Arms broker did give cash to the ANC

Confidential documents obtained by the Mail & Guardian reveal that arms giant ThyssenKrupp desperately lobbied the government in an attempt to head off a German probe into South Africa’s arms deal.

The dossier shows that a lawyer for Sven Moeller, a local Thyssen representative, has written repeatedly to Justice Minister Brigitte Mabandla and justice Director General Menzi Simelane to try to prevent the seizure of documents and the interrogation of witnesses in South Africa.

The German prosecuting authorities are probing claims that the company bribed South African officials and politicians to land a contract for warships for the South African Navy, and have formally asked the South African government for assistance. Moeller is a suspect.

So far, the South Africans have not acceded to the Germans’ request.

The ‘Mabandla dossier” sheds new light on dealings with the ANC during the arms deal bidding process and raises new questions about President Thabo Mbeki’s role.

It reveals:

• that Tony Georgiadis, Thyssen’s South African lobbyist during the bid process, paid R500 000 into ANC coffers, as previously alleged by Independent Democrats leader Patricia de Lille. The ANC has previously claimed to know nothing about this ‘donation”;
• that Georgiadis also paid R500 000 each to the Nelson Mandela Children’s Fund and Graça Machel’s development charity in Mozambique;
  
• that British police recently raided the London business premises of Georgiadis, who reportedly had Mbeki’s ear at the time of the arms deal negotiations. Swiss authorities have been asked to search accounts linked to Georgiadis at the bank Credit Suisse, also at the request of the German prosecutors;

• that Thyssen paid $22-million to a Georgiadis company, Mallar, following the conclusion of the warship deal in 2000.

German prosecutors allege Mallar was used to channel ‘at least the major part [of the $22-million] to South African officials and Cabinet ministers”. Georgiadis has denied this allegation.

In a clear warning to Mabandla of the German probe’s dangerous implications, the dossier includes a letter from a rogue South African businessman, Nick Achterberg, alleging Thyssen had paid more than R100-million to Mbeki in a Swiss bank account.

However, Achterberg’s letter makes it clear that the claim is hearsay; Thyssen’s lawyers have dismissed it as ‘fanciful and ­ridiculous”.

The Moeller letters to Mabandla claim that the German investigation was initiated as a result of Achterberg’s allegations.

This is contrary to other accounts, which have suggested that tax deductions claimed by Thyssen on commission payments in other deals prompted the German probe.

Moeller’s lawyer, Ian Small-Smith, insists in the representations to Mabandla that the German request for help is ‘one-sided, less than frank and misleading” as well as based on ‘misappreciation of the facts” and ‘unjustified assumptions”.

It also alleges that the request amounts to a ‘smoke screen” to allow the German authorities to investigate ‘many innocent residents, businessmen and office-­bearers in South Africa”.

Generous Georgiadis
But the Mabandla dossier confirms that in 1999 Georgiadis personally made out the R500 000 cheques to the ANC and the Mandela and Graça Machel funds.

German investigators found copies of the cheques during a raid on the home of Thyssen executive Christoph Hoenings in 2006.

Moeller’s lawyer tells Mabandla this was entirely innocent: ‘It is readily ascertainable from Mr Georgiadis,” he writes, ‘that he donated R1,5-million in three amounts of R500 000 to the above entities.

‘He has made donations to these kinds of charitable institutions in the past — indeed on this occasion [it was] at the request of Mr ­Mandela himself.”

The dossier says Georgiadis sent copies of the bank drafts to ‘individuals and organisations that he is acquainted with, and challenged them to follow suit, and also donate money to the charities —”

It says it would be unimaginable for the ANC, Mandela or Graça Machel to ask for payments to charity in order to influence the arms deal. ‘Clearly some vast assumptions have been made by the German Prosecuting Authority which are an insult not only to persons such as Mr Georgiadis but to very prominent people in South Africa without any justification.”

The warrant
The Mabandla dossier also contains a copy of the search warrant issued for Georgiadis’s London company, Alandis, which the UK’s Serious Fraud Office raided in November last year.

As Small-Smith notes, the warrant seeks any documentation relating to a wide range of South African individuals and organisations, including Mbeki, Jacob Zuma, the ANC, Trevor Manuel, former parliamentary defence committee chair Ntsiki Mashimbiye, former defence minister Joe Modise, J (presumably Jay) Naidoo, Mandela and the Nelson Mandela Children’s Fund, the Shaik brothers, Armscor and its former chairperson Llew Swan, Mac Maharaj and Tony Yengeni.

The Mabandla dossier says this shows ‘the German Prosecuting Authorities have managed in England to make a wide-ranging inquiry which amounts to an abusive fishing expedition”.

The search warrant sketches the outline of Georgiadis’s relationship with Thyssen and one of its senior executives, Jurgen Koopmann.

It notes that Georgiadis met members of the Thyssen consortium as early as 1994 and that the ‘1st Mallar Inc agreement” was signed on April 26 1995, while two more agreements with Mallar were signed at the end of May 1996.

Lobbying efforts
These were presumably ‘agency” or ‘commission agreements” appointing Georgiadis as a lobbyist for the consortium. Such agreements are often used in the arms trade as a cover for bribe payments.

Under the heading: ‘re Koopmann kickback enquiry” the warrant also suggests German authorities are investigating whether entities linked to Georgiadis channelled money back to the Thyssen executive.

The letters to Mabandla give a blow-by-blow account of Thyssen’s frantic lobbying efforts.

Small-Smith first wrote to justice director general Simelane on November 25 last year, when it became known that German prosecutors had asked South Africa’s justice department for ‘mutual legal assistance”. The lawyer asked for a copy of the request and an opportunity to respond to its allegations.

The dossier shows that when Small-Smith received Simelane’s December 12 reply, which he considered unsatisfactory, he immediately went over his head to Mabandla.

At a meeting at her home on December 13, he says he extracted an undertaking from her to provide Thyssen with a copy of the German prosecutors’ request.
Nevertheless, the director general resisted this demand, stating that there was no legal requirement for him to release such information.

As a result, Small-Smith hand- delivered the confidential dossier to Mabandla on February 18.

ThyssenKrupp said it was cooperating fully with the investigation and was ‘confident that the suspicion of illegal commission payments will not be confirmed”.

In replies received as the M&G went to press, Mabandla’s spokesperson, Zolile Nqayi, denied the minister had received Small-Smith’s representations. He also denied any insinuation that Small-Smith had had preferential access to Mabandla, saying the lawyer had been brought to her home ‘by someone that she knows and trusts, and this was without her knowledge or prior warning”. Nqayi also denied Mabandla had undertaken to give Small-Smith a copy of the German prosecutors’ request for assistance.

The mysterious Mr Achterberg
The most startling documents contained in the ‘Mabandla dossier” concern allegations — dubbed hearsay and false — that implicate President Thabo Mbeki in an alleged kickback of 40-million German marks (roughly R120-million) from arms bidder ThyssenKrupp.

The allegations are documented by Thyssen’s South African lawyer, Ian Small-Smith, in a bid to demonstrate to Justice Minister Brigitte Mabandla how unreliable the German investigation is.

In his first letter to her, care of her director general, Small-Smith writes: ‘We would hold out another example of how the German prosecutors mislead or ill-inform foreign states … The entire investigation was ignited by an e-mail forwarded to the German prosecutors by a certain Nick Achterberg in June 2002. Therein he stated that he was told by a man called Phillipe Mueller that another man called Sven Hansen had paid President Thabo Mbeki a 40 000 000 [German marks] bribe to buy corvettes from the German suppliers.” Mueller was the head of a Thyssen subsidiary in South Africa. Small-Smith alleges that Achterberg may have been referring to Sven Moeller.

‘We are advised that Phillipe Mueller, the alleged source of this fanciful and ridiculous information has never deposed a statement confirming this allegation. Effectively, in strict legal terms, we have unsupported, unconfirmed and contradictory hearsay of a man (Achterberg) who has been guilty of falsely accusing Thyssen — of paying bribes in other matters as well.”

In the Mabandla dossier Small-Smith adds some detail to this story, providing a copy not only of the email from Achterberg to the German authorities, but also an earlier fax, sent on July 12 2001, to Thyssen Materials in France.

That fax correctly reflects the name of Sven Moeller and also makes the allegation about Mbeki. It appears intended to put pressure on Thyssen France, with which Achterberg was disputing a supply contract for his South African-based cobalt refinery, International Metal Processing.

In his email to the prosecuting authorities, Achterberg says the money was ‘transported from Dusseldorf to Geneva by executive jet” for deposit in ‘an acount held by Thabo Mbeki”. He says Phillipe Mueller had explained the bribe as standard Thyssen practice in ‘jungle-bunny countries”.

It is not clear why the German authorities never took a statement from Mueller, but they may have considered Achterberg an unreliable source.

Achterberg emerged as a player in the controversial Union Mines affair. His offshore company, Spring Consultants, took control of the penny-stock company and boosted its share price massively by announcing a deal to supply processed cobalt to Thyssen. Investors poured in. Six months later, in July 2000, Spring cancelled the deal and the share crashed.

Next, Achterberg was involved in touting a fluorspar mine to an American company Honeywell International. Honeywell would put in funding to upgrade the mine in exchange for contracted supplies of fluorspar, an ingredient in the manufacture of Teflon and refrigeration gas. Honeywell put up about $4-million before they realised something was wrong.

According to a November 2007 US court judgement against Achterberg and his companies, the money was misappropriated, including being used to buy a yacht, the MV Integrity. Achterberg disappeared.

The M&G this week traced him and his yacht to Nassau in the Bahamas. He did not return messages.