Arms deal commission phase two: Enter the whistle-blowers

Phase two of the arms procurement commission’s public hearings will start on Monday. Now, the commission will deal with the second leg of its terms of reference: allegations of fraud and corruption. It has called a number of authors, arms deal critics and activists, to present evidence.

Richard Young will be this phase’s first witness. Besides being the first of the so-called “critics” to give evidence to the commission, his testimony will also provide insight into the purchasing of four patrol corvettes for the South African navy. 

It is this leg of the arms deal – the corvette purchases – from which the charges against President Jacob Zuma stem, and the charges against his financial adviser, Schabir Shaik. 

The charges against Zuma were dropped in 2009.   

Who is Richard Young?  
Young is the managing director of CCII Systems, which lost the bid to supply the combat suites – weapons and defence systems – for the corvettes. The winning bidder of that leg of the deal was Thomson-CSF, while the German Frigate Consortium (GFC) won the tender to supply the ships. 

Shaik was convicted of one count of fraud and two counts of corruption in 2005 for securing a bribe from French arms company, Thomson-CSF, on behalf of Zuma. 

The court found that the bribe was to ensure the protection of the arms company from the 2000 joint investigation into the arms deal. Young’s company would later go on to be a major supplier to the United States Navy.

What does he know?
In a 2011 affidavit submitted to the Constitutional Court in support of activist Terry Crawford-Browne’s attempts to force government to institute a judicial commission of inquiry into the arms deal, Young described himself as a sort of dumping ground for all manner of allegations into the deal. 

Young described how whistle-blowers, including those from within government and the ANC, had approached him over the years to reveal the extent of the rot at the core of the arms deal. Additionally, Young claims to have had access to key developments in international investigations into the South African arms deal. 

At the time, German prosecutors had sought the assistance of South African authorities in investigating allegations of bribery and corruption in relation to the corvette deal. Young told the court that while he did not have a copy of the official notice sent to the South Africans asking for their assistance, he had a copy of one sent to Swiss authorities, which he said was identical.

From this and more than 20 volumes of documentation, Young claimed to have evidence from the German authorities that was highly suggestive of bribery; documents that detailed requested bribes from South African officials, as well as how these bribes would be funnelled so as not to seem suspicious. (Reportedly, the German authorities received no help from the South Africans, and their probe was consequently shut down in 2008.) 

“The German authorities formally allege bribery of some $2-million paid to a range of high level South African functionaries through a Liberian registered company, Mallar Inc … ,” Young told the court.

‘A kind of clearing house’
Another $3-million was paid through a British company, also for the benefit of South African officials, according to Young’s information. “Regarding these whistle-blowers, many of them prefer not to come forward publicly 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.

“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,” Young’s affidavit declared.   

He also told the court that he was in possession of a legal opinion, obtained by Armscor, which said the GFC should be excluded from the bidding process as it did not meet certain tendering requirements. Nevertheless, the GFC won the bid in a process that Young and others believed was the result of manipulated scoring. 

Young described the bidding process for the corvettes as “highly stage-managed” so as to favour the GFC.   

What happens next?
On Friday, after former president Thabo Mbeki’s testimony, Judge Willie Seriti granted an application by Lawyers for Human Rights (LHR) to cross-examine former public enterprises minister, Alec Erwin.

Commission spokesperson William Baloyi confirmed on Sunday that a date for this cross-examination would likely be arranged this week.

But, it is unlikely to happen on Monday or Tuesday, as LHR’s advocate Anna-Marie de Vos is not available.

On July 24, City of Cape Town mayor Patricia De Lille will testify. The dossier she presented to Parliament in 1999, when she was a member of the Pan Africanist Congress, will be explored by the commission. The “De Lille Dossier” blew the whistle on many allegations of corruption in the arms deal that linger today.

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Sarah Evans
Sarah Evans

Sarah Evans interned at the Diamond Fields Advertiser in Kimberley for three years before completing an internship at the Mail & Guardian Centre for Investigative Journalism (amaBhungane). She went on to work as a Mail & Guardian news reporter with areas of interest including crime, law, governance and the nexus between business and politics. 

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