Gripen inquiry reopened in SA?

subscriber | 24 March, 2008

JOHANNESBURG. The National Prosecution Agency in South Africa, threatened by closure seemingly for its investigations into ANC leaders, has reopened an inquiry into the dealings of deceased former defense minister Joe Modise and his entourage, claims Johannesburg investigative newspaper Mail & Guardian.

The newspaper pointed out Mr. Modise’s advisor and confidant Fana Hlongwane last year as a possible suspect and under investigation by the British Serious Frauds Office (SFO).

Mr. Hlongwane allegedly received $ 8 million in commissions between 2001 and 2005 for consultancy work related to the Gripen sale. Other persons mentioned as reciepients of commissions for the BAE-Saab deal with South Africa are deceased BAE agent Richard Charter, South African industrialist Basil Hersov and British-Zimbabwan arms dealer John Breedenkamp.

The British investigation has, however, been hampered by lack of co-operation by its South African counterparts.

Serious Frauds Office’s Stockholm counter part, State Prosecutor Christer van der Kwast, has done pre-investigations of the matter but hasn’t found any reason to launch a full inquiry.

There would be limited political support in Sweden for such an inquiry.

The NPA in South Africa hasn’t stated if it has re-opened the inquiry. The likelihood that it happens is limited but not unlikely as the NPA has become a political battleground.

The Zuma faction within the ANC, now firmly in the drivers seat, wants to close down NPA as an independent unit and merge it with the SA Police.

This is widely, among political analysts and commentators, seen as a way of stopping investigations of ANC politicians. If NPA indeed is investigating Modise it could be a way for the unit to show more interest in investigating politicians identified as Mbekiites.

Its been pointed out for some time by commentators that the alleged corrupt practices by ANC president Zuma, a possible ZAR 500 000 bribe by French Thales, and about ZAR 1.6 million in “loans” from his now jailed former advisor, is miniscule compared with the alleged bribes paid to South African politicians and their moles during (and after) the 1999 arms deal.

The sale of 28 Swedish manufactured Gripen jet fighters was the largest component in that deal.

Saab will not comment on details around commissions paid, referring to the ongoing investigation of BAe Systems, which was in charge of the marketing side of the Gripen deal and therefore handled these payments.

Mail & Guardian also claims that Zuma supporters are trying to build a case against president Mbeki in relation to the German export of frigates and submarines in order to pressure for a general amnesty for everyone who've dipped into the arms deal.

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Saab is conveniently apportioning blame to its former marketing partner BAE Systems. It is feasible, but not credible, that Saab knows nothing about commissions paid by BAE Systems to individuals via accounts in far-flung offshore islands. If large payments have been made to consultants Saab may have circumvented normal corporate governance rules by not having internal controls in place that can explain what kind of work individuals have done.

If a consultant does substantial marketing work for Gripen, to the tune of SEK 60 million over five years, one would assume that the company would need to liase with its partner BAE Systems about the amount and quality of work that the consultant in question have put in.

This, we believe, is the exact point where numbers, events and explanations do not add up and the matter should be further investigated also by the Swedish prosecutor - as Saab's corporate head office is in Sweden and possible fiddling with money affects shareholders.

In-action from Christer van der Kwast would make it look like he is cowardly passing the buck. South Africa's purchase of Gripen was the largest component in South Africa's controversial international arms purchase.

Still Sweden has done far less than other involved countries to bring all information above board.