South African Arms Deal

In a January 2001 report, the Attorney-General of the Western Cape and the SIU's own senior legal advisor recommended further investigation:

[T]here are sufficient grounds in terms of the Special Investigating Units and Special Tribunals Act No 74 of 1996, for a special investigating unit to conduct an investigation, and, in our opinion, such an investigation is warranted.

— Frank Kahn and Jan Lubbe, "Report (A) from the Director Public Prosecutions Western Cape, Advocate FW Kahn SC, and Advocate J Lubbe SC, to the Minister of Justice and Constitutional Development, PM Maduna", January 18, 2001.[5]

A joint investigative team looked at the arms deal in 2000. This team consisted of the auditor general, the public defender and the national director of public prosecution. Their published November 2001 report stated that there were no grounds to believe that the government had acted "illegally or improperly".[6]

But, in October 2009, documents provided by Cape Town businessman Richard Young, whose company, CCII Systems, lost the tender for the navy's new corvettes, showed their initial report had been doctored, factual bases had been removed and its conclusions changed.[6]

British and German investigators suspect that bribes of over one billion rand were paid to facilitate the deal.[7] Jacob Zuma, Thabo Mbeki, Schabir Shaik and his brother Chippy Shaik, Fana Hlongwane have been mentioned.[7][8] In March 2003, Tony Yengeni was convicted of defrauding parliament by accepting a bribe while handling the deal.[9] He was sentenced to four years in prison.[9] Andrew Feinstein, an ANC Member of Parliament and the former African National Congress leader of Parliament's public accounts watchdog Scopa, resigned when the party moved to curtail investigations into the arms deal. He wrote a book called After the Party with an insider's view of the process.

Whistleblower Patricia de Lille alleged in Parliament that she had evidence of three payments by warship supplier Thyssen-Krupp on 29 January 1999, each of R500,000, to the ANC, to the Nelson Mandela Children's Fund and to the Community Development Foundation, a Mozambique charity associated with Mandela's wife, Graça Machel.[3]

In his book Feinstein alleges:

• That a report submitted by Scorpions investigators recommended that arms deal corruption involving the ANC itself should be investigated. This was driven by a number of factors, Feinstein writes, including "trips that the party's treasurer general, Mendi Msimang, made to Switzerland to meet the successful bidders";[11]
• That Italian submarine bidders Fincantieri were told they had won the contract, but were informed later that they had been dropped in favour of the Germans. They were offered the chance to "better the Germans" via a payment of $15-million in bribes.[12]

Feinstein points out that this is the same sum under investigation by the German authorities, in relation to an amount allegedly solicited by South Africa's former chief of acquisitions, Chippy Shaik. Shaik has denied the allegation. Feinstein also contradicts public claims by senior government figures that there was no attempt to interfere with the probe into the arms deal once Parliament had authorised a joint investigation team (JIT). He writes: "I was told by someone from the JIT about a meeting with the president at which they… were told who they could and could not investigate."

Elsewhere he claims: "It was made clear to investigators that a shadowy financier close to Mbeki and Zuma who has played an ongoing role in financing the ANC, was off limits." He notes: "For instance, the charge sheet for the arrest of Schabir Shaik was drawn up to charge both Shaik and Zuma. When presented to Bulelani Ngcuka, he is alleged to have responded: 'I will charge the deputy president only if my president agrees.'"[13]

Recounting how he was hauled before the party's top brass after Parliament had authorised its own investigation, Feinstein writes: "I was given a brief opportunity to try to explain the prima facie evidence we had and the process we were following. Within a few minutes Minister in the Presidency Essop Pahad had launched into a ferocious diatribe, spluttering 'Who the fuck do you think you are, questioning the integrity of the government, the ministers and the president?' Pointing aggressively at me, he shouted that we should simply withdraw the resolution."[14]

• DEFENCE ACQUISITIONS – UNPACKING THE PACKAGE DEALS Jakkie Cilliers, Institute for Security Studies – Occasional Paper No 29 – March 1998
• The Arms Deal Virtual Press Office
• Thales's acquisition plan does little for its stock
• Arms deal: 'Ministers got millions' M & G
• Mbeki killed BAE bribery inquiry M & G
• ANC's arms committee condemned IOL
• How arms-deal 'bribes' were paid M & G