Zuma payments: Of battleships and Nkandla

Jacob Zuma's Nkandla ­homestead was born in arms-deal sin. The ongoing saga of the construction, financing and outfitting of the president's rural seat captures the mixture of chaos, influence and excess that seems to characterise Zuma's relationship with money – and with his many benefactors.

Watch our video with the investigative team behind this story

And, of course, the story of Nkandla also weaves in the thick strand of graft introduced by the notorious "encrypted fax", which alleged that Zuma and Schabir Shaik had concluded a secret bribe agreement with French defence company Thomson-CSF.

Read more on the 'kept politician'

Zuma corruption: South Africans have a right to know
Secret report reveals how millions flowed to Zuma
Banks bent over backwards for Zuma
All the president's willing benefactors: Part one
All the president's willing benefactors: Part two
Other politicians at the Zuma trough

The history of the Nkandla development set out in the report by audit firm KPMG prepared for Zuma's trial is striking for how many people were involved in paying for it before the president spent a cent.

It was Zuma's close friend, Mpumulanga businessperson Nora Fakude-Nkuna, who first approached architects on his behalf in February 2000 and it was her company, Bohlabela Wheels, that  paid the R34 200 bill.

Indeed, it is a mystery how Zuma expected to be able to pay for the project at all, because his monthly living expenses were already more than double his monthly income – unless, of course, he was expecting a new cash injection.

That is the view KPMG takes of the meeting between Zuma, Shaik and Thomson's South African boss, Alain Thetard, which took place on about March 10 2000 in Durban.

The meeting was captured in Thetard's March 17 2000 encrypted fax to his bosses in Paris setting out what transpired.

Thetard wrote that he had asked Shaik to obtain a "clear confirmation" from Zuma, or "at least an encoded declaration" to "validate" a request made by Shaik at the end of September 1999.

Thetard indicated that he had defined a code and Zuma had given  the coded confirmation.

Thetard reminded his bosses of the two main objectives of the "effort" they were being asked to make: "Thomson-CSF's protection during the current [arms deal] investigation" and "JZ's permanent support for future projects". An "effort" of R500 000 a year was indicated.

Shaik told his trial this meeting was about a donation to Zuma's charitable education trust, an explanation rejected by the court. In February 2003, Zuma denied to Parliament such a meeting had taken place.

In any event, Zuma's builder, Eric Malengret, started on the Nkandla project in about July 2000. The agreed price was R1 340 000.

Events proceeded as follows:

See our interactive timeline here

August 14 2000  R100 000 sourced from Bohlabela and Fakude-Nkuna is deposited to Malengret's company account by Zuma's nephew, Kusa;

October 4 2000 R40 000 more arrives from Bohlabela;

October 6 2000 Shaik writes to Thetard regarding "the subject matter agreed by ourselves in Pretoria … Several months later no real action. I share the sentiment with my party that he feels let down." Shaik adds that this is "particularly unpleasing" as "my party" had "proceeded to an advanced stage on a certain sensitive matter";

October 17 2000 – former president Nelson Mandela's R2-million cheque lands in Zuma's account. On the same date Zuma, apparently by agreement with Mandela, issues a cheque for R1-million to Zuma's charitable education trust;

October 18 2000   an unidentified person, named only as "Sew", deposits R50 000 in notes to Malengret's account for Nkandla. The same day, Shaik transfers R900 000 out of Zuma's account to settle some of Zuma's debt to the Nkobi group. An amount of R100 000 is left to reduce Zuma's overdraft. Shaik is apparently un-aware that the R1-million is intended for the Development Africa Trust;

October 19 2000 Shaik confirms in writing his instruction to Malengret the previous day to halt construction on the Nkandla residence. Malengret later testified that Shaik had exclaimed: "Does he [Zuma] think money grows on trees?";

November 2000  Vivian Reddy enters the scene, lending Malengret R50 000 to ease his cash-flow problems owing to Zuma's tardiness in reimbursing him for work completed;

December 6 2000  Zuma tries to write a cheque for R1-million in favour of the Development Africa Trust, ­apparently unaware that Shaik has moved the funds;

December 7 2000 Shaik instructs the bank to stop payment of the Zuma cheque, but now presumably realises he needs to repay Development Africa;

December 8 2000  Shaik faxes to Thetard an application form for a  "service provider agreement" involving four tranches of R250 000. The Shaik trial later ruled the agreement was a sham to disguise payments from Thomson. In his covering letter, Shaik writes: "Kindly expedite our arrangement as soon as possible, as matters are becoming extremely urgent with my client";

February 16 2001 R249 725 from Thomson is deposited into Shaik's Kobitech company account;

February 28 2001 A Kobitech cheque for R250 000 is deposited with Development Africa. Shaik issues three more postdated cheques for R250 000, but they are eventually stopped. Shaik repays Development Africa only much later;

October 9 2001 The Scorpions launch search raids in Durban, France and Mauritius;

June 7 2002  Zuma applies to FNB for a bond for Nkandla, assisted by Reddy;

December 12 2002 FNB confirms to Reddy that the bond over the property has been registered in an amount of R900 000;

January 25 2003  The first debit order to service the FNB bond is debited against Reddy's account for an amount of R12 117;

June 2 2005  Shaik is convicted of corruption;

June 14 2005 Mbeki fires Zuma as deputy president;

June 20 2005 the National Prosecuting Authority announces it will charge Zuma;

June 23 2005 Mandela ­transfers R1-million to Zuma; and

June 25 2005  Zuma makes his first bond payment for Nkandla.

* Got a tip-off for us about this story? Email [email protected]

The M&G Centre for Investigative Journalism (amaBhungane) produced this story. All views are ours. See www.amabhungane.co.za for our stories, activities and funding sources.

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Sam Sole Author
Guest Author
Sam Sole
Sam Sole works from South Africa. Journalist and managing partner of the amaBhungane Centre for Investigative Journalism. Digging dirt, fertilising democracy. Sam Sole has over 17731 followers on Twitter.

Related stories

How graft arrests came together

Learning from its failure to turn the Schabir Shaik conviction into one for Jacob Zuma, the state is now building an effective system for catching thieves. Khaya Koko, Sabelo Skiti and Paddy Harper take a look behind the scenes at how law enforcement agencies have started creating consequences for the corrupt

Infrastructure key to economic recovery — Ramaphosa

The governing party wants localisation at the centre of its infrastructure-led strategy

Politicians must be held accountable

Endless, toothless internal integrity committees are not the way out of corruption

Richard Calland: South Africa needs a Roosevelt style of leadership

President Cyril Ramaphosa needs to hold ‘fireside chats’ and have more power and institutional muscle around him, writes Richard Calland

This beef smells like manure

What’s that animal sound? Is it a Hawk swooping? A chicken roosting? No, it’s Zuma remembering a beef

Editorial: Arrests expose the rot in the ANC

The ANC has used its power to create networks of patronage. And this means going after corruption will cost the party financially

Subscribers only

Toxic power struggle hits public works

With infighting and allegations of corruption and poor planning, the department’s top management looks like a scene from ‘Survivor’

Free State branches gun for Ace

Parts of the provincial ANC will target their former premier, Magashule, and the Free State PEC in a rolling mass action campaign

More top stories

Baby Awa: The miracle baby born on a boat fleeing...

More than 300 000 people in the north of the country have been displaced by militants who ransack villages and then burn them down.

Five suspects arrested in Senzo Meyiwa case

Police minister Bheki Cela announced on Monday that his team has arrested five suspects who were allegedly involved in the killing of former Bafana Bafana captain Senzo Meyiwa.

EFF eyes municipalities ahead of 2021 local government elections

EFF leader Julius Malema says the party is preparing to govern in many municipalities from next year. It is also launching a programme to defend the rights of farm workers

WSU suspends classes and exams to avoid the spread of...

The university says it has to take the precautionary measures because 26 students have tested positive on its East London campus

press releases

Loading latest Press Releases…

The best local and international journalism

handpicked and in your inbox every weekday