Zuma Still Paid as Nkobi Ran Dry
'Payments endangered the business'
Schabir Shaik and his companies were "stretched to their limits" with an overdraft of more than R500 000 in August 1999.
The group's financial manager pleaded with him twice to cut costs, look at legal fees, cars, travel and salaries, and "watch expenses for the ANC".
And yet, says forensic auditor Johan van der Walt, Shaik and his companies were still making payments to and on behalf of Deputy President Jacob Zuma.
In August that year, these amounted to more than R600 000, he told Durban High Court judge Hilary Squires yesterday.
The State claims Shaik paid Zuma R1,2 million in what the State claims was a generally corrupt relationship between them.
Shaik is also accused of securing a bribe for Zuma from arms bidder Thomson-CSF and is charged with fraud relating to the writing off of R1.2m in his books, part of which was used to make payments to Zuma.
Dealing with the cash flows of Shaik's Nkobi group of companies through "factual information" from bankers Absa, Van der Walt said they had been in overdraft between 1999 and 2001.
"The general decline in the net cash resources has a direct correlation with the amounts we identified as having been paid for and on behalf of Zuma," he said.
"The payments had a fundamental effect on the business. As the cash balances decreased, so the payments increased.
"If it were not for these payments, or if Zuma had repaid them, then the group would have remained cash positive.
"The group did not have sufficient funds to provide these loans without the overdrafts and they endangered the very existence of the businesses."
Dealing with documents which he said were internal memoranda and correspondence with the bank, Van der Walt said:
In March 1999, Nkobi's overdraft was more than R352 000. At that time, it had made payments to Zuma of almost R485 000.
In May 1999, the overdraft limit was increased by the bank from R275 000 to R450 000. The actual overdraft was just over R384 000.
The payments to Zuma by then amounted to R528 000.
In June that year, group financial manager Marcia Muiznieks told Shaik that they had a "cashflow crisis". They owed R776 000 to the taxman, R676 000 to sundry creditors and only had R323 785 available in overdraft.
And yet the payments to Zuma had reached a cumulative total of R534 000.
In August, when the company faced an overdraft of R441 000 and was "stretched to its limits",
Muiznieks had written to Shaik again, imploring him to cut costs. By then, the payments to Zuma were over R600 000.
Van der Walt will testify this morning that by May 2001, Nkobi had an overdraft of over R1m - well over an authorised limit of R750 000.
Absa instructed Nkobi to "rectify the position within seven days" and instructed that no further cheques be issued. By this time, Zuma had been paid over R1m.
Shaik has admitted making most of these payments, but claims they were done out of friendship with Zuma and as contributions to the ANC.
With acknowledgements to Tanya Broughton and the Cape Argus.