirement to deal with the politically explosive case.

Shaik was a key conduit of funds from abroad for the ANC when it was a banned movement, and his friendship with Zuma dates back to the days of the anti-apartheid struggle. He maintained the money was intended to help Zuma and his extended family meet their high housing, education, transport and clothing expenses after they returned from political exile to South Africa in the early 1990s.

On the fraud allegation, prosecutors argued that Shaik asked for money paid to himself and Zuma to be written off by his company, Nkobi Holdings. Shaik admitted this but said that the blame here lay with his accounting staff - claims Squires disputed.

With acknowledgements to Tisha Steyn and News24.