Sat, Jun 04, 2005 - Page 6 News List

South African guilty of bribing deputy president over arms

NY TIMES NEWS SERVICE , JOHANNESBURG

A Durban businessman with close ties to the governing African National Congress was found guilty on Thursday of paying US$186,000 in bribes to the deputy president, Jacob Zuma, South Africa's second in command and heir apparent, in some eyes, to President Thabo Mbeki.

The verdict brought demands from the ANC's critics for Zuma to resign or to abandon any quest for the presidency when Mbeki leaves office in 2007.

But it remained unclear whether government prosecutors even intended to press charges against Zuma for what the trial judge called "overwhelming" evidence of corruption.

A Durban High Court judge found the businessman, Schabir Shaik, guilty of two counts of corruption and one of fraud, all involving payments to Zuma from 1995 to 2002.

The centerpiece was Shaik's role as a middleman between Zuma and the French arms company Thomson-CSF, which agreed to pay Zuma about US$150,000 while it sought a US$69 million contract to supply ships to the South African navy. Both Thomson and Shaik's company, Nkobi Holdings Proprietary Ltd, were shareholders in a group that won the contract.

Shaik argued that the payments were donations to an educational charity that Zuma had established in KwaZulu-Natal but the judge, Hillary Squires, dismissed that explanation as "ridiculous."

In his ruling, Squires said the evidence, including an encrypted fax in Thomson files and coded letters between Shaik and Zuma, established beyond a doubt that the payments were bribes.

Other evidence, outlined in a 259-page forensic audit, indicated that Shaik's company had sought government help on projects like a Durban hotel and a Malaysian arms deal, and that Shaik had paid for everything from service on Zuma's Mercedes to Armani suits.

During the period in which the payments were made, Zuma served first as the ANC's national chairman and then as Mbeki's appointed deputy president. For much of that time, the audit contended, Zuma was in dire financial straits. On occasion, Shaik's company also ran up large debts to continue the payments.

Although Thursday's verdict affects only Shaik, Squires made it clear that Zuma was compliant in an arrangement that allowed him to "maintain a lifestyle beyond what he could afford."

Squires' verdict sets up a test of South Africa's commitment to the rule of law and the independence of its legal institutions.

The inquiry into the arms deal at the root of Shaik's troubles has already led to the arrest of an ANC legislator who headed parliament's defense committee, and the resignation of a government arms buyer -- Shaik's brother Chippy -- accused of a conflict of interest.

But the much-acclaimed National Prosecuting Authority that made the case against Shaik, nicknamed the Scorpions, has suffered withering political attacks that culminated in the resignation last year of its director and raised questions about its continued existence as an independent arm of government.

The agency declined to say whether prosecutors would now pursue a corruption case against Zuma. "If there is anything to be done about it," said a spokesman, Makhosini Nkosi, "it will be done."

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