Publication: Public Protector Issued: Date: 2007-04-20 Reporter: Sapa

Public Protector's Letter On "Chippy" Shaik Allegations

Issued by : Office of the Public Protector

20 April 2007

BC-PR-CHIPPY-SHAIK
PR-CHIPPY-SHAIK

The Public Protector has responded to Mr Trent's request that he investigate bribery allegations against Mr "Chippy" Shaik.

After due consideration of the request, the media report concerned, and the Joint Investigation Report into the Strategic Defence Procurement Packages submitted to Parliament in 2001, the Public Protector Adv Lawrence Mushwana concluded that he could not, at this stage, proceed with an investigation as the "allegation" referred to criminal conduct that German authorities were investigating.

It would only be possible and proper to consider further investigation or recommendations in respect of the administration, propriety and impact of the procurement process concerned once the criminal and, if so, prosecution of the suspects, have been concluded.

"The Public Protector does not have powers to conduct criminal investigations and to institute prosecutions. It is therefore for the NPA to decide whether the allegations made by Der Spiegel warrant any further investigation in South Africa, at this time," Adv Mushwana said.

The response to Mr Trent is a result of a request from the DA on 5 February that the allegations relating to Mr Shaik should be investigated.

The Public Protector, National Prosecuting Authority and Auditor General, whose offices jointly investigated the arms procurement process in 2001, met on 15 March 2006 to confirm the variety of requests for investigation that have been sent separately to the institutions and to assess if there were overlapping matters that could be addressed jointly.

The outcome of the meeting was that "none of the requests required their joint consideration. They agreed that each institution would deal with issues that have been raised based on their own mandates. This means that the three agencies will not reconstitute a joint investigation team as was structured in the 2001 investigation. The agencies will respond directly to the individuals who made enquiries and requests for investigation."

The Public Protector noted that the Joint Report of 2001 found that Mr Shaik had not recused himself properly from meetings that later awarded contracts to his brother Mr Schabir Shaik. Mr "Chippy" Shaik later resigned from the public service after an inquiry found that he acted improperly by disclosing confidential information contained in a draft report of the Auditor General.

For more information, contact Charles Phahlane on 012 366 7006 or 082 856 8188.
 
 
For media releases, speeches and reports visit the Public Protector's website www.publicprotector.org
 

 
Mr E Trent MP
Democratic Alliance
Parliament

Dear Mr Trent

REQUEST FOR AN INVESTIGATION: ALLEGATIONS IN DER SPIEGEL

Your letters of 5 February 2007 and 4 April 2007 refer.

1. We have considered your request for an investigation of allegations that appeared in a German publication, Der Spiegel, relating to a criminal investigation that is being conducted in Germany into allegations of corruption allegedly involving the former Head of Acquisitions of the South African National Defence Force, Mr "Chippy" Shaik.

2. The article that your request was apparently based on was published in English on the website of Der Spiegel on 5 February 2007. It stated, in the main, that:

2.1 German state prosecutors are investigating allegations that a German shipbuilding consortium paid bribes to South African officials to win a major defence contract. The investigation has been ongoing for almost a year;

2.2 Investigators visited the headquarters of Blohm + Voss in Germany with a search warrant; and

2.3 The prosecutors believe that they have found documents backing up suspicions that the German shipbuilders won the South African contract with the help of "kickbacks", which apparently include several internal memos that appear to document how employees of the shipbuilders held unofficial talks with the head procurement officer of the South African Defence Force. "The high ranking bureaucrat allegedly demanded a payment of $ 3 million at those meetings and in 2000 that sum was indeed transferred to a front company in London".

3. As you are aware, the Strategic Defence Procurement Packages were the subject of comprehensive investigations jointly conducted by the Office of the Public Protector, the Office of the Auditor General and the National Prosecuting Authority, at the request of the Parliamentary Standing Committee on Public Accounts.

4. It was agreed by the three investigating agencies that the Office of the Public Protector would conduct a public hearing into the strategic requirements of the SANDF, the process and procedure of acquisition and specific complaints by a tenderer who alleged certain improprieties in the acquisition process that caused his company to be deselected from obtaining a specific contract.

With acknowledgements to the Office of the Public Protector.