Publication: Business Day Issued: Date: 2003-04-14 Reporter: Richard Young

Insider Report Missed Shaik Connection



Business Day, Letters

Date 2003-04-14


Richard Young


The Editor
Business Day


I wish to take serious exception to two articles in your newspaper, Insider's Miffed by Missing Slice of Bread (August 31 2001) and Bonile Ngqiyaza's Young "Stole" Armscor's Idea (August 30 2001) both published during the week that I gave evidence at the Public Protector's hearings into the strategic defence packages (the arms deal).

I also noticed that Dr Sibusiso Sibisi of the Council for Scientific and Industrial Research wrote a similar letter of complaint to you.

If you or your readers should wonder why I have waited this long to lodge this complaint, then it may have been noticed that I have had some other fish to fry in the interim. However, I first wrote this letter on November 25 last year.

Insider said "Yunis Shaik, one of four brothers to Chippy Shaik, government's arms procurement head, couldn't contain his irritation after hearing Young testify that irregularities in the tendering process had cost his company a supply contract" and that Shaik was heard to "remark bitterly that Young's main beef with the procurement deal was not that it was corrupt, but that `he didn't get his share'."

Insider said that "Shaik's perception mirrors the conviction of an increasingly cynical public when it comes to anything associated with the arms deal".

Your article failed to say that Yunis Shaik happens to be the representative of a government-affiliated organisation that owns shares in Nkobi Holdings, which owns shares in African Defence Systems (ADS). Or that ADS was the company with which the joint investigation team found that Chippy Shaik had a material conflict of interest in the granting of a R2,6bn (now about R4,5bn) corvette combat suite supply contract without any competition and at a price tag about R700m (now about R1,1bn) more than the cabinet-approved price ceiling.

Neither Yunis Shaik nor Insider bothered to tell your readers that my company's information management system was formally nominated and specified by the SA Navy in the tender baseline for the corvette combat suite, nor that the company whose system replaced the system happened to be a sister company of ADS and a member company of the French Thomson-CSF Group; nor that Thomson-CSF SA is partly owned by Shaik brother Schabir.

Events have now even progressed further the Scorpions have issued a warrant of arrest for Alain Thetard, the CEO of Thomson-CSF SA and director of ADS, for allegedly offering a bribe to "Mr X" of "R500 000 per year, until dividends are paid" for "protection and permanent support of Thomson".

Regarding Insider's "experience" about me not getting "my share" and this being the main basis ("main beef") of my allegations of tender irregularities, I think it relevant to point out that our company recently received multiple orders for our Fibre Distributed Data Interface (FDDI) products from Raytheon Systems for use in the Ship Self-Defense System, SSDS mark II, one of the US Navy's latest surface ship combat suites. In some bizarre twist of logic, Chippy Shaik and ADS somehow deemed our information management system, based on precisely the same FDDI products, to be worthy of a 120% risk premium, thereby causing the SA Navy to discard at the final hour our system in favour of Thomson's.

The US Navy uses our SA-designed and SA-manufactured FDDI products for four of its biggest new programmes SSDS Mk II; Cooperative Engagement Capability; RAM guided missile launch system and the newest San Antonio class of assault ship. All the while, our navy must rely for its combat suites on point-to-point serial technology emanating from the 1960s and 70s.

Two of the golden rules of journalism are balanced reporting and giving the other party an opportunity to offer their point of view Insider failed to do either and further hid behind a pseudonym to publish his disparaging remarks.

This is not what one expects of a supposedly upmarket newspaper.

In Ngqiyaza's article, he writes that "a CI Systems executive has taken technology developed under the auspices of government armaments agency Armscor and tried to sell it off as his own" as being the assertion made by the legal representative for ADS.

Stealing is a criminal offence, even when involving intellectual property. As I understand it, passing off of others' ideas as one's own falls into the same category.

I have already instituted a defamation action against ADS and its CEO for their false and unfounded allegations made against me arising out of the Public Protector's hearings into the arms deal.

However, I can assure you and your readers that I stole nothing from Armscor or ADS. Firstly, the FDDI network technology which I proposed in 1989 for the SA Navy's new generation of naval combat suites is a commercial off-the-shelf technology developed by the American National Standards Institute.

Some time later we realised that the US Navy had also decided to use the same technology for all its new combat vessels. It specified the use of FDDI for the US Navy by way of a public domain document called the Survivable Adaptable Fibre Optic Embedded Network (Safenet) specification (MIL-STD-2204A).

Armscor and the SA Navy evaluated the usability and performance of the FDDI technology, as well as its commercial availability, during 1990 and 1991 as part of a technology development programme for the proposed new frigates. The work was performed by UEC Projects, ADS' s predecessor in name. The SA Navy cancelled that programme in early 1991.

Over two years later and a good while (nine months) after I established my company in early 1992 and nearly a year after I had resigned from UEC Projects (largely as a result of the cancellation of the frigate programme and another major naval programme), Armscor approached me to assist it with continuing the investigation of the use of FDDI as part of its naval technology development programme.

This was only after Armscor had approached UEC Projects to solicit its involvement, but had had no response. Armscor went so far as to formally order the transfer of all its hardware and software assets from UEC Projects to my company, to revive the project. We still have the relevant delivery notes and Armscor asset registers.

Thereafter, using about R25m of SA Navy technology development and retention funds as well as about R10m of our own funds and over a period of some six years, I, assisted by a team of half-a-dozen engineers in my company, developed a Safenet-compliant combat suite network using entirely commercial off-the-shelf components. I called this system the Information Management System.

Any accusation or insinuation, by anyone, that what I did constitutes stealing, is defamatory and will be dealt with appropriately.

I can further assure ADS, Business Day and anyone else that I earned a doctorate of philosophy in engineering at the University of the Witwatersrand (for which I registered in mid-1993) for research in real-time protocol engineering and not for developing either the FDDI technology, nor writing the Safenet specification, nor even for developing the information management system.

ADS's legal representatives may consider themselves to be protected by qualified privilege in their ill-researched and ill-considered utterings during the Public Protector's hearings, but those who originate or propagate statements containing such drivel are not.


Richard Young PrEng, PhD
MD CCII Systems 

CCII Systems (Pty) Ltd
Street Address :  Unit 3 Rosmead Place, 67 Rosmead Avenue, Kenilworth, 7708, Cape Town, South Africa
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With acknowledgements to Richard Young and Business Day.