Publication: The Star Issued: Date: 2004-10-14 Reporter: Estelle Ellis Reporter: Jeremy Gordin

The Big Showdown



The Star

Date 2004-10-14


Estelle Ellis, Jeremy Gordin

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They need no smoking gun to prove their corruption case against Durban businessman Schabir Shaik.

This was the argument of the leader of the prosecution, advocate Billy Downer SC, on day one proper of Shaik's trial at the Durban High Court yesterday.

Downer said all the prosecution needed to do was prove a mindset.

Shaik dared them to try.

He yesterday pleaded not guilty to two charges of corruption and one of fraud as well as a myriad alternative charges relating to reckless trading, failing to keep proper records, theft, tax evasion, falsifying records, money laundering and acquiring unlawful proceeds of crime.

This was the essence of the opening arguments:

Case for the prosecution

Schabir Shaik's defence as summarised from his plea explanation.

His relationship with Zuma was a friendship and nothing else.

As a friend, he tried to help Zuma out of financial trouble and keep him in politics. As Shaik's counsel Francois van Zyl read out the list of payments Shaik admitted to have made to Zuma or on Zuma's behalf, someone in the audience whispered: "He sounds just like an auctioneer." The payments were, among other things, for school fees, legal costs, car repairs and designer clothing.

Nothing about the payments was unlawful or corrupt.

No money was paid with the intention of involving Zuma in any corrupt act or to reward Zuma for doing something wrong.

He denied alternative charges of reckless trading and failing to keep proper accounting records.

He admitted that R1,2-million was "written off" in the accounting records of one of his companies, Kobifin, but said this was a mistake, and he had been informed that it would have no tax implications. He said it was later agreed to allow auditors to rectify the error.

He denied alternative charges of theft, tax evasion and falsifying accounting records.

With specific reference to corruption in the arms deal, Shaik denied any wrongdoing or soliciting a bribe for Zuma.

He also denied being party to a phantom agreement that the state claims was used to hide the payment of the bribe.

He also denied alternative charges relating to organised-crime legislation.

Case for the defense

The state's case, as presented by Downer in his opening address:

This case is, firstly, about a general corrupt relationship between Shaik and Deputy President Jacob Zuma and, secondly, about a bribe of two annual payments of R500 000 in exchange for Zuma's protection against investigations of SA's arms deal.

It doesn't matter what role Zuma played in the conclusion of the deal. Corruption can exist where people do things they are paid to do anyway.

To get a conviction, the state need only prove a corrupt intention existed.

The state intends to prove that, "apart from the formal bidding process, there was an informal (back-door) process followed where money may or may not change hands but where influence is more important than tender documents ...

"Those in power may be involved in the informal process and it may involve an exchange of money.

This is how it was done in the present case. I must stress that we deal with a perception."

The Nkobi group of companies was in financial trouble and could hardly afford the payments. They made no business sense.

Zuma's financial position was difficult as well.

The state intends to put together a puzzle of facts of money changing hands, probes into the arms deal and Zuma's money troubles to prove that all was not above-board. It will show that R2-million paid by Nelson Mandela to the Jacob Zuma Education Trust was used by Shaik to disguise the payment of bribe money to Zuma.

The state will rely on a law that allows the use of statements made by persons involved in an alleged conspiracy, even though all of them are not before court.

With acknowledgements to Estelle Ellis, Jeremy Gordin and The Star.