/ 10 November 2014

Chippy Shaik brings renewed interest to arms deal

Chippy Shaik
Chippy Shaik


The long-awaited appearance of Shamin “Chippy” Shaik at the arms deal commission on Monday is likely to bring some renewed interest to the beleaguered inquiry. Shaik, government’s head of acquisitions during the 1999 arms deal, is set to give evidence for four days this week. 

Previous high-profile government leaders involved in the deal have proved to be something of a damp squib, and there is a high probability that Shaik’s testimony could prove to be the same. Previous similar testimonies, such as those of former ministers from ex-president Thabo Mbeki’s cabinet sub-committee handling the deal, were characterised by bouts of memory loss on the part of witnesses, combined with limp-wristed evidence leading. 

Nevertheless, there is at least one controversy previously introduced by the commission’s evidence leaders that reads as something they could quiz Shaik on. During the testimony of Ronnie Kasrils, former deputy defence minister, evidence leaders hinted that the state’s reasons for purchasing the Hawk aircraft, sold to South Africa by BAE Systems, could be contested. It emerged that a 1998 meeting, at which it was allegedly decided that the more expensive Hawk would be purchased, two contradictory minutes were taken. 

One set of minutes was penned by Shaik. This set of minutes recommended to Mbeki that the acquisitions team wanted the Hawks to be purchased. Another set of minutes, which was produced by evidence leader advocate Simmy Lebala during Kasrils’ evidence, shows otherwise. 

This set was drawn up by Henderich de Waal Esterhuyse, a former general manager of aeronautics and maritime at Armscor. Esterhuyse reportedly drew up the minutes after reading Shaik’s version, which he disputed. 

In Esterhuyse’s version, it was decided at the meeting that both options being considered – the Italian and British offerings – should be investigated further. Kasrils said he had never heard of the other set of minutes until they were presented to him at the commission. Former defence secretary Pierre Steyn was highly critical of the decision to purchase the Hawk, and later resigned over it.  

Steyn and Esterhuyse’s versions lend some weight to the theory that politicians involved rode roughshod over what the defence force wanted. If this is true, the question remains: why? A series of explosive allegations, leaked to the Mail & Guardian in 2008, reveal the extent to which the Hawk contract was allegedly manipulated.   

Suspicious payments
The allegations stem from leaked documents from Britian’s Serious Fraud Office, which at one point investigated the South African arms deal. The allegations revolve a series of suspicious payments made to South African officials via a complex web of offshore companies.

So far, the commission has yet to hear oral evidence on this detail. But it has in its possession tomes of documentation setting out the allegations. In 2007, a German newspaper alleged that Shaik had received a bribe worth about R21-million via another arms deal winning bidder, Thyssen Krypp. 

At the time, German authorities were investigating the arms deal. Then, in 2004, Shaik entered the mining industry in a venture that did not pan out. His financial partner was Ferrostaal, part of the German Submarine Consortium, another winning bidder.   

A report commissioned by Ferrostaal to determine its liabilities with regards to the arms deal, completed by law firm Debevois & Plimpton, questioned the commercial rationale: Shaik apparently contributed very little to the deal, financially. Yet besides the minor controversy around the 1998 minutes, the other allegations about Shaik have yet to surface at the commission. 

Another test of the Seriti commission
This week’s evidence will be yet another test of the Seriti commission’s will to truly unpack the controversy. William Baloyi, the commission’s spokesperson, confirmed on Friday that Shaik would be represented by the state attorney, although he could still use private counsel. 

His brother Yunis has previously acted as his lawyer and the M&G understands Yunis has been seen at the commission during pre-hearing consultations. But Baloyi could not say whether Yunis would represent Shaik at the commission. Baloyi said Shaik was afforded representation by the state because there was some confusion as to exactly which government department he would be representing at the commission.   

Who is Chippy Shaik?
Shaik is the less-famous brother of Schabir Shaik, President Jacob Zuma’s former financial advisor who was convicted of fraud and corruption in 2005 for soliciting bribes on behalf of Zuma from French arms company, Thales. 

The third Shaik brother, Mo, headed the National Intelligence Agency. He acted as the South African National Defence Force’s head of acquisitions during the arms deal. In a matter unrelated to the arms deal, Shaik was famously stripped of his doctorate by the University of KwaZulu-Natal. 

The Sunday Times reported that his doctorate was fake and that it was littered with plagiarism. The professor concerned denied the plagiarism claims. 

But in 2011, City Press reported on claims that R750 000 had been paid to the supervisor of his degree, from arms company BAE Systems. The payment was allegedly made by a local BAE subsidiary to a firm whose sole director was Shaik’s supervisor.   

Shaik was suspended from the South African National Defence Force because he allegedly showed his attorney a classified document. This was during the course of investigations into his role in the arms deal. He later said he resigned out of his own free will. Shaik emigrated to Australia shortly after the allegations surfaced. 

In a 2007 interview, he said the situation had become “toxic” for him. Explaining his decision to leave, Shaik reportedly said, “And it has been this way for years. There has been an ongoing campaign against me, obviously as a result of Schabir’s troubles. I don’t need it.”