Almighty Power of The Cover-Up |
Publication |
Business Day |
Date | 2008-12-01 |
Reporter |
Tim Cohen |
Web Link |
The Scorpions, with admirable pluck *1,
have ignored their imminent demise and are continuing to conduct search and
seizure operations as part of their investigation of the arms deal. Good for
them, but it’s hard not to notice how little everyone seems to care.
Previous Scorpions raids were the stuff of
legend that shook South African politics to the core. But
the Scorpions raids over the past week of British arms company BAE Systems,
former ministerial adviser Fana Hlongwane and John Bredenkamp barely made it to
the front pages.
South Africans have apparently got tired of this issue, and have long ago made
up their minds about it. These raids seem like so many before them. But, from
covering the extraordinary story of the arms deal for the best part of a decade,
I suspect investigators are only now
getting anywhere near to the heart of the matter.
If and when they do, I suspect several things will become apparent.
First, it will become obvious that African National Congress president
Jacob Zuma’s role in the whole affair was really
trivial *2. The fact that Zuma’s name is now deeply
associated with arms deal corruption is a huge irony, and I suspect it is no
accident. I think the investigations of Zuma were a convenient red herring for
all the people much more intimately involved. This is one of the reasons for
Zuma’s and his supporters’ anger. But it’s also something he cannot express. He
can’t fume publicly about the fact that other people were more corrupt than he
was (assuming they were and he was).
Second, as the investigation progresses, it will probably become clear that the
most egregious acts of corruption involved not the French or German parts of the
deal, but the British part. This is also an irony. The French defence companies
have received the most and the worst press, but actually they and the
French authorities were comparatively honourable
about it all *3. This is partly, you suspect, why they
were beaten into the role of subcontractors.
From the start, the aircraft contracts were the most suspicious part of the
deal. And the British part of the aircraft contracts were most questionable for
the simple reason that the selection criteria was so obviously jigged and the
British contribution of training aircraft was the least necessary, considering
SA had plenty of Cheetahs for that purpose at the time. SA’s navy was obviously
in need of attention, and a capacity to patrol South African waters is a clear
defence requirement. But the British seemed excluded from the deal, since the
Germans were supplying the naval vessels, and the Swedes the jets.
The British Hawk trainers were twice the cost of the Italian Aermacchi MB339 and
were only favoured when the defence minister at the time, Joe Modise, who was
being advised by Hlongwane, opted for a “non-costed” option, which allegedly
focused on the military value and counter-trade deal offered by British
Aerospace. This was already apparent at the time of the auditor-general’s report
on the arms deal in 2001.
The third and last of my predictions is that if this investigation goes anywhere
(and I suspect it won’t) it will demonstrate former president Thabo Mbeki’s
intimate involvement in the whole sordid affair. Mbeki has been the
eminence grise *4 in
the arms deal from the start, yet his culpability has never been brought to
light.
It tends to be forgotten that it was Mbeki who was responsible for
proposing, motivating, organising and selecting
the ultimate winners of the contracts as deputy president
and then as president. But our chess-playing former president apparently helped
make sure that others were around to take the fall when things started to go
wrong.
Why is the British role in allegations of corruption only coming out now, eight
years after the event? I suspect it’s partly because the level of corruption was
so high, and therefore so much was at stake. The numbers mentioned in the Sunday
press tell their own tale; no longer are we looking at a mere R500 000 per year.
Suddenly we are looking at £1m a year, and a settlement figure for Hlongwane of
$8m.
The big question is why this investigation is making any progress at all, since
British prime minister Tony Blair famously quashed the investigation of the BAE
Systems huge bribes involved in the $85bn Al Yamamah arms deal with Saudi
Arabia, the company’s largest deal. The short answer is that BAE’s contracts
with the US military are now threatened, and in order to settle that dispute,
everything else is child’s play.
The US military awards contracts worth
tens and hundreds of millions of dollars each month to BAE *5.
But if they are convicted of fraud in the US, these contracts
would be barred. And the reason they may is because of this very same Al Yamamah
deal, since it became apparent that the prime beneficiary of BAE’s alleged $2bn
bribe, Prince Bandar bin Sultan bin Abdul Aziz Al Saud, kept some of the money
in the US at Riggs Bank, opening the way for US involvement.
The US justice department then slapped a subpoena into the hands of then BAE CEO
Michael Turner at Houston airport. According to one legal analysis,
the smack of the subpoena hitting Turner’s hands
was heard around the world.
So BAE is now trying to clean house, and has apparently stopped stonewalling the
UK’s Serious Fraud Office, which, in turn, has started to investigate the South
African deal, asking the Scorpions for assistance. And this new-found enthusiasm
to at least try to control the most egregious forms of corruption is what
ultimately led to the raids in SA during the week.
Will any of this ultimately come to court?
*6 Frankly, I doubt it. Arms dealers know that politicians
have the power and the desire to cover up their own indiscretions, and in the
process cover up theirs too.
As a state without a written constitution and a rather tired, worldly view of
this stuff, the British have more ability than most. US authorities brought 103
foreign bribery cases this year, Germany 43, France 19 all doubling or
quadrupling the number they brought last year.
This year, the British brought zero, zero more than they brought last year.
With acknowledgements to Tim Cohen and Business Day.