IN THE CONSTITUTIONAL COURT OF SOUTH AFRICA
Case No. : CCT 103/10
In the matter between:
Terry Crawford-Browne Applicant
And
The President of the Republic of South Africa First Respondent
The Government of the Republic of South Africa Second Respondent
AFFIDAVIT
I, the undersigned, Richard Michael Moberly Young, do hereby make oath and say:
Preamble
1. I am an adult male citizen of the Republic of South Africa and of sound mind.
2. I have been made aware of the directions of the above Honourable Court dated 16 May 2011. In the wake of these directions, I was requested by the Applicant to depose to this affidavit, setting forth facts which confirm the averments made by him in the process already filed in this application.
3. While knowledge of many of the facts has come to me in my capacity as the managing director and effective beneficial equity holder of CCII Systems (Pty) Ltd, I depose to this affidavit in my own name and as a concerned citizen of South Africa. I have read the proceedings currently filed before the above Honourable Court. I am prepared to assist the Applicant with this affidavit at this request and to lend my support to him in seeking the relief which he does in Paragraphs (a) to (d) of the notice of motion, as it is my respectful belief that the relief he seeks ought to be granted by the above Honourable Court.
4. The facts stated herein are within my personal knowledge and belief, unless the context indicates the contrary, and are true and correct.
Introduction
5. The averments and allegations made in this affidavit concern the acquisition of armaments for the SANDF as approved by the cabinet in December 1999, this officially being termed the Strategic Defence Packages (SDPs) and more commonly known as the Arms Deal.
6. Although these averments and allegations apply to all of the elements of the SDPS, I have personal and specific knowledge of one component of the SDPs in particular, namely the acquisition of four patrol corvettes for the SA Navy (SAN) due to my company's and my own involvement therewith.
7. However, since my initial involvement I have made it my business to become as familiar and knowledgeable with the other aspects of the Arms Deal, such as circumstances allow. In this regard I have come into contact with many people interested in the Arms Deal, including official South African and official international investigators, media investigators and writers, book authors and whistleblowers.
8. Regarding these whistleblowers, many of them prefer not to come forward publically and because of my already public profile have approached me to hand over information and evidence to the authorities and media on a confidential basis.
9. Indeed I can truly say that I have become a kind of clearing house for all manner of relevant information, both documentary and verbal, regarding the Arms Deal. In the course of doing so, I have come to be in possession of many documents relating to the Arms Deal. Such is the volume of documentation available to me, that I am advised that I should not annex documentation to this affidavit which would go to demonstrate every single factual assertion which is contained in documents. Instead, I have chosen to annex a few documents and chosen those which go to support averments of fact which are most likely to be controversial, or be denied by First and/or Second Respondent. The fact that I do this does not mean that I do not have documents to substantiate what I say, where no documents are attached. To the contrary, I am in possession of a mass of documentary evidence which cannot responsibly be collated and put into an affidavit in support of Applicant's application, without burdening the record intolerably and rendering this case unmanageable. The selection of documentation I have chosen to annex to this affidavit is extremely limited, but goes some distance to show the evidence at my disposal and what I have by way of evidence to present to an independent commission of inquiry, if one is appointed. Should the above Honourable Court seek specific documentation which goes to substantiate a specific averment, I will of course be glad to make it available. It is not, however, practicable to produce every document which goes to substantiate every single averment of fact - to produce all documentation would be burdensome on me and the result would be impossibly burdensome on this Court. I am willing, however, to be of assistance to the Court if called upon to produce documentation.
10. My company CCII Systems (Proprietary) Limited (CCII Systems or C²I² Systems) is a company with limited liability duly incorporated in accordance with the company laws of the Republic of South Africa and having its principal place of business at Unit 3 Rosmead Place, 67 Rosmead Avenue, Kenilworth, Cape Town.
10.1 CCII Systems carries on business as supplier of specialised software, computer and data communication systems for military applications including naval, airborne and mobile systems.
10.2 Save where otherwise indicated, the CCII Systems was, in all the communications and dealings referred to herein, represented by its managing director, Richard Young, that is me.
11. Individuals will, after their first mention, normally be referred to by their surnames.
12. During 1997 process for the acquisition of armaments initiated by the DoD and Armscor on behalf of SANDF under the project names as follows :
12.1 Advanced Light Fighter Aircraft : Project Ukhosi 12.2 Coastal Submarine : Project Wills 12.3 Lead-In Fighter Trainer : Project Winchester 12.4 Light Utility Helicopter : Project Flange 12.5 Maritime Helicopter : Project Maulstic 12.6 Patrol Corvettes : Project Sitron 13. In the said procurement process Armscor acted as the State's statutory procurement agency pursuant to the statutory powers conferred on it under Section 3 of Act 57 of 1968.
14. The body in which the final authority vested to approve the SDPs was the Cabinet.
15. The procurement process approved by Armscor and DoD for the SDPs required that before the SDPs were submitted to Cabinet for final approval it should first be successively considered by a number of lower level bodies.
16. CCII Systems (Pty) Ltd and I personally were involved in certain of the processes for the acquisition of the four corvettes for the SA Navy and in particular the corvette combat suite, as well as for the corvette's Integrated Platform Management System (IPMS), the coastal submarine and its combat suite.
17. Because of my extended interest in the Arms Deal from all perspectives, I have also familiarised myself to a greater degree than most with the entire Arms Deal matter, but in particular with the corvette component.
18. Regarding the corvette acquisition, as matters finally transpired, it was divided into two essentially separate contracts, the platform supplied by the German Frigate Consortium (GFC) (Part A) and the combat suite supplied by Thomson-CSF Naval Combat Systems of France (NCS) and African Defence Systems (Pty) Ltd (ADS) (Parts B and C).
19. The MEKO 200AS from Blohm+Voss, part of the GFC, was chosen for the corvette platform.
20. A set of South African designed systems, plus some systems from Thomson-CSF of France, including its Tavitac Combat Management System (CMS), its Multi-role Radar (MRR), its Hullmount Sonar (HMS)
and the naval Surface-to-Surface Missile (SSM) from its French equity partner Aerospatiale were chosen for the corvette combat suite.
21. The Hawk 120 jet trainer from British Aerospace (later BAE Systems) was chosen for the Lead-In Fighter Trainer (LIFT).
22. The Gripen JAS39 jet fighter from Saab of Sweden, partly owned by British Aerospace, was chosen for the Advanced Light Fighter Aircraft (ALFA).
23. The Type 209 diesel electric submarine from HDW, as part of the German Submarine Consortium, was chosen for the Coastal Submarine.
24. The A109 from Agusta of Italy, was chosen for the Light Utility Helicopter (LUH).
25. The Super Lynx 300 Mk 64from Westland of the United Kingdom, was chosen for the Maritime Helicopter.
Allegations of Corruption : Corvette Platform
26. While certain charges of bribery and corruption regarding directors of ADS and Thomson-CSF South Africa have been proven in court, new allegations have now been formally made by German prosecutors in respect of corruption by the GFC of very high level functionaries in the South African Government, including members of the Cabinet and the Department of Defence's Chief of Acquisitions, Shamim (Chippy) Shaik.
In this regard the German prosecuting authorities formally requested assistance from the South African Government in the form of a letter requesting Mutual Legal Assistance (MLA) dated circa 19 June 2007.
27. I do not have a copy of the MLA request to the South African government. I believe (and I respectfully aver that this belief is an imminently reasonable one) that First and/or Second Respondent would be in possession thereof. If they are not, they can - I aver - unquestionably obtain one. What I do have is a copy of the MLA request to the Swiss government which I am advised is almost identical. (This I attach as Annexure A). As will be seen from this document :
27.1 The German authorities formally allege bribery of some US$22 million paid to a range of high level South African functionaries through a Liberian registered company Mallar Inc, owned by one Tony Georgadis (refer to Page 4 of the MLA).
27.2 The German authorities allege a further US$3 million bribe paid to a British juristic entity Meriam Ltd, a company controlled by one Ian Elvis Pierce on behalf of Chippy Shaik (refer to Page 6 of the MLA).
27.3 The MLA also identifies as suspects nine German officials of Thyssen (refer Page 3 thereof) including Blohm+Voss's CEO at the relevant time, Herbert von Nitzsch, the senior executive involved in the South African Corvette deal, Christoph Hoenings, the corvette programme director Klaus-Joachim Muller and Thyssen's South-African based local representative Sven Muller.
27.4 The MLA attached also identifies the German prosecuting authority's interest in a host of South African organisations, companies and individuals, including :
27.4.1 the ANC;
27.4.2 Nelson Mandela Childrens' Fund;
27.4.3 The Foundation for Community Development;
27.4.4 Armscor;
27.4.5 FBS (a 20% shareholder in ADS);
27.4.6 Thales;
27.4.7 Thint;
27.4.8 Nelson Mandela (then President);
27.4.9 Thabo Mbeki (then Deputy President and chairman of MINCOM);
27.4.10 Joe Modise (first Minister of Defence and member of MINCOM);
27.4.11 Mosiuoa Lekota (second Minister of Defence and member of MINCOM);
27.4.12 Alec Erwin (Minister of Trade and Industry and member of MINCOM);
27.4.13 Trevor Manuel (then Minister of Finance and member of MINCOM);
27.4.14 Ronnie Kasrils (then Deputy Minister of Defence and member of MINCOM);
27.4.15 Mac Maharaj (then Minister of Transport);
27.4.16 Ntsiki Mashimbye (Chairman of Parliamentary Select Committee on Defence);
27.4.17 Thandi Modise Chairwoman of Parliamentary Select Committee on Defence);
27.4.18 Jayendra Naidoo (Chief Negotiator of IONT);
27.4.19 Lionel October (Deputy Director-General in Department of Trade and Industry);
27.4.20 Vanan Pillay (Director and Head of SDPs Industrial Participation in Department of Trade and Industry);
27.4.21 Ron Haywood (Chairman of Armscor);
27.4.22 Llew Swan (CEO of Armscor);
27.4.23 Ken Jones (Marketing Manager of Armscor);
27.4.24 Kevin Hanafey (Armscor Senior Manager Maritime);
27.4.25 Vice Admiral Robert Simpson-Anderson (then Chief of SA Navy);
27.4.26 Vice Admiral Refiloe Mudimu (present Chief of SA Navy);
27.4.27 Rear Admiral Chubby Howell (then Director of Naval Acquisition and later Chief Director Maritime Strategy SA Navy);
27.4.28 Rear Admiral Rusty Higgs (presently Chief Naval Staff, SA Navy);
27.4.29 Rear Admiral (Junior Grade) Jonathan Kamerman (Corvette Project Officer and Naval Project Director SA Navy);
27.4.30 Chippy Shaik (Chief of Acquisitions);
27.4.31 Moe Shaik (brother of Chippy Shaik and Schabir Shaik and at that time Foreign Affairs representative in the South African Consulate in Hamburg, home city of Blohm+Voss);
27.4.32 Schabir Shaik (director of Thint (Pty) Ltd, ADS and Nkobi Holdings);
27.4.33 Ian Pierce (director of Futuristic Business Solutions (Pty) Ltd (FBS));
27.4.34 Yusuf Surtee (confidante of Nelson Mandela and interlocutor for Thabo Mbeki in corvette combat suite deal);
28. The allegations made by the German prosecuting authorities are serious allegations indeed and the Germans allude to having substantial documentary evidence in support of such allegations, specifically regarding the payment to Chippy Shaik. In this regard I believe that they have inter alia the original of a memorandum written in German by one of its most senior executives Christoph Hoenings after his meeting in South Africa in mid-1998 with Shaik where the latter requested the bribe.
29. In late 2009 I was faxed a copy of this memorandum written by Christoph Hoenings from Germany. It is attached as Annexure B1, typed for clarity and attached as Annexure B2, with what I believe to be an accurate, albeit unofficial, translation attached as Annexure B3.
30. This memorandum is clearly an executive statement in terms of South African anti-corruption legislation recording a bribery agreement.
31. I also believe that the German prosecuting authorities have another documentary record written in English where Shaik provides the details of how the payment should be handled, including his authorisation that this be done through Ian Pierce. They are also meant to have a number of other internal memoranda referring to these to two records.
32. In my view there are cogent circumstantial grounds for believing these allegations to be true, at least credible or - at the very least - worthy of investigation by an independent commission of inquiry.. These allegations stem from the background of the corvette acquisition. It is common knowledge (and I was also personally involved at that time as well) that between 1993 and 1995 the SA Navy, together with the DoD and Armscor, essentially and to all intents and purposes completed an acquisition process under Project Sitron for the acquisition of four corvettes. After receiving initial proposals from a range of countries, including Germany, four short-listed companies were requested to provide formal offers. These countries included Denmark, France, Spain and the United Kingdom and did not include Germany. My belief is that Germany was excluded because the price and sophistication of the corvettes that it offered were far too high for the needs or means of the SA Navy. Two companies survived to the final round of bidding, these being Yarrows of the United Kingdom and Bazan of Spain with Bazan being finally selected by the SA Navy, DoD and Armscor. However, when final cabinet approval was sought circa May 1995, Deputy President Mbeki refused to give such final approval to the contract, despite all formal requirements having been fulfilled for doing so during the formal and comprehensive acquisition process.
33. Very soon, indeed within weeks, Mbeki was visiting Germany and advising both German politicians and executives of the German Frigate Consortium (GFC), including the aforementioned Christoph Hoenings, that the corvette acquisition was to be reopened and Germany was welcome to bid.
34. After Project Sitron was reconstituted in 1997 with an essentially identical technical baseline, a similar acquisition process commenced and a shortlist of four countries was drawn up, but this time including Germany and excluding Denmark.
35. Normally military equipment is selected according to the combined criteria of military performance and price. On this basis Bazan again won the bid with its 590B light frigate with the GFC in a fairly distant second place with its MEKO 200AS light frigate.
36. According to adherence requirements of the tendering rules the GFC should in any case have been excluded from the bidding process due to its non-conformances of certain stipulated requirements at certain stages of the bidding process. This was confirmed by Armscor, the statutory acquisition authority, in a legal opinion, a copy of which I am in possession. However, this disqualification was over-ridden by Chippy Shaik in his role as co-chairman of the Strategic Offers Committee (SOFCOM), even though Shaik neither had the authorisation of the committee to do so and in any case that SOFCOM did not have any decision-making authority.
37. After the GFC cleared the hurdle of its non-conformance it still needed to clear the final hurdle of not being the best bidder and in this regard some creative manoeuvring was done by the GFC, its ally the German Submarine Consortium (GSC) and the South African Cabinet. Firstly, the GSC offered nearly 10 times the minimum of 120% of contract price as National Industrial Participation (NIP) in respect of its submarine offer.
This was without providing a contractual guarantee for this extended amount of NIP. The Cabinet then upgraded its deemed value the GFC's NIP offer partly on the basis of the other German offer, i.e. the GSC's NIP offer and at the same time downgraded Bazan's NIP offer (ostensibly on the grounds that the offered projects were not appropriate). It appears that such manipulation of the scoring was on a subjective rather than objective basis and with a view to ensuring that GSC was awarded the tender,. The result of this manipulation was to score the GFC's MEKO 200AS offer higher than Bazan's 590B offer. The supply contract for the corvette platform was - in consequence thereof - awarded to GFC.
38. However, a detailed forensic analysis of the scoring actually shows that there were certain errors in the points allocations, these either being genuine mistakes or done deliberately. On any objective basis Bazan's offer should have won the bid.
39. Under the circumstances it is very clear that the entire award of the corvette contract was very carefully stage-managed by the South African Government in general and Chippy Shaik in particular. There are also clearly two stages in such manipulation, i.e. firstly getting the GFC from No. 5 and not even on the short-list to No. 2 on the short-list and then from No. 2 to No. 1. That this took the German Frigate Consortium two bribes of US$22 million and US$3 million as alleged by the German prosecuting authorities should come as no surprise.
40. Indeed, while the Christoph Hoenings memorandum is very clear, he states explicitly that :
"In this respect it had, according to him (Shaik), been no simple exercise to get us into 1st place."
Allegations of Corruption : Corvette Combat Suite
41. The above allegations are just in respect of the corvette platform and it is in my view both unthinkable and illogical that the Germans would have paid US$25 million to secure their part of the deal as supplier of the corvette platform while their forced bid partner for the combat suite got away with paying nothing for a more-or-less equal share of the spoils.
42. In this regard it should be noted that the GFC's formal offer for the corvettes, including both platform and combat suite, was made on 11 May 1998 in response to Armscor's Request for Offer (RFO) issued circa 13 February 1998. This offer includes Altech Defence Systems as GFC's partner to supply the combat suites. However, such inclusion was not of GFC's own volition, but simply in response to the SA Navy's formal bid requirements documented, in particular in the SA Navy Patrol Corvette Combat Suite Element Costing and Description dated 30 September 1997, as well as Armscor's formal RFO.
43. Now the factual situation at that time was that a group of South African companies had, along with the SA Navy and Armscor, developed more-or-less an entire corvette combat suite under Project Sitron and temporarily under Project SUVECS (while Sitron endured a hiatus while the DoD completed its Defence Review between 1995 and 1997). The heart of this combat system was Altech Defence Systems's Combat Management System (CMS) originally developed for the SA Navy's strike craft under Projects Diamant and Caliban and later refined for purpose under Project Sitron. Altech Defence Systems were, as the country's main naval systems company, also responsible for combat suite integration. As such, Altech Defence Systems and the South African sub-system suppliers were formally nominated in the offer baseline as well as identified in the SA Navy technical specifications to supply the combat suite, specifically in terms of the SA Navy's SA Navy Patrol Corvette Combat Suite Requirements Specification dated circa December 1998.
44. The GFC's May 1998 offer hence included Altech Defence Systems as its combat suite supplier in line with the stipulations of Armscor's February 1998 RFO.
45. At this stage Thomson-CSF was nowhere in the official nor open scheme of things, although it was working all of the unofficial avenues and at the highest levels to get the lion's share of the combat suite business. This was stated later most clearly under oath by Pierre Moynot, ADS's CEO, during the Schabir Shaik trial.
46. Thomson-CSF was also consolidating its position to get this business by purchasing Altech Defence Systems which was then owned by the Altech Group and then giving shareholding in Black-owned companies Nkobi Holdings, owned by Schabir Shaik, brother of Chief of Acquisitions Chippy Shaik and Futuristic Business Solutions owned by Lieutenant General Lambert Moloi, Ian Pierce and Yusuf Mohammed, all friends of Minister of Defence Joe Modise and of Chippy Shaik.
47. I believe that this is where Thomson-CSF comes into the bribery picture and I intend to explain below why there is ample circumstantial evidence to show that Thomson-CSF bribed functionaries in the South African Government to a very similar degree as did the GFC.
48. Firstly, in terms of a simple plausibility test, it is now court-established fact that Thomson-CSF paid a bribe through Schabir Shaik to the deputy president of the country, Jacob Zuma, to protect Thomson-CSF from the massive joint investigation that Parliament initiated into the Arms Deal in October 2000.
49. The document known as the Encrypted Fax written by Thomson-CSF's Alain Thetard which records the bribery agreement and is now accepted by the court as an executive statement, specifically refers to Project Sitron.
50. What has never been ventilated properly anywhere is why Thomson-CSF needed such protection. There is however, some verbal evidence accepted in court that :
"While he was doing that, Mr Shaik said that if the Heath Investigating Unit continues, we're going to be under an amount of pressure and if a certain ANC member - he did mention the name and I can't recall - had to open his mouth, we would be in real trouble." (Page 288 of trial transcript)
51. This evidence was given by Bianca Singh, Schabir Shaik's personal assistant in his corruption trial. The trial judge specifically found her testimony to be credible. While it is unfortunate that the identity of this person is unknown, the most likely inference that can reasonably be drawn is that Thomson-CSF had paid bribes to the ANC and other functionaries in order to secure the lion's share of the corvette combat suite and that a proper investigation would ascertain this.
52. Another item of evidence provided by Bianca Singh in Schabir Shaik's corruption trial was that regarding an interaction between Chippy Shaik, Schabir Shaik and Jacob Zuma. This involved Chippy Shaik during late December 1998 telephoning his brother Schabir to advise him that he was :
"...under pressure and we really need your (Zuma's) help to land this deal (the corvette combat suite deal" (Page 347 of trial transcript)
53. Schabir then used his position with and access to Zuma to telephone him and transmit this message from Chippy Shaik to Zuma.
54. Now what is particularly relevant in this regard (and this is not at all well known or its significance appreciated) is that at this precise time the GFC had - on 22 December 1998 - issued a request for best and final quotation for the command and control segment of the corvette combat suite to Advanced Systems Management (ASM) led by BAeSEMA (a 50/50 joint venture between British Aerospace and the French company SEMA).
BAeSEMA's own combat management system would then be in direct competition with the Tavitac CMS of Thomson-CSF. BAeSEMA had for more than a year been trying to get the SA Navy and Armscor to allow it to compete for the corvette combat suite, but until then it had not been allowed to do so because Altech Defence Systems had developed its own CMS for the SA Navy's strike craft which was also being upgraded for the new corvettes. However, when Thomson-CSF purchased 50% of Altech Defence Systems in May 1998, it immediately made all the moves to replace the South African CMS with its own French one. This appeared to encourage BAeSEMA that it might eventually get a chance to offer its CMS, to a such degree that - at its own risk - it had up to a dozen of its British engineering staff working in Cape Town for several months on its own bid for the combat suite. BAeSEMA had also been vigorously and at the highest level lobbying Blohm+Voss in Hamburg to be given an opportunity to quote. Therefore when it received the formal request for quotation from the GFC it accelerated its quotation preparation efforts including working right through the Christmas and New Year period in order to be able to deliver it quotation by the stipulated date of 15 January 1999.
55. Yet on 14 January 1999, the day before offering its competitive quotation, BAeSEMA's parent company BAe Defence Systems suddenly and without prior notice formally withdrew from the competition, citing "having reviewed the competitive position" as the reason for this withdrawal.
56. This reference to "competitive position" is all important as it actually refers to the impossible position regarding Thomson-CSF. Indeed, some weeks later Roger Barnes, then managing director of British Aerospace Sea Systems (which had superseded BAeSEMA in name after purchasing SEMA's 50% share), personally told me that :
"We considered the South African combat suite as a must-win opportunity"
and :
"Never in my 17 years in this industry have we (British Aerospace) been told so directly and from someone so high up in the home country that we should withdraw our bid (for the SA Navy's Patrol Corvette Combat Suite)."
57. It is clear to me that these interventions were not only unlawful and should have invalidated the entire corvette contract, but they came from the highest levels of politicians.
58. Having obtained various documents directly relevant to the corvette acquisition process during my extensive investigations, there are fairly clear indications of both a very high amount of money being made available within Thomson-CSF's project budget to pay bribes to secure the corvette combat suite business by Thomson-CSF Naval Combat System (NCS) and African Defence Systems (ADS), but also an extraordinary level of political interference in the acquisition process.
59. By this time Chippy Shaik had formally declared his conflict of interest and consequent recusal from the combat suite acquisition process. However, the joint investigation found that such recusal was a sham. Indeed, not only was this so-called recusal a sham, but a range of formal DoD documentary records show that Chippy Shaik was fully involved with the corvette combat suite acquisition process while other records show that the local representatives of Thomson-CSF, i.e. Pierre Moynot and Alain Thetard were having a series of regular secret meetings with Chippy Shaik. Chippy Shaik was also directly engaging with the head of Thomson-CSF NCS, Alex Dorian, as well as ADS CEO Pierre Moynot regarding negotiating the scope and price of the combat suite. This was known at that time to both the corvette DoD project director, RAdm(JG)
Jonny Kamerman and to Armscor corvette programme manager, Frits Nortje. Although they recorded this in an internal programme memorandum, nothing was done by them or their superiors about this clear violation of project acquisition process.
60. By a perusal of a range of project records, such as minutes of the Naval Project Control Board (PCB) meeting minutes, there is clear evidence of pricing manipulations and, in particular, last minute upward pricing changes, which are unexplained and inexplicable unless they indicate that an amount of some R300 million was probably paid in bribes and/or commissions by Thomson-CSF to secure the combat suite contract. This would have been well worth it for Thomson-CSF because it was no way in the running up until the final stages of the acquisition process and it ended up in securing about R1,6 billion worth of contracts. In doing so it not only managed the exclusion of Altech Defence Systems's indigenous CMS by replacing it with its own French Tavitac system, but also replaced two South African sub-systems with its own products and "won" all three of the items that were originally designated to be foreign procured items. This gave Thomson-CSF about R1,3 billion and ADS R0,3 billion worth of contact value.
61. What is especially noteworthy is that, although negotiations for the precise scope of supply and price of the corvette combat suite only commenced in early December 1998, culminating in the supply contract signed on 3 December 1999 , the records show that Thomson-CSF was increasingly confident of securing this workshare right from around September 1997.
62. In the 1997 baseline, the DoD had set a cost ceiling for the combat suite at R1,47 billion. This figure is on record as having been arrived at by the SA Navy and Armscor after a comprehensive price and risk audit during May 1998 of the prices being offered by the South African combat suite system suppliers as well as potential foreign offerers for the foreign equipment and was in 1998 Rands. By the time that scope of supply and price negotiations commenced in January 1999, this R1,47 billion could be justifiably have been escalated to R1,9 billion due to prevailing currency exchange rates and other escalation factors.
63. However, Thomson-CSF, knowing its illicit support base at a high political level, had the DoD and Armscor figuratively over the negotiating barrel and made its first technically conformant offer of R3,9 billion in February 1999. This was clearly unacceptable as there was a cabinet-approved price ceiling of R6,001 billion for the entire corvette including an allocation of R1,47 billion just for the combat suite. Over the next three months or so the SA Navy radically reduced its expectations for the combat suite and by April 1999 a total price of R2,3 billion, including a risk provision and all other amounts for, inter alia, statutory costs, project management, financing and ECA premium. At this stage the Project Control Board had an expectation of price of R2,1 billion for the combat suite and the project officer is on the formal record as saying that the then offered current price was R2,3 billion and that the "Corvette was within goal of the Cabinet approved RM6001". Clearly if this was the case, the R2,3 billion would have to reduce by at least R100 million.
64. Yet inexplicably Chippy Shaik records at the PCB meeting of 27 May 1999 that the SDP Affordability Study indicated a price for the combat suite at R2,6 million. There are absolutely no clear grounds for this, especially when this would take the cabinet-approved ceiling price for the corvette from R6,001 billion to some R6,7 billion. The Affordability Study Report also makes no mention of any combat suite pricing. It is therefore clear that Shaik was using other sources of information and certainly illicit sources in this context.
65. At the same time there are clear documentary indications that Thomson- CSF itself had an expectation of a R2,3 billion final price for the combat suite. Indeed Alain Thetard's facsimile to head office dated 17 May 1999 shows an expected price of "2,3 GF" amended hurriedly by hand to "2,6 GF", precisely in accordance with the pricing reported in the PCB meetings and at the Naval Board meeting. It should be noted that by this time that R1,00 was being taken for negotiation purposes to equal FF1,00;
thus the actual prevailing exchange rate was not a factor. The news of the increase to R2,6 billion came so quickly to Thetard that he had no time to update his computerised records.
66. However, what in my view is particularly noteworthy is that the date of Thetard's facsimile of 17 May 1999 with its hurriedly updated combat suite price is exactly the same date as his encrypted facsimile (refer Annexure C) about Masekela, Kogl and Thomson-CSF's secret business arrangement.
67. In the 16 April 1999 notes made by Pierre Moynot, who was ADS's chief negotiator for the combat suite, he also refers to a combat suite price of "2,7 bn F" as well as to one of "2,350 bn F (except the 35 mm cannons)".
These prices accord almost exactly with Alain Thetard's expectation of price as well as those of the PCB and Kamerman. The reference to the 35 cannons is not overly relevant because even if the R2,350 total price did not include the price of these cannons, actually the Dual Purpose Gun (DPG), the price of the DPG varied during the negotiations between R82 million and R106 million and thus even if it were excluded from the R2,350 price then including the DPG at R100 million would cause the combat suite price to be R2,450 million at this point. This is still a difference of R150 million from R2,600 billion or R250 million from R2,700 billion. The increase from R2,2 billion or R2,300 billion to the final price of R2,599 billion remains inexplicable.
68. Yet the final corvette combat suite price at R2,6 billion was clearly approved during the late April to May 1999 timeframe and it was at this level that the final selections were approved by the PCB on 8 June 1999 and contracted on 3 December 1999. This caused the corvette price to increase from the cabinet-approved R6,001 billion to the final contract price of R6,873 billion. This R872 million is a very substantial difference indeed, especially after the DoD, SA Navy and Armscor had advised all bidders at various levels that there would be no increase in the initial cabinet-approved price ceiling (other than ROE and CPI escalations).
69. Adding impetus to my argument of inexplicability is that the current price and the price reductions were of such grave importance to the PCB and the Naval Board that this subject was not only a matter of length discussion and the recorded minutes, but also invariably the main subject of a specific pre-prepared presentation by the corvette project officer, who was the DoD's chief negotiator with the German and French bidders for the corvette platform and combat suite. That the sudden price increase from late April 1999 to middle May 1999 was not noted in any official records of the PCB nor of the Naval Board, points to a complete breakdown of the formal negotiating process at that stage and at this point there is every reason to believe that some intervention from higher authority was the cause of this. In my view there is a strong circumstantial case to suspect corruption as being this cause.
70. Along with other Thomson-CSF documentation, specifically an internal presentation dated 26 January 1999 (refer Annexure D) which clearly provides for enormous "provisions" and "contingences" in the price of the combat suite, it is almost impossible not to believe that the unexplained price jump at the final hour from R2,3 billion to R2,6 billion did not provide the R300 million to fund the required bribes for Thomson-CSF to secure its substantial slice of the combat suite contract.
71. This Thomson-CSF presentation in French also clearly shows that combat suite prices were being made known and discussed within the Thomson-CSF company as a whole and not just within ADS. In this regard it is noteworthy that the spreadsheet entitled Sitron Prices includes the then price of CCII Systems's IMS, which would eventually be replaced by Thomson-CSF's own product. When confronted that CCII Systems's IMS had been given to its competitors, Pierre Moynot is on record as having contented that the prices of the IMS and Thomson-CSF Detexis Diacerto databus were "only compared internally". That it was disclosed in a presentation in French and probably given in France makes this an incredible contention. ADS was a South African company and if this was an internal ADS presentation then the language used would definitely have been English.
72. The disclosure of CCII Systems's IMS price to Thomson-CSF Detexis is also dealt with by Capt(SAN) H.N. Marais in his interview under oath made with him on 29 June 2001 where he testifies on the subject. There are several typographical errors in the transcript, but I quote them as transcribed. The transcript reads as follows :
"there is a fourth I reason, which is why I was consulting my notes and so on. I suspected unethical business practises being exercised by ADS, by in advance making the prices they have .received from C-squed I-squed available to Thompson Detexis, prior to Thompson Detexis having had to submit their quotation for the BAFO. The reason why I am making that statement, I have overheard a discussion between a person Jean-mark Ferre from Thompson Detexis" (Page 1551)
"Those individuals both employed Thompson Desalt or Thompson Detexis and the conversation took place on 3 June 1999, Cape Town area" (Page 1551 to 1552)
"The also, the conversation that was overheard, I took further and during a tea-break confronted them with the statement that was made by Jean-mark Ferre, that they are offering their Bus System at approximately 30% less expensive than the C-squed I-squed Bus and that was made by that person" (Page 1552)
"That statement could not have been made by Detexis unless they had visibility, advance visibility into the C-squed I-squed Databus proposal" (Page 1552)
73. Very relevantly in my view, the notes written by Pierre Moynot on 16 April 1999 indicate that the then currently negotiated price for the corvette combat suite was FF2,350 billion. At that time the French Franc and SA Rand were almost equal in value (1 ZAR = 0,96 FF). Yet these notes also refer to a price of FF2,7 billion, a difference which is not explicable on the marginal difference in currency. The briefing to the Naval Board on 26 March 1999, also attached to the minutes of the PCB meeting of 24 April 1999 refers to a price of R2,3 billion and that further price reductions were possible. Indeed the minutes of the Naval Board meeting held 30 April 1999 show that a large number of price reduction measures were taken, although severance of the document has removed the details.
Yet the minutes of the PCB meeting of 27 May 1999 indicate the then current price as R2,600 billion. And this is what the final price indeed was (actually R2,599 billion to be precise). I contend that my argument shows that a price of R2,300 billion was actually the negotiated price and that the R2,600 billion price included R300 million for additional disbursements including commissions, specifically unlawful and corrupt commissions.
74. Regarding the intentions of Thomson-CSF and ADS in the negotiations with the State over the corvette combat, it is relevant to note the conduct of the State negotiators. In this regard it is noteworthy to consider the averments of a senior naval officer, Capt (SAN) H.N. Marais who was a senior member of the corvette Joint Project Team and was intimately involved in these negotiations.
75. On the deselection of South African systems and selection of entirely French, indeed Thomson-CSF foreign procured items, Capt Marais avers in an interview under oath made with him on 29 June 2001 as follows :
"Accurate perspective. At that stage, higher authority applied pressures to maximise or increase the French content. It was not specifically the Navigation Distribution System."
"It is mainly because of the actual and perceived pressures applied to maximise the French content in the or to increase the French content of the combat suite."
76. Capt Marais's testimony accords very closely with what I personally heard at this same time and later, i.e. that this was that an instruction had been given by Mbeki to Chippy Shaik to maximise the French content of the corvette combat suite in order to placate the French for not having been awarded any of the contracts for the primary equipment in the other SDPs.
In my view, this is not only plausible, it is entirely credible.
77. On the matter of CCII Systems's pricing for the SMS being given to ADS, Capt Marais avers as follows :
"It is the marketing department of every company's task to find out what your competitors are bidding. In this particular case it was actually given to ADS, because that was the communication channel."
78. I am unaware of there being any reason that Capt Marais would be lying under oath. If, therefore, it is accepted that ADS was indeed given this price, then this constitutes fraud.
79. Supporting the credibility of Marais's statement is the fact that ADS and CCII Systems were required to furnish competitive tenders after ADS two previous quotations were rejected by the corvette project team. The chronology was as follows :
79.1 On or about 15 March 1999 ADS submitted to Armscor an offer of R64,73 million for the SMS.
79.2 The JPT considered ADS's quoted price for the SMS to be too high and ADS was requested to submit a reduced offer.
79.3 On or about 7 April 1999 ADS submitted a reduced offer for the SMS of R37,62 million.
80. The corvette project team then instructed the GFC, to get competitive quotations from both ADS and CCII Systems which had to be submitted at the same time on 15 April 1999. They did so, with CCII Systems's price of R23 192 922 being substantially lower than that of ADS's price of R32 479 000. But ADS was allowed to reduce its price the next day 16 April 1999 down to R29 647 000 (refer Annexure E) on the grounds of having made clerical errors and omissions.
81. Strangely, at least in transparent and normal tendering procedures, even though ADS's second price was still higher than CCII Systems's first quote, ADS were allowed to add on their own margin and handling fees of about 12% to CCII Systems price (but not to its own price) which then made CCII Systems extended price marginally higher than ADS's reduced and unextended price, this allowing ADS to win the contract to supply SMS.
82. Although the evidence of this bribery by Thomson-CSF is in part circumstantial (other than of course its court-proven bribery of Jacob Zuma) this also needs to be viewed in terms of this company's known propensity for bribery and corruption on an international scale.
83. In this regard:
83.1 Commentators have written that when Thomson-CSF's new Chairman Denis Ranque took over this position in 1998 he was so concerned about Thomson-CSF's poor reputation caused by bribery and corruption that he initiated the company's name change to Thales. This was so important that even at the cost of some Euro500 000 this expense was considered to be worth the break from the past, albeit only in name.
83.2 Dozens of allegations of bribery and corruption have been made against Thomson-CSF in many jurisdictions involving its many of its different operating divisions, across the world.
Some of these have been proven.
83.3 The most stark and serious of these bribery allegations regards one of the largest international naval acquisitions ever made outside of the USA.
83.3.1 This is known as the Taiwanese La Fayette programme where the Taiwanese Navy purchased six La Fayette frigates from France for a total contract price of some USD2,8 billion (in then monetary values).
83.3.2 The Taiwanese government soon realised (and formally alleged) that the contract price included some USD500 million in unlawful commissions.
This amounted to around 20% of the contract price which can be considered to be the norm in the circumstances and at that time.
83.3.3 Although the deal was signed in 1991 it has taken the Taiwanese authorities almost exactly 20 years to finally win its case against Thompson-CSF (now Thales).
83.3.4 On 3 May 2010, the ICC arbitration court ruled that Thales had to pay a penalty of USD591 million plus interest, litigation fees and other related expenses for violating Article 18 of the contract, known as "Bravo" in France, which required that there should be no payment of commissions.
83.3.5 Shortly before finalising this affidavit and on 10 June 2011, a French court ruling finally rejected an appeal by Thales against payment of damages to Taiwan (refer Annexure F).
83.3.6 Ironically, it is not Thales which will have to bear the brunt of this penalty, as the French government announced on the same day that it would have to pay Taiwan Euro460 million (USD591 million) after Thales lost its appeal over its wrongful payment of commissions on the warship deal.
83.4 This up to the minute information shows not only that Thales has the propensity to bribe foreign officials to be successful in its bids for lucrative contracts, but also the enormous time that is required to get justice done.
84. Further supporting my contention of Thomson-CSF's business model of securing contracts through bribery and corruption is a copy of an extraordinary document which is actually a printout of an overhead presentation given at a meeting of Thomson-CSF International managers ("delegates") in November 1998. The entire document that I have is 131 pages in length and so as not to burden this affidavit or the honourable court I annex just 39 pages (refer Annexure G) of what I consider to be the most relevant content. The presentation is mainly in French and concerns Thomson-CDSF's response to the then about to formally promulgated Organisation for Economic Co-operation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Previous to this OECD convention, bribing of foreign officials was lawful in foreign countries, especially in Europe, where indeed the costs of such bribery and corruption were even tax deductible for the company paying the bribes. To deal with this Thomson-CSF formulated a set of company sanctioned mechanisms to circumvent the OECD convention. The presentation refers specifically to its South African operations in respect of Thomson-CSF South Africa, ADS, Nkobi Holdings and FBS with Thomson-CSF South Africa and Nkobi Holdings these entities having been formally indicted of corruption in the Schabir Shaik and Jacob Zuma matters. The presentation is literally littered with examples of these circumvention mechanisms including those of "offshore payments" (Page 94), "success fees", "lobbyist fees", "service provider" fees, etc. In its own version, inverted commas are used to indicate the farcical legitimacy of these mechanisms.
85. Taking into account Thabo Mbeki's and Chippy Shaik's illicit involvements with Thomson-CSF (refer to later sections in this affidavit for more detail), as well as almost reciprocal conduct as alleged by the German prosecutors regarding the corvette platform, I believe there are cogent reasons for the South African prosecuting and investigating authorities to be investigating both the roles that these two persons played in the combat suite acquisition process, as well as the possibility of them or related parties, such as the ANC, including the ANC Women's League, receiving bribes. They are not doing so and the appointment of an independent commission of inquiry is, in my respectful view, indicated for this reason alone.
86. It is also important to note that in the very early days of the joint investigation, in particular that by the Directorate of Special Operations (DSO), that there was indeed a joint investigation by the South African and French authorities. From this country it was led by Advocate Gerda Ferreira of the DSO and from France by Magistrate Edith Boisette. Very substantial progress was initially made including raids of the headquarter offices of Thomson-CSF and of the Chairman of Thomson-CSF International Jean-Paul Perrier. These raids yielded vast amounts of documentary evidence, much of which was used in the successful corruption trial of Schabir Shaik and would also have been used in the trial of Jacob Zuma and Thomson-CSF South Africa had that case not been abandoned by the NPA (in my view on the flimsiest of reasons). However, while these investigations were underway and yielding excellent results, there were inventions from the highest of levels of the South African authorities, including visits to France by the Minister of Justice Dr Penuell Maduna and National Director of Public Prosecutions (NDPP) Advocate Bulelani Ngcuka, who had meetings with high level officials and judges in the French Ministry of Justice. So after, the co-operative investigation ended.
Naval Surface-to-Surface Missiles
87. Another specific, interesting and important point regarding the price of the corvette combat suite is the price of the Surface-to-Surface Missiles (SSM). In the 29 July 1999 costing prepared by Thomson-CSF (refer Annexure H), the cost of the SSM acquisition is indicated as 182 257 785 F (approximately R182 million) for the "Ammunition". Yet Kamerman testified during the Public Protector hearings that the cost of each Exocet Block 2 missile round was about R20 million. Simple arithmetic shows that only nine missiles could have been purchased for R182 million.
88. I have been advised that in fact another scheme was used. This entailed purchasing a minimum number of missiles outright, such as nine (two each per corvette plus one test round) and acquiring a further amount such as eight (to make up the total of 17) under a kind of lease scheme where the SA Navy pays a certain amount per year to posses them, as well as pays for each round when these are actually fired. I know that a number of Exocet missiles have been fired since the acquisition of the corvettes.
89. In addition there are references to the SA Navy having and firing both MM40 Block 1 missiles as well as Block 2 missiles. The reference to Block 1 missiles seems to be incongruent with Kamerman's averment that the SA Navy acquired 17 MM40 Block 2 missiles under project Sitron.
Indeed the former Minister of Defence has subsequently confirmed in a written reply to a parliamentary question dated 13 August 2007 (refer Annexure I) that actually 6 MM40 Block 1 and 11 MM40 Block 2 missiles were acquired. Why this is of particular importance is that by reducing the initial SSM programme cost by not including the cost of the missile rounds themselves, the price of the rest of the combat suite could effectively be increased to the advantage of Thomson-CSF.
90. In any case Kamerman testified to the Joint Investigation Team during the Public Protector hearing into the Arms Deal as follows :
"At the end of the day one of the major decisions that the Naval Board made in its quest to lower the cost of the combat suite and thus the affordability of the whole Corvette as a whole, was to reduce the initial batch of missiles from 32 missiles to 17 missiles.
And these are very expensive things. They approach R20 million apiece. So if you reduce by 16 missiles, or 15 missiles, you can imagine that is an awful lot of money."
"we were faced with a situation that neither of the two missiles that we had specified, rather neither of the two missiles that were on the table for evaluation before us"
"In this exercise, by reducing the number to be initially purchased from 32 to 17, we obliged the German Frigate Consortium to go back to the manufacturers, and we had done a technical evaluation of both of them but now we wanted a quote. They had quoted for 32, we wanted them to quote for 17."
"If you went under that minimum level, if you ordered fewer items from them, their price still remained the same. So on a price performance basis, primarily, although there were certain distinct advantages operationally with the French missile and that is a fact of the matter, it was primarily on a price performance basis that the Exocet missile was eventually proposed to the Naval Board, which ratified it, which in turn was proposed to the, or brought to the PCB which in due course ratified it. I want, however, to emphasize that the Exocet MM40 Block 2 is the leading European missile and is supplied to dozens of nations and is in fact the front line anti-ship missile right now for many NATO nations as we speak. It is a superb missile.
"So the missiles that were on the table in front of us, that is the MM40 Block 2 and the RBS15 Mark 3, represented and still represent the front edge of missile technology, anti-ship missile technology.
"The MM40 Block 1 was used in the Gulf War, and the MM40 Block 2 is a completely different missile. It is a brand new state of the art missile. It is the leading edge of missile technology today. As I have said, the Naval Board was not prepared to compromise on our primary weapons."
91. In his Section 28 interview held under oath with the JIT investigators, Kamerman testifies as follows (Page 867) :
"There is actually no real risk for us to take the Aerospatiale MM40 Block 2 missile and put it into a category C...."
92. Through the investigation, Kamerman never makes any reference, nor ever gives any indication, either that less than 17 Bock 2 missiles, nor any Block 1 missiles were acquired under the SDP corvette acquisition programme. The only reason for this, considering the fact that the MoD had formally stated in a written reply to a parliamentary question that it acquired 11 Bock 2 missiles and 6 Block 1 missiles, was that there was something highly irregular in this regard. And Kamerman would have known exactly what and when equipment was purchased because he was both the corvette project officer and the naval projects director at all the relevant times up until 2006.
93. On a slightly different angle at this juncture, but nevertheless quite relevant in my view, is that Kamerman resigned from the SA Navy as its Projects Director in around July 2006 and joined as its Vice President of International Sales of Thyssen Krupp Marine Systems (TKMS) which in effect was an amalgamation of the German Frigate Consortium and German Submarine Consortium. Not only is this a stark example of the practice of the so-called "revolving door", but that this was specifically prohibited in the Corvette Umbrella Agreement with the written approval of the Chief of the SANDF. It is on record that no such approval was given.
Interestingly, the relevant stipulation in the Umbrella Agreement is in a section entitled "Remedies in the Case of Bribes".
94. Regarding the SSM, it appears that the Exocet missiles were ordered circa mid-2000. Indeed an article dated 1 August 2000 in the authoritative Jane's Intelligence Weekly reports as follows :
"The South African Navy (SAN) has placed an order with the European Aerospace and Defence Company (EADS) for the latest generation Exocet anti-ship missile system to equip its four new Meko A200 patrol corvettes."
95. While it is a fact that the SA Navy was acquiring not only not "latest generation" missiles for the corvettes, there are a number of other aspects of this statement that bear scrutiny, inter alia, the date of the reported transaction, that the order was placed with EADS and not Aerospatiale, as well as that the reference is to latest generation missiles. It could well be that there were multiple orders for missiles, possibly some within the corvette acquisition budget out of the Special Defence Account and some as a separate purchase, possibly out of the SA Navy's running budget.
96. In essence Kamerman testified that the SA Navy had acquired 17 state-ofthe- art Exocet MM40 Block 2 missiles whereas in fact only 11 missiles had been acquired along with 6 inferior Exocet MM40 Block 1 missiles. To my mind, this is proof that Kamerman was lying to the Joint Investigation Team, or at least deliberately misleading them as to the true facts of the matter, during the Public Protector hearings into the Arms Deal as well as his Section 28 interview under oath.
97. Even if the 17 Exocet MM40 missiles were acquired under the corvette contract, but that six of these were Block 1 missiles, these 6 are operationally useless to the SA Navy. They may be useful for testing the corvette combat suites as well as for training, but being operationally useless means that the SA Navy has to acquire further missiles for its operational stock as well as for war stock. In my respectful view this substantially fuels my contention that the corvette combat suite contract was fundamentally flawed and conducted to favour ADS, Thomson-CSF and France, who reciprocated in kind.
98. However another aspect that needs to be considered is whether the SSM and its missiles were actually acquired under the SDP corvette contract through ESACC, or differently, i.e. directly through Armscor.
99. Of course, it is also well known and also a matter of public record that the SA Navy has had enormous funding difficulties just to maintain itself as marginally operational during this last decade since it acquired new corvettes and submarines under the Arms Deal. It is likely that funding expendable ammunition out of its annual running budgets, rather than from the Special Defence Account, which is meant to fund capital acquisitions in their totality, is the root cause of its financial problems. This is very important because this would mean that the Arms Deal has in fact detracted from national defence security and left the SA Navy severely debilitated in performing its constitutional duty.
100. While most of the detail of this part of the corvette combat suite transaction has been obfuscated and hidden by the acquisition authorities from detailed scrutiny, there is certainly something not right here and it bears further forensic investigation.
Allegations of Corruption : Coastal Submarines
101. Another component of the SDPs was the acquisition of new coastal submarines for the SAN under Project Wills.
102. The final preferred supplier for the submarines was the German Submarine Consortium (GSC).
103. This surprised many insiders, including me, at that time because the GSC was considered to have a weak bid, especially in respect of Industrial Participation and price. My company was part of the South African Submarine Industrial Cluster (SASUBCLUB) and had access to much relevant information and views at that time. Until very shortly before the preferred suppliers were announced by Cabinet in November 1998, the GSC was considered to be either last or second last in the running. Yet just before, literally a few days, the announcement, the GSC moved into first position.
104. More quantitatively, a careful review of the draft and final JIT Reports indicates that there were substantial anomalies with the way the GSC was selected as the preferred supplier. Specifically there seem to have been problems with the scoring of the NIP, DIP, Financing and Military Value. All the problems were to the advantage of the GSC. In the other contracts Military Value was determined by dividing Military Performance by Cost. On this criteria, Fincantieri would have come out on top. But in the submarine contract a different formula was used and the Integrated Logistic Support component was given a very high weighting, even though it was a relatively small component of the contract price. The GSC was recorded as offering a very low price offer on this component.
This basically swung the Military Value component of the evaluations GSC's way. The JIT Report records that according to the Affordability Report the costs of the GSC's bid presented to Cabinet in November 1998 "did not take into account all the elements of costs."
111. HDW was one of the members of GSC as well as of the GFC.
112. Another member of the GSC was the German company Ferrostaal.
113. Ferrostaal subsequently was acquired by the Thyssen Group and is now part of TKMS.
114. This means that all of Blohm+Voss, Thyssen and Ferrostaal are part of the same TKMS group.
115. I was advised that when the German prosecuting authorities and police investigators raided Blohm+Voss and Thyssen on 19 June 2006 in connection with the corvette allegations, on a tip-off they also raided the premises of MAN-Ferrostaal in Essen, Germany, having been advised that Ferrostaal was storing sensitive documents on behalf of its sister company Thyssen. There, I am advised, the investigators indeed found documentary records relevant to the corvette acquisition, but also found documents indicating bribery in respect of the submarine acquisition.
116. I was told telephonically soon after these raids by someone close to the investigation that "Ferrostaal paid even larger bribes for GSC to win the South African submarine deal than Thyssen paid for the GFC win the South African corvette deal".
117. HDW in turn had selected STN Atlas Elektronik as the supplier of the submarine combat suites.
118. During the negotiation phase of the SDPs Shaik put pressure on certain parties in the SASUBCLUB to meet with ADS with a view to the latter's possible involvement as the submarine combat system supplier and at his specific instigation a meeting of SASUBCLUB and ADS was convened on 30 June 1998 under Shaik's chairmanship.
119. Shaik also had meetings with HDW (represented by Clement Steinkamp) and with STN Atlas (represented by Peter Krollman and Ernst-Otto Max) in the latter part of 1998 during which he put pressure on them to allow ADS to participate in the supply of the combat system for the submarines.
120. Subsequently and although HDW had initially included only the STN Atlas combat suite in its offer, HDW was, at Shaik's insistence, required to submit an alternative offer incorporating the ADS combat suite (although in the event HDW's strong preference for the STN Atlas combat suite was accepted in the final contract for the acquisition of the submarines).
121. I contend that Shaik actively campaigned on ADS's behalf in order to assist them getting business resulting from the acquisition of a new submarine.
122. Shaik's interaction with HDW and STN Atlas also prove that he directly violated his supposed recusal resulting from his declared conflict of interest in the naval combat suites.
123. Regarding Ferrostaal's conduct, this company has a long history of allegations of corruption being made against it.
124. The Portuguese Criminal Investigation Department has been investigating the recent 2001 submarine acquisition in suspicion that political parties and connected individuals may have received millions of Euros in bribes from MAN-Ferrostaal, in order to guarantee that it got the submarine contract instead of French competitor DCN-I.
125. It has been stated publically that the submarine acquisition for the Portuguese Navy is tainted with fraud, corruption, forgery of documents and bribery which is the reason why it is currently under investigation by both the Portuguese and German judicial authorities. In Germany MANFerrostaal directors have been indicted, arrested and are said to be negotiating compensation with the German authorities.
Allegations of Corruption : Jet Trainer and Jet Fighter Aircraft
125. The Applicant deals comprehensively in his papers with the allegations of bribery by British Aerospace (later BAE Systems) in respect of the LIFT component of the Arms Deal and by Saab and BAe in respect of the ALFA component of the Arms Deal.
126. Consequently I shall not deal in this affidavit with these aspects in as much detail as the other aspects.
127. However, it is clear from the multitude of affidavits of SFO Principal Investigator Gary Murphy, Senior DSO/DPCI Investigator Colonel Johan du Plooy, Senior NPA Prosecutor William Downer SC and NPA attorney Karla Saller, that there are credible allegations on oath of bribery on a vast scale by BAe and Saab (possibly BAe on behalf of Saab).
128. I have personally met Principal Investigator Gary Murphy and his colleague Barrister Lydia Jonson in my offices in Cape Town, at their request, to brief them on the Arms Deal in general and of possible overlaps of role players across the different legs. I have personally seen some of the analysis of documentary evidence regarding payments to individuals and financial "special purpose vehicles" set up to facilitate the flow of these so-called commissions, especially the covert commissions. In my view, all the SFO's evidence, which it has shared with the DSO and later the Directorate for Priority Crime Investigation (DPCI), is vast, credible, compelling and constitutes a prima facie case of corrupt dealings.
Joint Investigation and JIT Report
129. After the conclusion of the SDP contracts on 3 December 1999, many parties from civic society, losing bidders, opposition political parties, etc. were highly suspicious of most or many aspects of the Arms Deal.
130. Certain parties very close to the coal face of the Arms Deal gave then opposition MP Patricia de Lille a briefing on their perception of the illogicalities, irregularities and suspected criminalities involved. This was distilled into written form by certain parties later to become known personally to me, to become known as the de Lille Dossier.
131. Independently I had been put in contact with the Special Investigation Unit (SIU) then headed by former Judge Willem Heath.
132. MP de Lille then handed her evidence to the SIU along with mine.
133. This was done as this was meant to constitute prima facie evidence on the basis of which the SIU could request a presidential mandate to initiate a formal, full blown investigation in terms of the Special Investigating Units and Tribunals Act.
134. I then began working closely with the SIU's investigators, but soon (within two months) they advised me that they were unlikely to get a presidential proclamation needed for the SIU investigation.
135. The SIU advised me to pass my complaint to the Auditor-General which I did formally by means of a letter dated 11 July 2000 to the Corporate Executive Manager of the Office the Auditor-General, Mr Wally van Heerden who was then overall responsible for the Arms Deal investigation (refer Annexure J). This latter was after a meeting in Pretoria at the AG's head office with Judge Willem Heath, van Heerden, and a member of the firm TCG which was consulting for the OAG at that time.
136. MP de Lille's, mine and other allegations were consolidated and came to the attention of Parliament's SCOPA.
137. In October 2000, SCOPA formally initiated the joint investigation by the Joint Investigation Team (JIT), although it initially wanted the SIU to be part of the JIT.
138. A list of allegations entitled Report of Allegations (refer Annexure K) was compiled which formed the brief for the investigation.
139. The list contains 23 individual allegations to be investigated in the Arms Deal investigation.
140. Other than the Schabir Shaik and Tony Yengeni matters, there were no other successful prosecutions. There was one other prosecution against Ian Pierce, the accounting officer of FBS regarding the disappearance of company financial records for the relevant period leading up to the Arms Deal contracts. This prosecution failed through mismanagement of the case and poor co-operation between the NPA and SAPS.
141. Only a handful of the allegations listed in the Report of Allegations were even pursued in the joint investigation by the JIT. Indeed, although the allegations had been made as early as 2000 with a reasonable degree of detail being provided, including the nature of the wrongdoing, companies' names, individuals' names, even the sums of money thought to be involved, nothing was done by the South African investigating authorities in pursuing these allegations. It took foreign investigations in the United Kingdom and Germany in the mid-2000s period (circa 2005 to 2008), triggered by completely independent allegations of corruption in other defence equipment deals involving other countries, to yield documentary evidence which then caused the foreign investigators to seek the cooperation of their South African counterparts. Such co-operation then led to just two investigations in the late 2000 by the DSO and then the DPCI, i.e. the BAE Leg and the GFC Leg. These will be addressed in more detail later in this affidavit.
142. On 19 January 2001 in one of the most extraordinary visual spectacles on national TV, President Thabo Mbeki announced that the SIU would not form part of the JIT, just as the SIU had predicted to me in July 2000, with President Mbeki ridiculing Judge Willem Heath by name before a national TV audience.
143. One of the things Mbeki did during the TV spectacle was to wave about a set of organograms accusing Judge Heath drawing up these organograms and that they implied that both he and former President Nelson Mandela were linked to suspected corruption with regard to the Arms Deal.
144. I aver that Judge Heath did indeed not draw up these organograms. I did so in my company's boardroom in Kenilworth, Cape Town with the input of Bheki Jacobs, during late July and early August 2000. I still have the hand-drawn originals done with pencil on paper. I later converted these to computer form and have kept them more-or-less up-to-date since then.
145. The reason for us drawing up these organograms was to depict graphically how anyone trying to influence decisions or seek favours with government would possibly conduct such approaches. This was specifically in order to explain the Arms Deal to the investigators.
146. In this regard I had a meeting in my company's boardroom in Kenilworth, Cape Town during October 2000 with nine JIT investigators from the OAG, OPP, DSO and SIU. I used the set of organograms to brief them on the Arms Deal and gave each one of them an individually numbered copy printed in colour, on the condition of strictest confidentiality and that no copies or facsimile transmissions could be made of them.
147. I was quite surprised to see the president of the country waving around my organograms on a special afternoon broadcast on national TV and that some of these organograms were posted on the GCIS website.
148. In my view my organograms, even in those early days of mod-2000 accurately depicted the Arms Deal dealings and with some updates in the interim are as accurate and useful today as they were then. I attach the earlier computer versions of my organograms as Annexures L1 to L4 and the latest versions as Annexures M1, M3 and M4.
149. Without the independent SIU, the JIT undertook its investigation from early January until early November 2001. The Auditor-General (AG) was responsible for the so-called Forensic Audit, the Public Protector (PP) for the Public Phase and the National Director of Public Prosecutions (NDPP) for the Criminal Phase.
150. In my view, the very exclusion of the SIU, with its constitutional independence, unique investigative and legal skills and even more unique legal mandate and especially after initial recommendation of its inclusion in the JIT by SCOPA, is in itself worthy of independent investigation.
151. When the JIT published its Joint Report on 14 November 2001, I was thoroughly disappointed and indeed shocked at to its content and more importantly, at to its key findings and conclusions.
152. It is important to note the position taken on the JIT Report by the Chairman of SCOPA, Dr Gavin Woods after its publication and cursory review in Parliament. In summary he finds the JIT Report completely unacceptable. In support thereof he has published a number of formal publications on the Arms Deal and in particular on the JIT investigation, including :
152.1 SCOPA's Intended Arms Deal Investigation - The Interventionist Cause of Its Failure, dated January 2002;
152.2 The Arms Deal Investigation : Accountability Failure - a Critique of the JIT Report, dated February 2002;
152.3 Corruption in the Arms Trade, the South African Case - a paper presented at the Workshop of the 11th International Anti- Corruption Conference held in Seoul, South Korea on 25 May 2003; and 152.4 The Arms Deal Saga - a Current Perspective, dated circa January 2005.
153. Dr Woods was so dissatisfied with the joint investigation that he resigned as chairman of SCOPA soon after its JIT Report was reviewed in Parliament and later as an MP.
154. I had been working with a number of investigators of the JIT up until that time, including Advocates Charles de Chermont, Jan Swanepoel of the OAG, Dave Scrooby of the OPP, with Advocate Gerda Ferreira of the DSO, as well as an auditor from the Office of the Auditor-General, Etienne Smith. I had, in so doing, formulated a reasonable idea of what their evidence and findings entailed and therefore had formed some kind of expectation of their joint report. As it transpired, the published JIT Report was quite different to what I expected from authors who were professionals and officers of the court and had been investigating the Arms Deal for a period of a year or more.
155. I also was advised by persons very close to the investigation that the three agencies had written separate reports and that these separate reports had been submitted as a "joint report" to the presidency, MINCOM the DoD and even to Chippy Shaik for their review and approval before publication.
156. On thorough review of the JIT Report it became clear to me that it was a dissembled version of the three agencies' reports, re-assembled into a singular version, after having been subjected to extensive truncation and thorough editing.
157. I was told by an investigator that the original version was some 1 200 pages in length and that this was cut down to some 800 pages and then 400 pages because the presidency deemed the original version to contain too much detail.
158. I was told that the presidency "liked" the draft report of the Public Protector, but not that of the Auditor-General. The team was instructed to redraft and reconstitute the three reports as a single report, along with their own directives as to the key findings and conclusions.
159. Indeed Erika Gibson of Nasionale Pers had written an article in Die Burger dated 17 October 2001 and entitled Mbeki Gooi Verslag oor Wapensaak Terug (Mbeki Throws Back Report on Arms Investigation) which is very much along these lines (refer Annexure N1 with a translation into English as Annexure N2). She certainly did not get this information from me. Indeed I only knew of this article quite some time later as I seldom read the Afrikaans press where it was published unless I am directed to something in particular.
160. In response, the JIT Project Leader Advocate Lionel van Tonder of PWC Forensics Services, insourced to the Office of the Auditor-General, and Advocate Stoffel Fourie of the Officer of the Public Protector did precisely that during the period between 2001-10-14 and 2001-11-14.
161. It would appear to me that they did receive some assistance in the final assembly and editing of the final JIT report, probably from an English speaking senior member of Government Communications and Information Services (GCIS).
162. In short, the JIT Report whitewashed the entire Arms Deal, other than the Schabir Shaik criminal matter which was not in any case dealt with in the JIT Report.
163. Deeply concerned about this, I raised requests under the Promotion of Access to Information Act (PAIA) to the Office of the Auditor-General, the Office of the Public Protector, the National Director of Public Prosecutions, Armscor and the Department of Defence.
164. Armscor and the Department of Defence apparently agreed that the latter would handle my request under PAIA. The DoD then effectively refused my request and I was forced to take the matter on review to the High Court, which found in my favour and ordered the DoD to grant access to all the requested records. The DoD's response was very poor and I was forced to again take the matter to the High Court which again found in my favour. The DoD consequently did grant me a considerable number of records, many of which were rendered of no or negligible value due to the DOD's unlawful and extensive severing of the documents (which is omission of pages of records or obscuring parts of pages by means of erasing fluid, etc.). Although PAIA does make provision or severance, in this case at least this would have to be approved by the court and be for good reason within the provisions of PAIA. I submit that neither was there such approval, nor in the vast majority of instances was such severance justified in terms of national security, commercial confidentiality, etc.
165. The Office of the Public Protector effectively conceded to my request, albeit after much legal and administrative gamesmanship, but claimed that it had no records to provide me, other than a draft version of its Arms Deal investigation report and copies of the transcripts of its Public Hearings into the Arms Deal (the Public Phase). I already had these documents, having been a witness in the first place and having paid the transcription company for them. But it is extremely difficult for me to believe that the PP could have conducted a proper investigation into the Public Phase without having extensive relevant documentation, including correspondence with the involved parties as well as written submissions in response to the formalities of the hearings.
166. In any case, my legal and financial resources were limited and so I decided to concentrate on the Office of the Auditor-General and the Department of Defence and not pursue my remedies against the Office of the Public Protector and Arms for the time being.
167. Like the Office of the Public Protector, the Office of the Auditor-General opened its response in a manner design to frustrate my request for access to the Arms Deal investigation records. Initially it furnished a mere few hundred pages of documents, most of which came from and were indeed written by my own company.
168. As with the DoD, I was forced to take the matter on review to the High Court. Again the court found in my favour and although I agreed to a "Reduced Record" pertaining only to the Corvette Combat Suite leg of the Arms Deal and my complaints in this regard (which was in any case quite clear from the covering correspondence of my PAIA application), plus all the draft reports. The High Court ordered the Auditor-General to grant access to all the records that I had requested, including copies of all the draft investigation reports.
169. Again the Office of Auditor-General elected to comply with the court order according to its own interpretation thereof, including providing me only with copies of three of the twelve chapters of the draft reports and not the entire reports. So again I was compelled to take the matter to the High Court, this time to seek both full compliance of the court order and a further order for contempt of court and incarceration of the AuditorPage General himself should he not comply. Again the High Court found in my favour and sentenced the Auditor-General to imprisonment of one month, suspended pending compliance of the court order (judgment handed down 11 November 2004).
170. The Auditor-General took this on appeal to the Supreme Court of Appeals in Bloemfontein. The SCA upheld the High Court's judgment and order regarding access to the records, including access to all of and to the full versions of the draft reports (judgment handed down 31 March 2006). For the sake of completeness, I mention that the SCA did overturn the contempt of court finding, not on its factual merits, but on a different approach to the nature of the onus in contempt proceedings. As the proceedings were on motion and the SCA being unable to make credibility findings with the benefit of trial proceedings with evidence and witnesses being examined and cross-examined viva voce, the conviction was overturned.
171. I have no difficulty with the SCA's ruling on contempt, but it does not derogate from the point being made on the lack of co-operation which I received from the Auditor-General.
172. Nevertheless, in terms of actual conduct regarding production of the records sought under PAIA, the Auditor-General was in default of the High Court's order.
173. Subsequent to the ruling by the High Court, the Office of the Auditor- General proceeded to provide me with a large volume of records, including copies of the full versions of the draft reports and many, many copies of parts thereof.
174. Despite release of the draft reports, these were provided in so many forms and fashions, from complete versions of different drafts to partial versions, to just separate chapters. So in addition to their shear multitude and the difficulty in certain instances of determining chronology and relevance, it is difficult to analyse this evidence in its proper context.
175. What also I also know is that even longer versions of the AG's draft report were produced. One version that I received has Chapter 12 ending with Page 800. This means that the entire report would have around 900 pages. I never received a version with so many pages. So my conclusion is that, contrary to the court order, not all the draft versions of the full Report of the Auditor-General, were furnished to me by the AG.
176. Also missing from the released documents are pages of responses from the DoD to the AG's draft report, other than those relating directly to my own complaints. Omission of these pages was in my view contrary to both the letter and spirit of the court order because firstly they related directly to the draft reports, but they also related to my allegations that the DoD and/or presidency had been able to respond in detail to the draft reports prior to the final report as well as that any severance of records needed specific court approval, which was never requested let alone granted.
177. In any case, these draft reports refer to a multitude of findings of irregularities in segments of the SDPs other than the corvette combat suite, including the Lead-In Fighter Trainer (LIFT) segment, Advanced Light Fight Aircraft (ALFA), Light Utility Helicopter (LUH) and Coastal Submarine segments, and these findings were never included in the JIT's final JIT Report of 14 November 2001.
178. These findings of irregularities are vast in number, but for the sake of brevity I will supply just a few of the most important examples in this affidavit.
179. Part A - Public Protector, dated 2001-09-28, length 83 pages: there is an extra page inserted after the second page, plus insertions at the third page. All these are notes and instructions taken from the members of MINCOM (Ministers Erwin, Manuel, Lekota and President Mbeki) of their impressions of the draft report and how to change the report.
180. Part B - Auditor-General, dated circa 2001-10-04, length 194 pages: there is an extra page inserted after the Page 21. This also contains instructions taken from the members of MINCOM of how to change the report.
181. On Page 21 of the draft report it is stated as follows :
181.1 "1.8.1 The findings of the joint investigation support the majority of the key findings by the A-G as contained in his Special Review dated 15 September 2000."
181.2 "1.8.2 There were fundamental flaws in the selection of BAe/SAAB as the preferred bidder for the LIFT & ALFA programme."
These crucial findings have been excised from the final JIT Report.
182. On Page 57 of the draft report it is stated as follows :
182.1 "5.3 Findings
182.2 5.3.1 Decisions of the Minister of Defence that could have influenced the process."
182.3 "5.3.1.1 There is an indication that the former Minister of Defence that could have influenced the decisions of the role-players in the process, for example........"
183. Yet these findings were changed by hand as follows :
183.1 "5.3.1 the Visionary Approach of the former"
183.2 Paragraph 5.3.1.1 is deleted by hand in its entirety and does not appear in the final JIT Report.
184. On Page 159 of the AG's draft report it is stated as follows :
184.1 "12.4.3.7 In this regard the allegations of Dr R.M.M. Young clearly have substance."
184.2 Paragraph 12.4.3.7 does not appear in the final JIT Report.
185. Regarding the draft reported entitled Executive Summary to the Auditor- General, it is clear that the final JIT Report included only an extract of the executive summary of the AG's report. In this regard the three agency reports made up only about 280 pages whereas the final JIT Report had 382 pages in total; yet the draft of the full version of the AG's report entitled Strategic Defence Packages - Report of the Auditor-General and dated circa 4 October 2001 had 729 pages in total.
186. On Page 532 of the draft reported entitled Report of the Auditor-General it is stated as follows :
186.1 "11.5.11.4 During consultations with witnesses it was alleged that Messrs L Swan and S Shaik had intimidated certain staff members who had been opposed to the awarding of the contract to Turbomeca. The staff members concerned had been threatened with dismissal if they dared to openly oppose the said two persons."
186.2 Paragraph 11.5.11.4 does not appear in the final JIT Report.
186.3 Suffice to say that it is both an extremely important matter worthy of appearing in the final version of the report (unless such a finding had been completely negated in the interim - which should be independently documented) and that whatever the veracity of the facts this omission alone constitutes a substantive difference between the draft report and the final report. It needs to be noted that this draft report was a final draft report as existing circa 5 October 2001 and not an early draft.
187. So it is clear that the truncated executive summary of the AG's report got amalgamated with the reports of the PP and NDPP to become the final JIT Report, while the far more comprehensive Strategic Defence Packages - Report of the Auditor-General, with 741 pages in total, was abandoned.
188. One other important feature of the Report of the Auditor-General that disappeared between it and the final report was the comprehensive crossreferencing to evidence source documents. This substantially impairs a report's value as a forensic investigation report, indeed it impairs the value almost any non-trivial formal report at all.
189. In my view, once a full pre-final draft of a report has been produced for external use, then to abandon it at the final hour in favour of a highly truncated summary is it in itself inexplicable, unless a new imperative develops to change the content and shield the details from the target audience, which in this case was Parliament and the general public.
190. That this is what happened is an inescapable conclusion, because firstly it is impossible that a 741 page version of a report can be remotely similar in content to a 198 page version of it, or even a 384 page amalgamated version. Secondly, the radical change came directly after the heads of the Joint Investigation Team met with the President and the Ministers Committee.
191. It must also be remembered that this draft report was issued to the President and the Ministers Committee on 5 October 2001 with a view to the JIT reviewing it with them and tabling the final version in Parliament on 25 October 2001. As things transpired the final report was only tabled on 14 November 2001, this clearly being due to the very substantial effort to effectively almost completely dissemble and reconstitute the report.
192. It has never been publicly disclosed by the AG that he actually had a full draft investigation report (the Report of the Auditor-General), but that only a truncated summary of it was incorporated in the final Joint Report tabled in Parliament. This implies that only about 25% of the content of the AG's full report was ever formally disclosed. Furthermore, it remains unexplained and inexplicable why the more comprehensive and detailed report should have been abandoned in favour of the lesser version. This is in spite of a number of press articles, parliamentary questions and public questions regarding interference in the compilation of the final version after the draft was furnished to the President and the Ministers Committee for their review and input.
193. It is clear that there are numerous and substantive differences between the draft reports that were supplied to the President and the Ministers Committee and the JIT Report, this despite categorical statements made on a number of occasions within and outside Parliament by the then Auditor-General Shauket Fakie CA(SA) and the then Public Protector Selby Baqwa SC, i.e. that the only changes were formatting by nature and made in order to improve readability.
194. I would venture that the differences between the draft and final reports are numerous, substantive and include exceptionally serious omissions and even more serious additions.
195. I am bringing this to the attention of this Honourable Court for two primary reasons :
195.1 the complete breakdown of the joint investigation into the SDPs by means of direct executive interference by the President and the Ministers Committee and the consequent inexplicable acquiescence by the heads of the Joint Investigation Team in this regard by allowing the final report to be changed, thereby effectively terminating the Arms Deal investigation by giving the government a clean bill of health; and 195.2 recognising and accepting the above and thereby providing a full justified platform for a full, proper and independent investigation of the Arms Deal.
196. The draft reports contain information which Auditor-General may wish to hide.
197. Yet on a number of occasions in Parliament the AG and PP stated specifically that there had been no material changes between the draft report and the final report. They stated that the only changes were made to provide an improved user-friendliness to the document.
198. In this regard, the PP stated in Parliament on 4 December 2001 as follows, with emphasis added in bold type:
"Just one point. On the first question, which quotes the Auditor- General when we presented this Report as saying, views of the Executive added value. No substantive part of this Report is a reflection of the views of the Executive. That I would like to state categorically. The value that is being referred to is with reference to the format of the Report, because the Executive did comment about that. The Auditor-General talks about the 3 Sections when we were following the due process. The difficulty in the duplication that he has mentioned was that in my part of the Report I would have phrased another matter differently, and then they would say, which conclusion is the right one, or do we understand this to be similar. Because the words that the Auditor-General would use and that I would use would be different. So different people could interpret that differently. So the format changed in the sense that then it became one consolidated Report as you have before you now.
Page 53 of 76 But in terms of change this, don't write it this way, or something to that effect, never happened. And what is reflected here is the pure result of the Investigation."
199. In this regard, the AG stated just minutes after that at the same occasion in Parliament on 4 December 2001 as follows, again with my emphasis added in bold type:
"And it gives them (the President and the Ministers) the opportunity to bring to my attention something that is included in the Report that may be of national interest, and I must watch. And there was nothing in this Report, I want to give you assurance, which was identified as issues of national interest, that I need to take into consideration, except the fact that it was stated that the detailed quotations from Cabinet Minutes, etc. are privileged documents. We can look at those Cabinet Minutes. We can make the findings from those issues that were deliberated but the details of those quotations should not be here. That is the only issue we got input on."
200. It is relevant to compare what Mr Fakie and Adv. Baqwa have said in Parliament to what Fakie has given as evidence under oath in one of his replying affidavits, again with emphasis added in bold type:
"On the completion of the joint investigation the Second and Third Respondents and I each completed our draft reports independently.
Each of the reports contained our respective understanding of the relevant evidence, the evaluation thereof, as well as our opinions and findings. The draft reports were sent to the Office of the President for the sole purpose of having the factual content of the reports verified by Government. Our respective opinions and findings were not negotiable, nor subject to change at the behest of whomsoever in Government."
201. There simply cannot be any other conclusion, than that :
201.1 the differences between the draft joint report and the final JIT Report are stark, numerous and material; and
201.2 they were made by the JIT at the behest of MINCOM to protect the position of MINCOM, the Cabinet and the South African Government in their contracting position of the Arms Deal.
202. Indeed in my view the irregularities reported in the draft report are so serious that they are or give an indication of criminal conduct in certain areas and therefore the protection was indeed sought by and given to certain parties in their individual capacities and not their official capacities.
203. That such changes were sought by the executive reflects extremely seriously on them as individuals as well as as a collective acting in an official capacity.
204. However, that the JIT, specifically the heads of the Chapter 9 watchdog bodies constituted in terms of the South African Constitution to protect its citizens and the public against government wrongdoing, brought about these changes to the draft report that had been produced by the actual investigators, is a wrongdoing of such high magnitude and materiality (because it undermines the very kernel of the constitutional state), that there can never be a prescription of time or any other constraint for the investigation and prosecution of such conduct.
Thabo Mbeki
194. There are court records now in the public domain that the growing confidence of Thomson-CSF to be awarded the lion's share of the corvette combat suite contract stemmed initially from indirect contact with Thabo Mbeki through his interlocutor Yusuf Surtee and later through a series of interactions and face-to-face meetings directly between the top echelons of Thomson-CSF and Mbeki himself during the period late 1997 to mid-1999.
195. This period is particularly important in the context because 23 September 1997 is when the SDPs were formally initiated and 8 June 1999 is when the decision-making PCB formalised its selections of the system and equipment of the corvette.
196. Indeed in the encrypted facsimile dated 28 November 1997 from Pierre Moynot of Thomson-CSF Southern Africa) (Pty) Ltd to his superiors Michel Denis and Bernard de Bollardiere of Thomson-CSF France (the original in French attached as Annexure O1 with official English translation as Annexure O2), Moynot refers to Mbeki as having given his "assurance that we (Thomson-CSF) would be awarded (the contract) for the combat system and its sensors". As this was a full two years before the contract was awarded and a full year before contract negotiations commenced between the DoD and Armscor (on the one hand) and the GFC, Thomson- CSF and ADS (on the other hand), this assurance - and indeed any communication between Mbeki, as a member of the Cabinet and chairman of MINCON, and a potential foreign supplier (albeit this being through an interlocutor) - would be unlawful.
197. Evidence in court records indicate that Mbeki first met with Thomson-CSF Chairman Denis Ranque, Jean-Paul Perrier and Alain Thetard of Thomson-CSF of France in South Africa probably on 26 April 1998 (refer Annexures P1 and P2 and Annexure Q).
198. Court records also show that, on or about 17 December 1998, Mbeki met with Jean-Paul Perrier, Michel Denis and Bernard de Bollardiere of Thomson-CSF of France at its head office in Paris (refer Annexures R, S1, S2, T1 and T2).
199. That the 17 December 1998 meeting was preceded by another meeting is in essence confirmed by the Thales memorandum dated 27 November 1998 by senior Thint executive Bernard de Bollardiere who records (with my emphasis added in bold) as follows :
"THINT already privately had access, 6 months ago, to your President T. Mbeki and at that time handed him the name of a partner (the company C.N.I.) to play the "black empowerment" role in ADS and to thus be our political guarantee; this company has since declined the offer; we are currently trying to give this role to one of the member companies of the local consortium, FBS, which seems to have received the backing of the ANC.
Besides a contact whom we consider authorised by Mr. T. Mbeki recently informed Mr. J.P. Perrier in RSA that ADS "had met the requirements" with regard to Black empowerment We could receive a clear message from the President on this subject on his trip to Paris"
200. References to utterances such as "privately had access", "political guarantee", "backing of the ANC", "receive a clear message from the President" are a very severe indictment on the veracity and lawfulness of the acquisition of the corvette contract.
201. It must also be remembered that at this stage there was no formal requirement for Black empowerment in any government contracts and in particular in the SDPs. There was informal talk of a requirement for the involvement of SMMEs, i.e. Small Medium and Micro Enterprises, and later to PDIs, i.e. Previously Disadvantaged Individuals, but this was never a formal or stated requirement and indeed this aspect was later completely removed as a criterion for selection. Therefore any response to this that Black empowerment was a valid reason for these clandestine manoeuvrings and related conduct is entirely misplaced and indeed wrong.
202. The addenda to de Bollardiere's memorandum dated 27 November 1998 (Annexures T1 and T2) are entitled Meeting with Mr. T. Mbeki and Questions to be put to Mr. T Mbeki and are exclusively about the corvette combat suite and so the planned upcoming meeting of 17 December 1998 simply cannot be explained away as being about something else.
203. Likewise, the addendum to de Bollardiere's letter to Mbeki dated 18 December 1998 (Annexures S1 and S2) concerning the previous day's meeting is entitled "Thomson-CSF / Naval Defense Programs" is again exclusively about the corvette combat suite and so this meeting of 17 December 1998 also simply cannot be explained away as being about matters unrelated to the corvette combat suite.
204. There are further court records indicating that Thomson-CSF executives again met Mbeki at least once circa 10 February 1999 (refer Annexures U and V) and possibly again after 16 April 1999 (refer Annexure W).
205. The encrypted facsimile of 31 March 1998 (refer Annexure Q) refers to the Vice-Chairman of Thomson-CSF Jean-Paul Perrier to be arranging a meeting with Mbeki as well as with Jacob Zuma.
206. Subsequent documented communications also refer to meetings between Mbeki and Thomson-CSF and there is every reason to believe that that these meetings did indeed occur.
207. It is also a matter of public record that Zuma met with Thomson-CSF on a number of occasions in South Africa as well as in June 1998 in London specifically to discuss the matter of the corvette combat suite contract with Thomson-CSF.
208. This is all many months before the contract was signed and the latter meetings were right in the middle of a period of very sensitive contract negotiations between the DoD and Armscor on the one side and Thomson-CSF and ADS on the other side.
209. I contend that such intervention on the part of the chairman of MINCOM is highly irregular, unlawful and probably criminal, both in terms of the Constitution as regards government procurement and the Public Finance Management Act or its equivalents prevailing at the relevant time.
210. Giving veracity to the allegation of unlawfulness of Mbeki's conduct in meeting with Thomson-CSF in Paris and on other occasions, is Mbeki's amnesia in this regard.
211. Mbeki has responded to formal parliamentary questions about his meeting with Thomson-CSF in Paris where his response was that he cannot remember any such meeting. This is plainly incredible. While presidents of countries might meet a lot of people, forgetting about a meeting with the top executives in the boardroom at head office in Paris of one of the top five defence companies in the world (and the top two in Europe), while at the same time being the Chairman of MINCOM during the largest defence acquisition in the history of the country, is plainly unbelievable.
212. In the 17 December 1998 Paris meeting, the South African ambassador to France, Barbara Masekela was either present in the meeting or arranged the meeting. When questioned about this, at first she would also not confirm the meeting, but later remembered both her and Mbeki's involvement in the meeting.
213. That Masekela could also not initially remember this December meeting, is now a matter of public record as is that she now claims that although she can indeed remember the meeting, she cannot remember what it was about.
214. Again Masekela cannot be taken at her word because if one considers why Thomson-CSF would especially write her a letter (in French) the day after the meeting to thank her for setting up the meeting with Mbeki and that there is a very similar letter to Mbeki (in English) of the same date and it is clear from the annexure of the letter to Mbeki that the meeting was about the corvette combat suite, that there can be no other credible explanation for the meeting.
215. But adding very forcefully to this is the fact that Thomson-CSF then alludes in the encrypted fax dated 17 May 1999 (refer Annexure C) to it having offered Masekela some kind of business arrangement with it that was so sensitive that it required both an encrypted facsimile to bring it to the attention of Thomson-CSF head office and that Masekela felt the need to appoint one Jurgen Kogl to deal with Thomson-CSF on her behalf.
216. Making this all the more incredible is that I know that Masekela and Kogl met Thetard privately at his offices a number of times in the second quarter of 1999. It is clear that they were acting on Thomson-CSF's behalf.
217. Supporting my allegations of bribery regarding the combat suite is the examination of the contract price for the corvettes and in particular for the combat suite (this is detailed above).
Chippy Shaik
218. During 1993 Shamim (Chippy) Shaik, the brother of Schabir Shaik, was appointed by the ANC as MK's logistics representative in the transition period leading to the new political dispensation. During the 1993 to 1995 period he, inter alia, was the ANC's representative on the Arms Industry Workgroup which was responsible for drawing up a policy document for the entire Defence Family, as well as the ANC's representative on the Ministry of Defence workgroup which was responsible for advising the Minister of Defence as to the structuring of the Defence Force and the Ministry of Defence.
219. Indeed, Shaik was so immersed in the official work of the Ministry of Defence that he himself claims in his CV as follows :
219.1 that he was a "Signatory to the Draft National Policy for the Defence Industry which was submitted to the Subcouncil of Defence in April 1994";
219.2 that he conducted an "Analysis of the arms manufacturing industries and their role in a future South Africa"; and
219.3 that he gained an "Understanding of the defence industry's relationship between Military and Government and between Military and Industry".
220. During 1995 Chippy Shaik was appointed to the planning division of the DoD where he was instrumental in the Defence Review and its output, the so-called Force Design (the design recommended for the SANDF in the Defence Review and in which the core defence capability requirements of the SANDF and the nature and quantity of the equipment needed to fulfil those requirements were identified).
221. During May 1998 Shaik was appointed as DoD's Chief of Acquisitions, although he had been designated to take over this position at an earlier point in time. As Chief of Acquisitions Shaik was the Fund Manager of the Special Defence Account from which the SDPs were to be funded.
He was also in control of policy matters and planning relating to all acquisitions by the DoD.
222. Shaik was the chairperson of the Air Force and Naval PCBs and was also the person responsible for co-ordination with other evaluation teams and committees, including SOFCOM, of which Shaik was the cochairperson.
223. Shaik also was a senior member of the International Offers Negotiating Team (IONT), representing the Department of Defence.
224. Shaik also acted as secretary of the SDPs Ministers Committee (MINCOM).
225. By virtue of his brother's interest in ADS, Shaik at all material times had a conflict of interest in relation to the corvette and submarine combat suites in performing his official functions as :
225.1 DoD's Chief of Acquisitions;
225.2 chairperson of the Naval PCB;
225.3 co-chairperson of SOFCOM;
225.4 senior member of the International Offers Negotiating Team (IONT);
225.5 the secretary of the cabinet sub-committee (MINCOM)
dealing with the SDPs;
225.6 the official responsible for liaising with other committees and bodies in connection with the combat suite, including the cabinet sub-committee dealing with the SDPs, the Council of Defence and the AAC.
226. Notwithstanding the said conflict of interest, Shaik did not recuse himself from the deliberations of the Naval PCB, SOFCOM and the other bodies mentioned above and was allowed by the State to continue to perform all his official functions pertaining inter alia to the acquisition of the corvettes in general and the combat suites of the corvette and submarine in particular.
227. In performing his official functions as aforesaid, Shaik actively promoted the interests of ADS.
228. Shaik actively promoted the interests of ADS as follows :
228.1 Corvette Combat Suite 228.1.1 Shaik was aware that GFC's offer of May 1998 failed to meet DoD's minimum DIP requirements and of the advice furnished in that regard by Armscor's legal division;
228.1.2 ADS was a member of the consortium proposed by GFC as the primary vessel contractor; and
228.1.3 in order to ensure that GFC (and thus ADS as a member of the proposed consortium) was not disqualified from further consideration, Shaik - in his capacity as chairperson of the PCB and co-chairperson of SOFCOM - decided to condone GFC's non-compliance and to invite GFC (after the closing date specified in the RFFO) to make good its non-compliance (which took the form of a failure by GFC to provide a bank or sovereign guarantee to the value of 5% of GFC's proposed DIP commitment).
228.1.4 GFC thereupon made good its said noncompliance.
228.1.5 The PCB and SOFCOM were not informed by Shaik and were not aware :
228.1.5.1 of GFC's initial non-compliance;
228.1.5.2 of the advice furnished in that regard by Armscor's legal division;
228.1.5.3 that GFC had been invited, after the closing date of the RFFO, to make good the non-compliance in its offer; and
228.1.5.4 that GFC had provided the requisite guarantee only after the closing date of the RFFO.
228.2 On or about 26 May 1999 Shaik briefed MINCOM on the combat suite for the corvettes, during which briefing he inter alia gave a presentation concerning the combat suite.
228.3 Shaik was present at (and chaired) Naval PCB meetings held on 8 June 1999 and 24 August 1999 when the combat suite was discussed.
229. Regarding the German investigators' suspicion of Chippy Shaik receiving a bribe payment from Thyssen and in particular with reference to the recordal in the bribery agreement with Christoph Hoenings that this was in respect of "a group represented by him", I have seen, but do not have a copy, of a memorandum written by a foreign investigator to the South African authorities where it was recorded that they have a list of persons who received payments from the bank account of the company suspected of being used to launder the flow of funds, i.e. Meriam Ltd.
Vice Admiral Robert Simpson-Anderson
230. While Vice Admiral Robert Simpson-Anderson is on the list of persons of interest to the German investigating authorities regarding the corvette acquisition, he is also suspected of receiving a bribe from Thyssen.
231. In this regard I have seen, but do not have a copy, of a memorandum written by a foreign investigator to the South African authorities where it was recorded that they suspected that Chief of the SA Navy, Vice Admiral Robert Simpson-Anderson, received a bribery payment through the interlocutory services of one Vice Admiral Andries Putter, a former Chief of the SA Navy.
232. While this intrigued me at first, I was later advised that this indeed makes logical sense because Vice Admiral Putter was then "working for the French", who were partnered with the Germans to provide the patrol corvette to the SA Navy.
Abandonment of the Investigations
233. After the closing down of the Directorate of Special Operations (DSO)
after a political decision taken at the ANC's national conference in Polokwane in 2007, the only surviving Arms Deal investigation was that regarding the LIFT and ALFA.
234. This investigation was transferred to the new Directorate of Priority Crime Investigation (DPCI) under the SAPS Commercial Crime Unit headed by Major General Hans Meiring with the lead investigator being Colonel Johan du Plooy who had been transferred from the DSO.
235. I had in the meantime made written representations to Advocate William Downer SC of the National Prosecuting Authority (NPA) and copied these to then Senior Special Investigator du Plooy of the DSO regarding my request for further investigations into the corvette platform, corvette combat suite and coastal submarine legs of the Arms Deal as a result of new evidence emanating from the Schabir Shaik trial and investigations in Germany. My requests went unheeded for a long time (over two years)
until the DPCI started operations in mid-2009.
236. Certain information and evidence had in the meantime been passed to the DPCI regarding in particular the Chippy Shaik /Thyssen bribe and I was then approached by the DPCI to initiate its formal investigation into what it terms the GFC leg by submitting a formal complaint in the form of a comprehensive affidavit.
237. I agreed to this and on 27 October 2009 I subsequently submitted a comprehensive affidavit of 181 pages including annexures to the Knysna Police Station. It contains certain of the information which I have repeated herein.
238. After great intrigue, including SAPS in Knysna rushing down a copy of my affidavit to Cape Town at 04:00 am in order for it to be previewed by top provincial police officers before being sent to Pretoria (which had been my clear and specific request, indeed my instruction) the affidavit was sent to Pretoria and Colonel du Plooy registered Case No. Brooklyn 914/11/2009.
239. I know that great strides were initially made with this investigation, mainly due to a great deal of successful, albeit informal interaction between the DPCI on the South African side and the German prosecuting authorities on the other.
240. The evidence that was at hand after the German investigators had on 19 June 2008 raided Thyssen in Dusseldorf and its sister companies Blohm+Voss in Hamburg and MAN-Ferrostaal in Essen, including the Christoph Hoenings memorandum (refer Annexures B1 to B3) was sufficient for the DPCI to initiate a formal Mutual Legal Assistance (MLA)
request to the German authorities in order to get their official assistance, along with copies of the documentary evidence with official translations, the co-operation of witnesses, etc.
241. I am advised that a formal MLA letter of request was indeed given to the German prosecuting authorities, but after they had been working on the request for several weeks (possibly months), unexpectedly the South African authorities, through the Department of Foreign Affairs and Department of Justice, withdrew the MLA.
242. I am advised that the Germans were particularly piqued by this because they had spent a lot of time, effort and resources on complying with the request and only needed to complete official German to English translations of the documentary evidence, as well as a few other formalities, in order to complete their side of the MLA request.
243. I also believe that the South Africans' withdrawal of the MLA had severe repercussions for the German's own investigation against Thyssen. This was because without mutual South African assistance, their case against Thyssen was considerably weakened.
244. Eventually the German prosecuting authorities came to a plea arrangement with Thyssen whereby the latter pleaded guilty to some minor administrative irregularities while all the main bribery and corruption charges against the company and its officials were withdrawn.
245. Despite this setback however, the DPCI was still very confident of its case against Thyssen and Chippy Shaik in this country. This was because it was in possession of copies of the required evidence to support both a full investigation and the formulation of charges.
246. The DPCI was also hopeful that a full investigation would lead to the reopening of a formal investigative relationship with the Germans.
247. During the period November 2009 until September 2010 I was in regular contact with Colonel du Plooy and he was quite sure of his case.
248. Indeed in one instance I explained to him in a little detail why I thought that it was a quite straight-forward case. He kept completely quite for something like ten minutes before replying that "I know, I agree with you, I have recently put all that to my superiors in a written memorandum" (or words to that effect).
249. However, it began to become clear that he was started to get less and less support from his superiors and his unit.
250. It nevertheless came as a great surprise and disappointment to me when Colonel du Plooy telephoned me in around mid-September 2010 to advise me that the Head of the DPCI, Lieutenant General Anwa Dramat had secretly closed down the investigation a week prior.
251. It was only a week or so later after I had advised members of SCOPA of this that the press elicited an admission from Lieutenant General Dramat that he had indeed closed down the entire Arms Deal investigation.
252. Despite being the prime complainant in the Thyssen / Chippy Shaik leg and having gone to very considerable lengths in this regard, I never received either a formal communication nor reasons from DPCI for the abandonment of the investigation. Indeed I understood the telephonic advisement by Colonel du Plooy to be a courtesy from him personally.
253. Only very recently in the last two weeks has it become publicly known publically that a six-page memorandum undated, but clearly authored circa September 2010, from Major General Meiring to his superior Lieutenant General Dramat recommended to the latter to end the investigations into the Arms Deal, including both the fighter aircraft and corvette legs (refer Annexure X).
254. MP David Maynier recently obtained the memo from SAPS under the Promotion of Access to Information Act. He had applied for "all documentation relating to the decision to cancel the investigations" after Dramat's decision in early September 2010. He was given no further documents. It should be noted in this regard that the Meiring memorandum is undated. It is most probable that the memorandum was issued under a dated covering page. In my view it is highly unlikely that this was the only documentary record regarding the decision to abandon effectively ten years of Arms Deal investigations.
255. In any case, in my view, Meiring's memorandum is plainly superficial and indeed illogical.
256. Some of the more questionable aspects of Meiring's memo include :
256.1 it is highly superficial when measured against the gravity of the decision. The memorandum does not refer to any specific suspects, witnesses, dates nor evidence;
256.2 Meiring's grasp of the facts is tenuous. He calls BAE Systems "British Eurospace", presumably after its former name, British Aerospace. His claim that "the transactions relating to [the BAE] investigation refer back to the mid nineteens" [presumably mid- 1990s], failing to mention that the Arms Deal contracts were signed in early December 1999 and that allegedly corrupt payments flowed until at least 2007;
256.3 Meiring complains about the difficulty of getting foreign evidence, such as financial flows and company documents, while acknowledging that such information was already in the DPCI's possession after foreign investigators had shared it informally. Although the evidentiary value of informally obtained evidence is decreased, the evidence is known and formal channels remain potentially available;
256.4 Meiring complains about the difficulty of obtaining evidence after years have passed, while admitting the existence of about 4,7-million pages of documents, secured in a 2008 raid on BAE, Fana Hlongwane and others. But this positive aspect he turns into another negative, on the basis that it would require further effort to "peruse and analyse";
256.5 Meiring argues, contradictorily, that although "cost implications to conduct an investigation cannot be a consideration ... it should not be ignored". He also complains that "a team of dedicate[d] investigators and prosecutors would be required" -- although the appointment of such teams is presumably standard in important, complex cases;
256.6 Meiring claims that "the three suspects in the BAE leg have all passed away". Modise, defence minister during the period of arms procurement and Richard Charter, one of BAE's local agents, have indeed both died, but the identity of the third dead suspect is a mystery. Certainly, Hlongwane, who was regarded as a suspect, because he could have influenced the deal as Modise's official defence adviser and subsequently received more than R200 million in payments from BAE and its partners, is alive and well;
256.7 Meiring claims there is "no prima facie evidence against any person" in the BAE matter, even though a South African judge confirmed an offshore freeze on Hlongwane's funds as the "proceeds of crime". Although he has denied wrongdoing, Hlongwane has not denied receiving payments from BAE;
257. Meiring dismisses the entire GFC investigation involving Chippy Shaik in three paragraphs tacked on to the end of the document, claiming that "the reason mentioned in the BAE case is also applicable to the German Frigate Consortium case". This flies in the face of firm evidence.
258. Apart from being very thin on reasoning Meiring's memorandum is also very thin on facts. Just one important fact that I know regarding this matter is that the SFO has interviewed as a possible suspect or possible witness a former very senior executive of BAe, this being Alan McDonald who headed BAe's International Marking and Sales Organisation (IMSO)
at the time of the Hawk and Gripen deals. Indeed his name appears on the JIT's list of matters for its investigation. McDonald has admitted to receiving GBP5 million in reverse kickbacks from the deal and would thus be severely compromised. In my view, not only is this evidence from a high-level deal insider relevant to a successful criminal case, but such a compromised suspect is ideally placed as a state witness.
259. In my view, the difficulty of a successful prosecution against the prime suspects and prime movers in this case are very substantially over-stated by Major General Meiring.
260. In the corvette matter, Shaik's alleged R20-million bribe is documented in Thyssen company memoranda obtained in raids by German investigators and informally shared with the South Africans. As described earlier in this affidavit, Thyssen is the lead company in the GFC. In one key memorandum Thyssen executive Christoph Hoenings recorded that Shaik "asked once again for explicit confirmation [of] the verbal agreement made with him for payment to be made in case of success, to him and a group represented by him, in the amount of $3-million" (refer Annexures B1 to B3).
261. Further corroborative documentation is understood to include an instruction in which Shaik allegedly nominated accountant Ian Pierce to receive the payment.
262. German magazine Der Spiegel reported two years ago that Meriam Ltd, an offshore company represented by Pierce, received $3-million in April 2000, the same month that South Africa paid the GFC the first instalment on SA Navy vessels ordered from it.
263. The Mail & Guardian newspaper subsequently identified at least some financials flow, these being five payments totalling roughly R500 000, from Meriam Ltd to a South African bank account held by Pierce.
Conclusions
264. The acquisition of the Hawk and Gripen was a contrived affair with a pre-determined outcome.
265. The acquisition of the MEKO 200AS corvette, including its platform combat suite were contrived affairs with pre-determined outcomes.
266. The acquisition of the Type 209 coastal submarine was a contrived affair with a pre-determined outcome.
267. The Hawk contract was pre-destined to be awarded to British Aerospace through the dealings of Thabo Mbeki and Joe Modise.
268. British Aerospace saw the opportunity in respect of the ALFA and purchased 30% of Saab in order to win the Gripen contract.
269. The corvette platform and submarine contracts were pre-destined to be awarded to German companies while the corvette combat suite contract was pre-destined to be awarded to ADS and its French owner.
270. Being so pre-determined would have been because of bribes being due when the contracts were awarded.
271. Even though the contracts were pre-determined, systems were in place to give a semblance of due process to the selections. However, these secondary processes actually had different initial outcomes to those predetermined.
272. It required very skilful manoeuvring by the upper echelons and their lackeys like Chippy Shaik in order that the final selection processes resulted in the same selections as the pre-determined outcomes.
273. This involved firstly the deployment of Modise's own chosen right hand man, Chippy Shaik, into the all-powerful and ubiquitous position of Chief of Acquisitions, operating throughout the multiple levels of the selection processes. Shaik was able to use this position to ensure that necessary information was selectively channelled in such a way as so not only finally cause the selection of the pre-determined winners, but in such a way so as to preclude the watchkeepers from being aware thereof.
274. In addition to Shaik's role, there are clear instances of the manipulation of quantitative scores and scoring systems to force the numerical results supporting the pre-determined outcomes.
275. In both the cases of the corvette and the submarine acquisition process a forensic analysis shows that both the scoring systems and the scores were manipulated and abused. This constitutes not only acquisition irregularity of the highest order, but criminal fraud.
276. The joint investigation into the Arms Deal was manipulated by government to ensure that it gave a clean bill of health. Yet the draft investigation reports preceding the final JIT Report and preceding MINCOM's review of the draft joint report indicate, even in those early times, very material irregularities in most of the legs of the Arms Deal.
277. The heads of the Chapter Nine institutions heading the joint investigation, in particular Auditor-General Shauket Fakie CA(SA) and Public Protector Selby Baqwa SC, not only allowed the reports drafted by their subordinate investigators to be materially changed at the best of MINCOM, they lied openly to Parliament and on affidavit in this regard when questioned directly and on numerous occasions. Their conduct needs to be investigated.
278. The closing down of the final investigations into the Arms Deal, specifically the fighter aircraft and corvette platform legs, is entirely illogical and unwarranted, especially the latter where the documentary evidence is quite fresh as well as very clear and compelling.
279. In accordance with the above facts and supporting information, my knowledge of the facts is such that I would welcome the appointment of an independent commission of enquiry into the Arms Deal and specifically to address, inter alia, the following :
279.1 to investigate and report upon the possible involvement of Thabo Mbeki, Chippy Shaik and Thyssen in the declaration of the German Frigate Consortium as preferred bidder for the corvettes;
279.2 to investigate and report upon the possible involvement of Thabo Mbeki, Chippy Shaik and Thyssen in the awarding of the corvette contract to the European Corvette Consortium of South Africa (including the GFC, Thomson-CSF Naval Combat Systems and African Defence Systems);
279.3 to investigate and report upon the possible involvement of Thabo Mbeki, Chippy Shaik, Pierre Moynot, Alain Thetard and Thomson-CSF in the awarding of the corvette combat suite contract to Thomson-CSF Naval Combat Systems and African Defence Systems);
279.4 to investigate and report upon the possible involvement of Thabo Mbeki, Joe Modise, Chippy Shaik and Ferrostaal in the awarding of the submarine contract to the German Submarine Consortium;
279.5 to investigate and report upon the possible involvement of Thabo Mbeki, Joe Modise, Chippy Shaik, Fana Hlongwane and Richard Charter in the awarding of the LIFT contract to BAE Systems;
279.6 to investigate and report upon the possible involvement of Thabo Mbeki, Joe Modise, Chippy Shaik, Fana Hlongwane and Richard Charter in the awarding of the ALFA contract to BAE Systems and Saab;
279.7 RAdm(JG) Kamerman's resignation from the SA Navy as its Projects Director and his joining as its Vice President of International Sales Thyssen Krupp Marine Systems (TKMS), which in effect was an amalgamation of the German Frigate Consortium and German Submarine Consortium which supplied the corvettes and submarines to the SA Navy;
279.8 to investigate and report upon the manipulation of the JIT Report both by MINCOM as well as the Auditor-General and Public Protector;
279.9 to investigate and report upon the averments the Auditor- General and the Public Protector regarding changes from the draft investigation reports to the final JIT Report;
279.10 to investigate and report upon the abandonment of the LIFT and ALFA legs of the investigation by the DPCI;
279.11 to investigate and report upon the abandonment of the Thyssen / Chippy Shaik leg (GFC leg) of the investigation by the DPCI.
Signed June 14 2011
Richard Michael Moberly Young
I certify that the above signature is the true signature of the Deponent and that he has acknowledged to me that he knows and understands the contents of this Affidavit, which Affidavit was signed and sworn to before me in my presence at Knysna on this 14th day of June 2001 in accordance with the requirements of Government Notice No R1258 dated the 21st July 1972 as amended by Government Notices No R1648 dated the 19th August 1977 and R1428 dated the 11th July 1980.
Commissioner of Oaths
Click here to sign up to receive our free daily headline email newsletter
