Publication: Business Day Date: 2005-08-08 Reporter: Phyllis Atkinson Reporter: Reporter:

The Fickle French Connection

 

Publication 

Business Day
Date

2005-08-08

Reporter

Phyllis Atkinson

Web Link

www.bday.co.za
 

The Role of Thomson-CSF

If Alain Thetard, the local director of the Thomson-CSF South African companies, had stood trial with Schabir Shaik, or indeed if he were to be a co-accused in the pending prosecution of Jacob Zuma, or persuaded to give evidence, would this have affected the outcome of the Shaik trial and, if so, how?

If the assistance of the French authorities had been successfully secured, to what extent would this have changed the course of SA’s legal and political history? Would Thetard’s evidence have influenced Judge Hilary Squires’ findings in relation to Zuma’s involvement in a “generally corrupt relationship” with Shaik, or possibly persuaded the national director of public prosecutions not to press charges against the former deputy president?

If Thetard had been one of the accused, which, according to Judge Squires, “he would have been had he not left the country and refused to attend”, one may well ask to what extent this would have affected the course of the proceedings and possibly even the ultimate findings on count three.

Although we are not privy to information regarding the role the French authorities may have played in Thetard’s absence from the criminal proceedings, this aspect of the Shaik trial, and of Zuma’s pending prosecution, must surely remain a concern for the French authorities, especially in the face of increasing international pressure for countries to co-operate in transnational criminal investigations and prosecutions.

The fight against transnational crime is a major challenge facing every country. Such crime covers a broad range of criminal activity and includes terrorist funding, corruption of foreign public officials by transnational corporations, corporate fraud and money laundering. Effective international, regional and national responses are needed to ensure criminals have no place to hide and no way to enjoy their ill-gotten gains.

Effective co-operation between states by way of mutual legal assistance is an essential component of such investigations. As technological developments facilitate the ease with which one is able to make transnational transactions and cross borders, and the internet and electronic funds transfers are accepted features of modern business, the assistance of foreign states is vital if the proceeds of crime held anywhere in the world are to be traced and confiscated. Securing evidence abroad often provides the key to success in a complex commercial investigation and bringing those involved in organised crime to book.

With good reason, much has been made of the corruption trial that led to Shaik’s conviction and President Thabo Mbeki’s watershed decision to relieve former deputy president Zuma of his duties. The role played by Thint, formerly known as Thomson-CSF, the French arms company, is deserving of attention. Given Squires’ findings in relation to the participation of Thetard in the agreement with Shaik ­ whereby Thomson-CSF would pay Zuma R500 000 a year to secure benefits ­ the multijurisdictional nature of the investigation and prosecution posed challenging questions, many of which went partially unanswered.

Will the prosecuting team resume its attempts to secure the co-operation of the French authorities in the Zuma trial, and if so, is it likely to succeed?

The state charged that Shaik had allegedly agreed with Thetard that in return for the payment by Thomson to Zuma of R500 000 a year until another sustainable source of revenue became available in the form of dividends, Zuma would shield Thomson from the commission of inquiry appointed to investigate allegations of irregularities in the arms deal, and thereafter promote Thomson’s business interests in SA.

As stated by Squires: “But the most important aspects of Thomson’s activities in SA in this trial were, first, the part it played in the bidding process for the new navy corvettes and its eventual accommodation of Nkobi’s interests in the benefit of such bid; and, secondly, its alleged attempt with Shaik thereafter to buy Zuma’s protection from any public investigation of the arms deal and his protection of Thomson’s interests in the future, which is the subject of count three.”

The evidence of the main charge on count three was the handwritten draft with the infamous encrypted fax written by Thetard at a time he and Shaik were both directors of Thomson-CSF. This document was accepted in evidence as a declaration by Thetard, as a co-conspirator with Shaik, regarding the arrangement to offer a payment to Zuma for using his authority to protect and promote the interests of the Thomson-CSF companies, and Zuma’s acceptance of this.

The court relied on this evidence as being an executive declaration in the carrying out of an unlawful conspiracy. Despite Thetard not being a co-accused or giving evidence, the executive statement was one of the accepted vicarious liability statements which are received as an exception to the hearsay rule, where the charge is brought against a co-conspirator or in support of a conspiracy.

The court rejected as false Shaik’s explanation that the agreement described in the fax was for a donation.

Squires was particularly vociferous in his reference to Thetard, describing him “… as both a fool and a rogue in being party to it and not destroying any of the evidence. If it was just a donation that he was writing about, it is surprising he was not prepared to say so even in one of his conflicting affidavits.”

Thint was an accused in the proceedings, but charges were withdrawn before a plea was made and the start of the evidence against Shaik and his companies.

Mutual legal assistance allows for a country to approach another for assistance in a criminal investigation of the nature described above. Such a request may entail asking for assistance in the examination of witnesses who cannot or will not return to give evidence. A mutual legal assistance regime is clearly invaluable and essential in investigating cases of transnational crime and emphasises the need for an international response to an international problem.

SA’s government clearly acknowledges the scourge of corruption, a fact emphasised by the Shaik trial and surrounding circumstances, and that its effects can constrain the development of national economies and prevent good governance. It recognises that corruption erodes stability and trust, damages the ethos of democratic governments, and results in immense macroeconomic and social costs.

As stated by Squires, “the reason for punishing corruption in the private sector is that it subverts the principle of lawful competition and free enterprise because the corruptor may be offering the bribe to obtain preferment over some competitor whose product or services is actually better than the offeror, but who cannot or will not resort to bribery. And in the public sector it is punished because society has an interest in the transparency and integrity of public administration.”

Atkinson is associate director, Deloitte Forensic & Dispute Services, Cape Town.

With acknowledgements to Phyllis Atkinson and the Business Day.

And there we have it :