"The moment when something which has been kept hidden, becomes exposed"

Issue No 008
18 September 2003

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Challenging the corrupters – challenging the corrupt

Deputy President Jacob Zuma, addressing the 9th International Anti-Corruption Conference (IACC) in Durban on 15 October 1999 rightly pointed out that, ”There is a need to continuously send a message to those who thrive on corruption that we have the will to deal with them decisively. The extent of corruption in all spheres of our lives has touched us, even as we conclude this conference an act of corruption is being committed somewhere….”

Indeed as the allegations surrounding him, his financial adviser Shabir Shaik and certain French arms peddlers have once again shown, corrupt relationships, particularly those in large public sector procurement deals, involve both public servants in the South and large multinationals in the North. Around the time of Zuma’s speech, according to the charge sheet produced by the Scorpions against Shaik, a deal was being cobbled together involving the three aforementioned parties: alleged bribe-payer, alleged bribe-taker and alleged intermediary. At present a French magistrate is considering an application by the National Prosecuting Authority for legal assistance in order to get Mr. Alain Thetard and Jean Paul Perrier, both former representatives of the French arms company Thompson CSF (now Thales) to testify in South Africa. According to newspaper reports the French Ministry of Justice will make the final decision based on the magistrate, Edith Boizettes’ recommendations. Their evidence together with that presented in the Shabir Shaik trial is key to ensuring that the cloud hanging over the head of Jacob Zuma, since he was a implicated in a case of corruption but not charged, is finally cleared – one way or the other.

However, as the Lesotho experience (See Top SADC story) shows there is a need to challenge the corrupters as well (See Industries). Powerful multinational companies apparently have little to loose when offering lucrative bribes to public officials. Should a deal be made with the French Ministry of Justice to secure the co-operation of the Thales officials – this should not include their immunity from prosecution in both France and South Africa. That would rob both the South African judiciary of an opportunity to test this case and equally importantly allow France to escape its legal obligation to prosecute citizens for bribing foreign public officials (see Profile section on the OECD Convention). This situation would no doubt suit many parties – and not least the arms companies. The South African prosecuting authorities have demonstrated political will by investigating allegations of corruption involving the Deputy President. The French authorities should now show equal adherence to the rule of law by investigating the affairs of the Vice-President and CEO of Thales International, Mr. Perrier as well as his colleague Mr. Thetard, the officials implicated in the Shaik charge sheet.

Equally concerning are the allegations that Bulelani Ngucka was an apartheid spy. If Ngucka was a spy, then the pending cabinet investigation must prove this convincingly. Alternately it smacks of the kind of political intrigue adverted to by Xolela Mangcu regarding Steve Biko. An icon of our struggle for liberation, Biko was once falsely accused of working for the CIA (See National Administration).

Whatever the allegations however, where appropriate the law must be allowed to take its course to ensure that justice is equally applied. In similar vein we must guard against pronouncing Deputy President Zuma corrupt until he has had an opportunity to defend such accusations in a court of law.

It would ultimately be at our own expense – and that of somebody in the position of Jacob Zuma if we accepted his argument also made at the 9th IACC that, “There is something that I have always believed, … and legal people might not agree…. We work out our constitutions that identify and clarify how the countries and society should be run, legislate the laws and place greater emphasis on the rights of all of us …, but…the counter balance of this has not yet been addressed. If members of society violate these rules and laws how do we deal with that situation? And of course after violating them quote the very rules as important to protect their rights in many ways. How do we balance these two? For I believe if we don't work out particularly in the judicial systems the way to deal with this, you find a contradiction - a contradiction of the very interpreters of the law for an upright society. In the legal profession having to be the one to defend the offenders to the hilt, to me this seems to be a contradiction. Whilst we respect and should respect the right of any citizen to be defended I think we also need to promote the right of society, not to be hurt by us.”

Indeed the rights of victims have to be recognised. However, those accused of paying bribes, or taking them or spying for the apartheid regime must be afforded an opportunity to prove their innocence. Anything else is tantamount to favouring mob law – something that will do our often sterling collective efforts to combat corruption in South Africa an injustice.

PUBLIC SERVICE

NATIONAL ADMINISTRATION

Catching the corrupt no easy task

The Business Day reports that the Prevention of Corruption Bill, which is expected to be passed by parliament by the end of this year, criminalises a wide range of corruption offences related to tenders and the bribery of foreign public officials abroad. This includes the blacklisting of corrupt businesses and excluding them from bidding for state contracts. The article explains that “similar laws passed by the Organisation for Economic Co-operation and Development make it possible for people such as European Aeronautic and Space Company chief Michael Woerfel to face prosecution in Germany for the discount on a Mercedes Benz he gave former African National Congress chief whip Toni Yengeni in return for support for Woerfel’s company’s arms deal bid”. According to Daryl Balia, chairperson of Transparency SA, the current Corruption Act that allows only for the prosecution of a person who accepts a bribe and not the person who initiates it. “The cases against Yengeni, Woerfel and Deputy President Jacob Zuma, who was investigated for allegedly trying to solicit a R500 000 bribe from arms contractor Thomson CSF, show how difficult it can be to make a successful case”. Prof. Andre Thomashausen from UNISA says that a lack political will and the difficulty in proving causality are preventing convictions involving the controversial arms deal.

He goes on to add that “The bottom line is that the German civil code and other agreements hold that a contract that came about as a result of undue influence should be considered null and void. The risk is that in uncovering too much information, someone may suggest pulling the plug on the agreement”. Recently national directorate for public prosecutions head Bulelani Ngcuka said he was unable to press charges against Zuma because of a lack of evidence against him, but leaves open the possibility that the case can be reopened if new information emerges.
Full article in Business Day: www.odiousdebts.org...

The Zuma controversy: How the case against Shaik implicates deputy president

The Sunday Times provides an overview of state’s charge sheet, as filed in the Durban Regional Court, that includes a breakdown of all payments Schabir Shaik made on Deputy President Jacob Zuma’s behalf while he was MEC for Economic Affairs and Tourism in KwaZulu-Natal, and later as deputy president. The charge sheet alleges that Zuma received R1.161-million from Shaik and Nkobi between October 1 1995 and September 30 2002. During this time Zuma’s duties included promoting the interests of business impartially as MEC from May 1994, leader of government business in Parliament from June 1997 and deputy president of the ANC from December 1997 and later attending Cabinet meetings related to the arms deal. Zuma’s impartiality comes in question during 1997 / 1998 period when South Africa requested offers from potential suppliers of military hardware. On May 11 1998 Thomson CSF (France) and Altech Defence Systems (ADS) in joint venture partners with German Frigate Consortium submitted an offer for corvettes. According to the report “ Thomson was worried about rumours that Mbeki did not approve of Nkobi as a business partner. Shaik’s brother Shamin or “Chippy (chief of arms acquisitions for the Department of Defence) met Thomson boss Alain Thetard on July 9 1998 and allegedly threatened to make things difficult if Thomson did not choose “convenient” business partners. Chippy confirmed that Zuma would be a member of the next Cabinet. Thomson CSF (France) had invested directly in ADS (not Thomson’s SA Subsidiaries). This effectively excluded Nkobi from the corvette bid”. Zuma used his influence as cabinet minister when “cabinet chose the German Frigate Consortium as preferred corvette supplier on November 18 1998. That same day Nkobi (represented by Shaik) and Thomson CSF (France) met at Nkobi’s Durban headquarters. Zuma attended the meeting as a ‘mediator to resolve the dispute’ and ‘also in the promotion of empowerment’. He allegedly helped Nkobi get shares in ADS. According to the charge sheet the “result of the above mentioned meeting was that Nkobi Investments became a joint venture partner with Thomson in the German Frigate Consortium and so joined the successful bidder in the corvette bid”. These allegations amongst others made on the charge sheet needs to weigh its substance in the scales of justice.
Full article in Sunday Times: www.suntimes.co.za...

Zuma for sale

In the Mail & Guardian the “draft charge sheet in the Scorpion’s case against Shaik demonstrates just how thoroughly Shaik allegedly ‘owned’ the deputy president and deployed him as ‘political capital’. The charge sheet leads this allegation when it indicates how Zuma apparently lived beyond his own earning power, letting him therefore be ‘owned and subsidised’ by “Shaik or Nkobi to the tune of R29 000 to R37 000 a month”.
Full article in Mail & Guardian (29 August – 4 September) ...

It all started here

Two-and-a-half years ago a humble paragraph in the Mail & Guardian set in moltion a train of events that led the Scorpions to focus on Jacob Zuma’s role role in the arms deal. It started with with questions surrounding shareholders in Nkobi holdings, Then with the assistance of a former Shaik employee who blew the whistle investigators were led to the “ March 2000 encrypted fax in which a Thomson/Thales representative told his colleagues about Zuma’s ‘confirmation’ of an alleged request for a R500 000 annual bribe. This information in turn led investigators, some time before or during August 2001, to Thomson offices in Midrand that seemed to corroborate the request. In October that year Ngcuka’s investigator’s raided Nkobi, Shaik and Thomson/Thales premises in South Africa and, with judicial assistance, abroad. The documentation obtained seemed to indicate a prima facie corruption case against Shaik, Thomson/Thales or some of its employees, and Zuma.”
Full article in Mail & Guardian (29 August – 4 September 2003) ...

Ngcuka’s balancing act does justice to Marshall’s legacy

Ronald Suresh Roberts argues in the Business Day that Bulelani Ngcuka, as director of prosecutions treads constitutional minefields as carefully as did the first chief justice of the US. Ngcuka proves that “revolutionary solidarity and clean governance are allies, and not enemies”. This is demonstrative of his preparedness to sting anyone – “within the presidency or elsewhere – who would cloak crookedness in the national flag”. The author compares Ngcuka to the US Chief Justice, John Marshall, as he explains that what “Marshall did for the independence of the US Supreme Court, Ngcuka has just done for the independence of the Scorpions. He has won the war by actively asserting the right of SA’s legal system to prosecute, if factually justified, a sitting deputy president. Meanwhile he has let pass the dangerous bait – the actual battle of dragging Zuma through the courts in a borderline case where a not-guilty verdict would destroy the Scorpions. Pragmatism in legal institutions is a scarce resource and Ngcuka is thankfully blessed with it. To see the extent of his victory, consider the fact that no sitting US president or vice-president could be prosecuted in a criminal court until after they stepped down. … In this country, our leaders now have no such comforts. This is a world-beating expression of the rule of law.”
Full article in Business Day: www.bday.co.za...

Seeking to draw Scorpions’ sting

Mcebisi Ndletyana writes in the Sowetan that the Scorpions “is one of our finest post-apartheid achievements. Any pressures to silence it would be a shameful politically-inspired manoeuvre to hide elite corruption…. By appointing an African to prosecute other Africans dispells the racist stereotype that Africans do not hold each other to high ethical standards. The political leadership affirmed that the path of post-apartheid society would not be determined by anxieties arising from racial prejudices. Rather, the ruling elite would strive to be the best it could be, guided by its moral code… Surely our leaders have enough foresight to appreciate that the value of the Scorpions’ achievements far exceeds the political survival of an individual. After all, ANC leaders are in politics for the public good. Or are they anymore?”
Full article in Sowetan (August 27 2003) ...

Masters of political diversion do SA’s revolution no favours

The Director of the Steve Biko Foundation, Xolela Mangcu writes in the Business Day the question facing Africans today is whether we are going to allow the corrupt elite to define who we are, in the name of African solidarity, “Are we going to allow rumour-mongering to define and debase our political discourse”. According to Mangcu’s sources in the ANC it was Mac Maharaj “who started the vicious rumour that Steve Biko was a spy and that he black consciousness movement was a third force sponsored by the US' CIA…Maharaj repeated that allegation to Neville Alexander in Europe... However, the rumour was recycled throughout the 1980s, and more often than not became the basis of internecine violence between supporters of the ANC and black consciousness movement. Many young people lost their lives in the wake of that rumour.
Full article in the Business Day: www.bday.co.za...

Arms scandal smouldered too long

Allister Sparks writes in the Cape Times that the “arms deal saga, culminating now in a bitter political conflict that threatens to tear apart the government, the country and some of our most important institutions, is a classic example of inept crisis management. The blunder goes right back to the beginning, to the government’s failure to clear up all questionable aspects of the arms deal as swiftly and comprehensively as possible. Instead it has weaved and ducked. …It first hassled Judge Willem Heath’s Special Investigation Unit, preventing it from an investigation into the arms issue, then pressurised parliament’s watchdog Public Accounts Committee (Scopa) to the point where its chairman, Gavin Woods, and the ANC’s own Andrew Feinstein quit in despair. Eventually a joint investigating team consisting of the Auditor-General, produced a report, which was heavily criticised by opposition parties in parliament. Now the highly successful Scorpions investigation unit, headed by the Director of Prosecutions, Bulelani Ngcuka, is caught up in an unseemly conflict with Deputy President Jacob Zuma, while the latter’s financial manager, Schabir Shaik, faces charges of corruption which implicate Zuma.” The writer concludes, “ that the whole issue should never have been allowed to reach this destructive stage. It should have been cleared up years ago.” According to the writer, “Good damage control is part of good governance.”
Full article in Cape Times: www.armsdeal-vpo.co.za...

PROVINCIAL ADMINISTRATION

Mpumalanga health scandal prompts cabinet reshuffle

Africa Eye News reports that “Mpumalanga reshuffled its cabinet in a desperate damage control exercise after three damning corruption reports leaked to the media. The forensic reports, which have been suppressed since February, detail massive fraud and nepotism within the province’s HIV/Aids programmes, hospital tender processes, and daily management of the health department. Shocked investigators called for immediate criminal charges and restructuring, but Premier Ndaweni Mahlangu sat on all three reports for six months and initially attempted to withhold them from both the Auditor general and the Scorpions, before authorising the panic reshuffle. Over 200-pages of detailed evidence against Manana and her health department head Rina Charles includes confirmation that: Gross mismanagement of Mpumalanga’s R19 million HIV/AIDS budget includes prima facie evidence of fraud that resulted in wastage on questionable items such as gospel concerts, soccer matches, and a dubious ‘cultural village’; That Charles allegedly tampered with multi-million rand tenders, failing to disclose that the changes might benefit companies linked to her brother-in-law Percy Siboza; That equipment orders for provincial hospitals were deliberately and artificially ‘padded’, resulting in fruitless expenditure of at least R13,7 million.; and that companies which refused to pay ‘commissions’ or form joint ventures with Siboza, health department head’s brother-in-law, had their contracts frozen or cancelled. The reports recommended urgent criminal charges against Charles and her chief financial officer, Richard Mnisi, as well as a litany of additional disciplinary charges ranging from dereliction of duty to ‘influencing suppliers’, and violating financial controls. Provincial director general, Advocate Stanley Soko, was unable to explain the apparent suppression, or government’s six-month delay before acting against Manana and Charles. He was also unable to say why no criminal charges had been lodged as yet.”
Full article at AllAfrica.com: allafrica.com...

Probe clears TIK chairman

According to Business Report “Manana Nhlanhla, the chairperson of Trade and Investment KwaZulu-Natal (TIK), has been cleared of all allegations of corruption, misconduct and maladministration following an investigation by auditor PricewaterhouseCoopers (PWC). The allegations were that Nhlanhla was appointed as a consultant to TIK and paid R700 an hour; travelled extensively at TIK’s expense; appointed a Chinese agent, who had brought no business to TIK, in mainland China at R80 000 a month; appointed herself as executive chairperson; used a TIK document to tender for a low-cost housing project in Empangeni; and used TIK funds of R100 000 to host a private party at her house. The investigation by PWC concluded that there was no evidence Nhlanhla had appointed herself as a consultant to TIK; The extent of travel was not excessive and was TIK-related business; The appointment of the Chinese agent was made by the board following due process, and the assessment of business value of the agent was for the governing structures to assess; the allegation of using a TIK document for a tender was prepared for TIK focussed on trade opportunities related to housing rather than provided information that would assist a developer to tender for a project; In terms of the party a series of functions were held over three days in December 2002 as part of a programme in which TIK, in partnership with the KwaDukuza municipality, hosted business leaders and investors to expose investment opportunities in Kwazulu-Natal. The full cost of all the functions was not unreasonable. TIK deputy chairperson John Barton said it was right that such allegations were investigated, but this was often a stressful and damaging process for those directly affected, particularly when the allegations were found to be groundless. Nhlanhla said she was delighted the TIK board followed due process and engaged an independent company to conduct the investigation.”
Full article in Business Report: www.busrep.co.za...

LOCAL ADMINISTRATION

Claims of graft in traffic office

The Sowetan reports that recruitment at Pretoria West Traffic Office is not following due processes. “ Five recruits were reportedly employed because they were relatives or children of senior officers in the traffic management section of Gautrans; a senior official allegedly announced the appointment of an officer to an advertised senior post at an East Rand traffic office long before applicants were interviewed and some senior officials sat on the panels which interviewed their relatives to ensure that they got employed.” The office of transport MEC Khabisi Mosunkutu, which was not aware of the allegations, invited the public to use the toll-free number to report corruption or fraud in his department at toll-free: 0800 600 9333 or his office on (011) 355 7553.
Full article in Sowetan (August 27 2003) ...

Three convicted for defrauding Cape Town municipality

“Two former Cape Town municipality employees and a local businessman were convicted in the Bellville Magistrate’s Court for corruption and fraud in a vehicle spares scam, which has cost the municipality millions of rands. Terrence Abrahams, Patrick Lynch and Allan Mills, a Table View businessman, operated a double-invoice, round-tripping scam which resulted in the council repeatedly paying for the same vehicle spares. The scam took place over a number of years at the Hillstar vehicle maintenance depot where the council’s refuse removal vehicles were maintained and repaired. The council’s auditors called in the Scorpions, the SA Revenue Services, the Assets Forfeiture Unit and forensic auditors from Deloitte and Touche to help them. Since the arrests two years ago, the depot has reflected a savings of R8-million a year. According to Mike Marsden of the Cape Town Unicity “that results in lower tariffs for our communities, better service delivery and uplifts the morale of the staff”. One of the alleged masterminds behind the scam, Ronald Thornton Hume, immigrated to New Zealand when investigations started. The Scorpions have started extradition proceedings. The assets of the three convicted men have been confiscated.
Full article at iafrica.com: iafrica.com...

INDUSTRIES

Challenging the corrupters

Giving attention to the bribe-makers as opposed to the more public attention of the bribe-takers, Hennie van Vuuren highlights the scant attention given to this part of the corruption process in the Mail & Guardian. He writes that “in South Africa, the focus has not been there, but tiny Lesotho may show the way. With limited resources, a solid case and what appears to be an exemplary belief in the notion of legal equality, Lesotho has hauled some of the world’s largest construction and engineering companies before the Bench. The multinationals stand accused of making numerous bribe payments to a Lesotho official in order to secure contracts linked to a multibillion-rand dam project. The prosecution has conducted this expensive trial largely at its own cost – despite as yet unfulfilled promises dating back as long as four years by the World Bank, the European Union and the South African government to provide financial assistance. In handing down sentence, Judge Gabriel Mofolo notes ‘the courts in Lesotho took a serious view of bribery, in that corruption attacked the administration of the public service and bedevilled good governance’. Lesotho has put into practice a principle that in order to break the cycle of corruption it is necessary to punish both the bribe-payer as well as the corrupt public official. South Africa has taken a page from the Lesotho case “when Bulelani Ngcuka informed the public that the National Prosecutions Authority (NPA) had forwarded the French authorities documentation pertaining to the alleged payment of a bribe by the local representatives of Thomson/Thales, challenging the French authorities to act on the matter…Ngcuka has, provided us with an interesting opportunity to test the commitment of the French government and its prosecuting authority to the rule of law”. Van Vuuren notes that the “French press and civil society will now need to sit up and take notice and apply pressure on the Ministry of Justice to investigate the case. Large corporations have at present everything to win and little to to loose from dangling attractive carrots in front of public servants and elected officials. The time is ripe for both the South and the North to apply the stick to such behaviour”.
Full article in Mail & Guardian: www.sametsi.com...

Busted now pay up R57m fine

According to the Cape Times writer Fatima Schroeder, “bus company Golden Arrow, was convicted of fraud after a two-year Scorpions investigation, and has to pay the state R57-million – the highest amount in South Africa to date in a commercial prosecution. Most of the R57-million was repaid to the national department of transport during the course of negotiations between the company, and the Scorpions, which culminated in a plea bargain concluded in the Wynberg regional court. The plea agreement came after the Scorpions found that the company incorrectly linked government subsidised passenger cards between 1997 and 2000. In terms of the Prevention of Organised Crime Act, Golden Arrow agreed to pay R6-million into the Criminal Assets Recovery Account. It was fined a total of R5, 59-million. Since the fraud came to light, Golden Arrow has regularised its entire control of the subsidy system to meet government requirements.”
Full article in Cape Times: www.mfp.co.za...

Kebble to fight fraud, theft charges

Chantelle Benjamin writes in Business Day that the “Randgold Resources chairperson Roger Kebble will face 40 charges of fraud and contravening the Companies Act, or 59 charges of theft, according to papers filed by the state in the Johannesburg Commercial Crimes Court. Reacting to the charges, Kebble said he would bring a high court application for an order setting aside the decision to prosecute him, on grounds that the investigation was conducted with contaminated evidence, including that produced by investigators hired by mining firm Durban Roodepoort Deep. The charges relate to work done for Durban Deep by Global Economic Research, with the payments channelled through Kebble’s Skilled Labour Brokers. Kebble was deputy chairman of Durban Deep at the time. Court papers allege that Skills Labour Brokers inflated the value of invoices issued by Global Economic Research by about R3, 8 million.
Full article in Business Day: www.bday.co.za...

SOCIAL JUSTICE

HEALTH: Hefty corruption case docket arrives by truck

After two-years of investigation of corruption and fraud in the KwaZulu-Natal department of health amounting to R32-million, this is undoubtedly the biggest case – in terms of numbers – in South Africa, producing a mammoth docket of 1600 bulky files which has taken 10 people more than three hours to pack, creating a logistical nightmare for the police and the department of justice. Most of the111 people arrested thus far in the case “are department of health officials who allegedly took bribes in return for giving certain companies contracts with the department. The other – approximately 30 – suspects are the businessmen who are alleged to have paid the bribes”.
Full article in The Mercury: www.iol.co.za...

Health: Government urged to intervene in chaotic EC drug depots

“The Eastern Cape’s two pharmaceutical depots are in such a state of disarray and corruption that their ability to distribute desperately needed anti-retroviral (ARV) drugs to AIDS sufferers in the province is highly unlikely”. In a statement, the Rhodes University-based government-monitoring unit, Public Service Accountability Monitor (PSAM), said a Joint-Corruption Task Team had unearthed R16 million worth of fraudulent or erroneous payments made by the depots between 1998 and 2000. The Eastern Cape Health department failed to submit financial statements or documents about the depots for eight years between 1994 and 2002, with a yearly government health statistics at 150 000 children expected to die from AIDS related illnesses in one year alone. The department’s 2001/02 annual reports were unable to verify their drug procurement transactions for this period. PSAM research performance monitor Xolisa Vitsha claimed that this situation is “in contravention of the Public Financial Management Act, with corruption and inefficiency already seriously compromising the depot’s ability to distribute drugs to public health facilities in the province. He said that the onus was on the national department to ensure that the province’s pharmaceutical depots were provided with the capacity to ensure that the national HIV/AIDS treatment will be effectively implemented in the Eastern Cape”.
Full article in East Cape News: allafrica.com...

Welfare: Road Accident Fund fraudsters fined

“Thirteen people, who are part of a large syndicate that tried to defraud the Road Accident Fund of R10, 8-million were sentenced in the Durban regional court to fines ranging from R12 000 to R30 000. Former Phoenix police officer Nernon Basil Arumgga, with Kumaran Chetty and Faeze Bemath, allegedly acted as doctors, police officers and, in some instances touts, encouraging other people to get involved. Chetty and Bermath then filled in details of their alleged injuries and accidents. They even went to a church congregation where Arumgga’s father is a priest and got other people involved in the scam. Some of these people made claims for accidents that haven’t even happened. Others made claims in accidents where they suffered scrapes and bruises. Since April last year, 75 people have been arrested, but police Superintendent Vishnu Naidoo said this number was just the tip of the iceberg. Further arrests are imminent”.
Full article in Saturday Star: www.iol.co.za...

CRIME AND JUSTICE

Police: Call for cop scam probe to be external

The Western Cape Premier has been requested by the DA to refer an internal probe into alleged police corruption to the Scorpions, making it an external affair, in order to protect whistleblowers and inspire confidence that their evidence will not be used against them by their senior officers. The probe deals with “two captains, one a women, and a senior civilian employee, based at a Cape Town regional police office, who are facing charges of corruption, fraud, misconduct and nepotism and are currently appearing at a police disciplinary hearing. More senior officers and staffers are to be charged soon. The meticulous probe, which dates back to 2000, is focussing on allegations that senior officers and key civilian employees arranged jobs for relatives. Another aspect deals with claims that senior police officers allegedly enticed recruits over several years into signing forms to join an insurance company as a prerequisite to joining the police. The officers, allegedly working as agents for the company, would then receive huge kickbacks from the insurance firm. The investigation could affect thousands of Western Cape police members and civilian employees”.
Full article in Cape Argus(September 10 2003) ...

Police: Job seekers cry nepotism

Monica Mzondi of Mfuleni in Kuilsriver is taking legal action against the police after being handed a R20 note, and asked to leave after her job had been approved in January 2003. She claims that while in the building she heard a superintendent’s sister-in-law was appointed in her place. “The Cape Argus also heard an allegation that a civilian woman had spoken to a Cape Town police officer last year regarding a job for her daughter. The young woman from Pretoria started at the Woodstock police station without being interviewed. Another allegation was that four people living in a single road in Portland, Mitchell’s Plain are all employed at the Mitchell’s Plain police station and are relatives of police members.
Full article in Cape Argus (September 10 2003) ...

Police: Cops work lands him in jail

“Inspector Makhosana Freddy Mhlanga, 37, found himself behind bars for being a good cop. In affidavits supporting his application for bail, Mhlanga reveals that while investigating the slaying of Fatima Ismail Momade, 46, her daughter Nazia, 12, and the attempted murder of Momade’s unnamed six-year-old daughter, he crossed some of his seniors. They wanted him off the case, and when he persisted, he ended up behind bars. The two women were found murdered execution-style on Lenasia Link Road in Lenasia in March this year. The youngest, who was shot in the back, survived the ordeal. Mhlanga’s team arrested 10 suspects for the incidents, and two more were still being sought. Mhlanga was arrested on June 22 on charges of corruption, robbery and intimidation – charges, which he said, were trumped up. Now with charges of robbery, corruption and intimidation hanging over him, he said in his affidavits that he had been threatened in prison by one of the same group of suspects he had helped to arrest, and he had also been told that his son would suffer the same fate as the Mozambican women. In his affidavits, he implicated several policemen whom he said had interfered with his investigations, and were also in collusion with suspects in the murder of the Momade women. At the time of his arrest, Mhlanga said he had begun the process of reporting his colleagues for obstructing his investigation.
Full article at Independent Online: www.iol.co.za...

Reform: Regulation of funding would prevent corruption and kickbacks for state contracts

The Sunday Independent reports that “ political parties have started passing around the hat as they try to raise funds for multimillion-rand media campaigns aimed at wooing voters next year, 10 year after the country’s first all-race poll”. Edwin Naidu further adds “ secrecy over the funding of political parties could become a hot potato in the run-up to the 2004 elections that also marks our 10th anniversary of democracy. Politicians are pushing for changes to the funding laws that would force parties to disclose the identities of large donors, suggesting this would prevent corruption and avoid a situation in which companies are given a government contract should the party backed by donors get into power. Current laws allow parties to solicit funds without revealing where they come from”.
Full article in The Sunday Independent (August 31 2003) ...

Reform: Bill to clean tender processes

“Companies and businessmen found guilty of corruption in government tender processes are now almost certain to be barred from bidding for government contracts for the minimum of five years. The blacklisting is set to become part of the Prevention of Corruption Bill, which is at present before Parliament’s justice committee. The committee ordered that clauses providing for such a penalty be included in the bill after seeking legal opinion on the matter. Committee chairman Johnny de Lange said the opinion from the state law advisers was a very good one and it said that it would be in order to establish a blacklist for the four offences related to tendering that were in the bill. De Lange also said that it was the intention to include, where a company was listed, and the names of the individuals at the company who were involved. This was so that they could not start another company and secure government contracts”.
Full article at Allafrica.com: allafrica.com...

Reform: Gauteng investigates corrupt cops

The Gauteng safety and liaison department is investigating more than 736 cases of corruption involving members of the SA Police Service. The investigations were previously handled by the now disbanded anti-corruption unit. They were now being dealt with by the organised crime unit through an integrated and holistic approach. The skills of the anti-corruption unit members are preserved within the organised crime units. Crime intelligence members are also involved in the activities of the organised crime unit. For the period April to June, 66 suspects had been arrested for alleged corruption. This included both members of the SAPS and civilians who allegedly bribed them. The department through its monitoring and evaluation directorate had prioritised cases of corruption received from members of the public and were sending them to the provincial commissioner for quick intervention and further investigation”.
Full article in (Sapa) ...

Research: Poverty getting Worse, says Survey

“Poverty in South Africa is steadily getting worse, says the Institute of Race Relations in the latest edition of its annual South Africa Survey. The Survey quotes Global Insight, an organisation that compiles poverty index ratings, as saying that the poverty rate in South Africa rose from 41 percent in 1996 to 49 percent in 2001.” Corruption has further bedevilled attempts to tackle poverty, the survey notes that “In February 2002 a number of government departments agreed on an integrated approach to poverty alleviation. Ten months later in November 2002, the Treasury asked the department of social development to explain allegations of corruption and fraud after the closure of hundreds of poverty relief projects in Gauteng and failure to spend millions of rands earmarked for poverty relief projects in 2002/03”.
Full article in News24: www.news24.com...

Research: Organised crime boom in SA since 1994 – UN

The United Nations Regional Office for Drugs and Crime in Southern Africa released its report, which indicates “ organised crime has undergone an explosive increase in South Africa since 1994. Due to its special geo-political position and economic opportunities, South Africa is the regional hub for organised crime, including drug trafficking. The increase in organised crime activities in South Africa has been accentuated since 1994 by the ending of its international isolation, its much freer and larger international trade and commerce, and its well developed financial, communication and transportation systems. Corruption in both the official and private sectors is also perceived to have increased since 1994. Business leaders are considered corrupt by more than half of those surveyed in the region. New patterns of organised crime, drug trafficking and terrorist financing has taken place the issue of money laundering firmly on the agenda of a number of key SADC states. Throughout the region, there is an absolute lack of legislation and law enforcement capacity to deal with these problems. Rob Boone, head of the UN’s regional office for crime and drugs, noted that only about half of the 11 countries included in the report had anti-crime strategies. He also referred to poor data collection and analysis.
Full article in the Dispatch: www.dispatch.co.za...

The OECD Anti-Bribery Convention

This month we have chosen not to profile an institution or an organisation, rather we will focus on international anti-corruption instrument: The OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (also known as the OECD anti-bribery convention) entered into force on 15 February 1999, and according to the OECD it is argued that this signals the end of business as usual.

The Convention commits the 35 signatory countries to adopt common rules to punish companies and individuals who engage in bribery transactions. So far, 32 countries have been subjected to close monitoring to determine the adequacy of their implementing legislation . The Organisation of Economic Co-operation and Development, (OECD) consists of the thirty richest countries in the world, which control 75% of global trade. No African or South American country is a member of the OECD. Only two Asian states, Japan and South-Korea are members of this exclusive club which draws most of its membership from Europe and North America.

The Convention makes it a crime to offer, promise or give a bribe to a foreign public official in order to obtain or retain international business deals. A related text effectively puts an end to the practice according tax deductibility for bribe payments made to foreign officials.

In many instances the OECD Convention, where it has been implemented in national law sets strict punishment of up to 15 years in jail for the role of corporate agents and executives in bribe-payment. The effectiveness of this convention faces two major challenges – one is a lack of public awareness and the other is the result of the fact that few if any corporations have thus far been convicted under the act. An example is the USA which has had similar legislation for over 20 years but with lacklustre prosecution results.

Citizens, particularly those in developing countries can however help to ensure the enforcement of the law in the countries where multinationals are based. This requires them to forward details of the alleged bribe-payment to embassies of OECD member states, their staff are in turn required to forward such information to the State Prosecutor in their home countries who have a duty in law to investigate the matter. If this is matched by the necessary political will this could be a powerful instrument to terminate the rampant nature of international bribery.
To view a full copy of the Convention go to the OECD website: www.oecd.org...

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The Institute for Security Studies (ISS) is an applied policy non-profit research organisation with a focus on human security issues on the African continent.

This e-briefing is produced by the SA Anti-Corruption Strategies component which is located within the ISS Organised Crime and Corruption programme in Cape Town and funded by the Danish Development Agency (DANIDA) through the Embassy of Denmark.

Editorial Team:

Hennie van Vuuren (Senior Researcher: Anti-Corruption Strategies)
hvanvuuren@issct.co.za
Paul Arendse (Research Intern)
Pilisa Gaushe (Manager: ISS Corruption Resource Centre)

For more about ISS please visit our website at: www.issafrica.org...
To contact us, or if you should have any comments, please email: umqoled@issct.co.za or Tel: 021 4617211