Publication: Sunday Independent Issued: Date: 2013-05-19 Reporter: Loyiso Sidimba Reporter: Candice Bailey

Arms deal inquiry awaits proof

 

Publication 

Sunday Independent
Date 2013-05-19
Reporter Loyiso Sidimba, Candice Bailey
Web Link www.iol.co.za



File photo: Chief African Union mediator Thabo Mbeki



Investigators at the Arms Commission of Inquiry, probing the controversial R70 billion arms deal, are awaiting crucial evidence from German law enforcement agencies that could shed light on bribes that several high profile ANC politicians allegedly received.

Separately, the probe will also investigate allegations that former president Thabo Mbeki received a 40 million Deutsche Mark payment into his personal bank account *1 after confidential meetings with British arms manufacturer, BAE Systems.

Mbeki’s spokesman Mukoni Ratshitanga said rather than speculate on the scope of the investigation, they would wait for the commission to specify what it could be focusing on in its probe. Ratshitanga said he was not aware of the commission contacting Mbeki to discuss his relationship with BAE Systems.

Anne Katharina Zimmermann, spokeswoman for Germany’s Federal Justice Minister Sabine Leutheusser-Schnarrenberger, could not establish the status of the request for information from the South African government.

But The Sunday Independent has been reliably informed that the commission began negotiations to obtain the evidence from German authorities in July last year. Negotiations have been under way since.

Commission spokesman William Baloyi said he could not respond to media queries within the time frame.

The information relates to a German investigation into arms manufacturer Thyssen Rheinstahl Technik GMBH and several other companies that formed the German Frigate Consortium in 1994, which won the tender to build and deliver four corvettes for the South African navy at a cost of R1.4bn *2.

Thyssen Rheinstahl is alleged to have concluded a commission agreement with Mallar Inc, a company registered in Liberia and owned by Greek tycoon Anthony Georgiadis, where it allegedly paid his company $22 million to be given to South African officials and members of cabinet.

The consortium then allegedly made fraudulent VAT claims on the bribe payment.

ANC Chief Whip Tony Yengeni, who was convicted of fraud in 2003, is allegedly central to the deal*3 as Georgiadis allegedly booked a flight for Yengeni in 1996 so that Yengeni could participate in meetings with him and members of the German Frigate Consortium.

The Sunday Independent was unable to get hold of Georgiadis at the time of going to print.

But in 1997 German authorities investigated the nine key figures within the consortium for contravening the International Corruption Act and attempted tax evasion.

Rals Hellensbruck, spokesman for the Dusseldorf Office of Public Prosecution, said this week the matter was finalised in 2007. At least two of the individuals were given six-month sentences for tax fraud, he said.

A spokesperson for Thyssen-Krupp Marine Systems said its respect for the processes of the Seriti Commission of Inquiry made it clear that “we are unable to comment on allegations raised by anonymous sources *3 via the media *4”.

Aside from the German deal, the commission has also outlined several deals that underpinned the British contract.

BAE Systems also allegedly took former Numsa official Moses Mayekiso to the UK and Sweden and made a R40m donation to the union’s education fund, requiring R2.8m. It is alleged that Mayekiso pocketed the rest.

But Mayekiso, now a Cope MPL, distanced himself from the claims, saying he was available to testify before the commission *5.

“Not even a single cent went into the school, it never materialised,” said Mayekiso, adding that he was surprised the commission was not consulting him.

Other alleged payments made by BAE, which will be probed include:

- A donation to Orange Farm MK Veterans.

- A bursary to the daughter of a former prominent ANC minister*6.

- A donation of R500 000 to the Airborne Trust, of which late defence minister Joe Modise was a patron.

Modise was allegedly paid $10m to initiate the submarine contract and Dilisa Mji, who was on the Airborne Trust and Modise’s physician and served on the BAE Systems SA board, was allegedly promised R250 000 if the BAE bid was successful.

BAE Systems head of media Leonie Foster said the company was invited to make a submission to the Seriti Commission of Inquiry but had already made one voluntarily.

On whether BAE Systems paid any bribes, Foster said BAE Systems announced in February 2010 the agreement of a global settlement with the UK’s Serious Fraud Office and the Justice Department following long investigations by those authorities relating to a number of countries including South Africa.

“Neither settlement involved charges of bribery or corruption relating to South Africa*7 or any other country,” Foster said.

Aside from allegations of corruption, the commission will also look at acquisition policies and processes in the Department of Defence and Armscor. - Sunday Independent

candice.bailey@inl.co.za

loyiso.sidimba@inl.co.za

With acknowledgement to Loyiso Sidimba, Candice Bailey and Sunday Independent.


*1       I think Mendi Msimang and Sven Moeller may have something to do with that.


*2      Four corvettes for the South African navy at a cost of R6,873 bn in 1999 Rands - more like R15 bn in 2013 Rands.

(5% inflation per year and RoE from R6,25 = USD1,00 in 1999 to R9,50 in 20130.).


*3      ANC Chief Whip Tony Yengeni is certainly central to the deal, although not as chief whip, but as chairman of of the parliamentary defence committee.

He personally caused the frigate deal with Bazan of Spain to be cancelled in May 1995 and the deal to be swung by a great deal of manipulation involving Thabo Mbeki and Chippy Shaik to the Germans in 1998.

For their central roles they received the following from Thyssen :


This is not all. The ANC Women's League received around R60 million. This chaired by the president at the time's wife, Winnie Mandela.

The National Party received some too.

The National Party Women's League was chaired by the deputy president at the time's wife, Marike de Klerk.

One wonder's why she died.

A couple of admirals received some too.

Or was that indeed a couple?

Was it three?

Or was it four?

Or were two of the admirals a couple?

English is a great language.

It's just a pity that it is spoken by BAE and the SFO.


*3      Damn these anonymous sources.


*4      Damn the media.


*5      Stand up young man. Our cross-examiners are ready, willing and waiting.


*6      We now know that is - see Sunday Times of 2013-05-26 - it's a big one as it implication BAE, a cabinet minister, a member of MINCOM and well over the R500 000 threshold for 15 years of chookie time and an entry on the government's supplier blacklist.

Of course it is straight proven bribery and that might allow Terry Crawford-Brown to get the Hawks and the Gripens to be sent back to Britain and Sweden.

Or at least get a 5% clawback from BAE Systems and Saab.

I wonder if I might qualify for a small commission of the 5%?

Let's say I get 10%, so that's 0,5%.

The Hawks and Gripens cost R15,916 billion in 1999 Rands.

So 0,5% of that is R79,580 million.

With the time value of money that is R160 million.

Not as good as Fana's time adjusted R300 million and not go to jail free letter from Menzi Simelane, but surely better than a sharp stick in the eye.


*7      So those settlements do not stand in the way of investigation and indictment for bribery and corruption.

Let's go, let's go, let's go, let's go
down to Zuma's farm
where we want to get these low lives
then live a high life
oh, lets go
take me down to Zuma's farm

Or is that Thabo's farm?