One could probably dub Andrew Feinstein – the feisty former African National Congress MP – as the Mr World-Fighter-Against-Arms-Deal-Corruption. He is full of hope that South Africans will see a lot of top executives of big business, arms peddlers and the banks in jail alongside the deeply corrupt in the political elite. But he admits he harbours concerns that President Cyril Ramaphosa may not have the gumption to put former President Jacob Zuma behind bars.
By Donwald Pressly*
Andrew Feinstein, who has for a decade been based in London at Corruption Watch UK, makes no bones about it that the world’s key arms peddlers were seen en masse at Codesa – the body that negotiated the settlement for the New South Africa. The arms deal, which had been planned by the apartheid government but was disrupted by apartheid reforms and the political non-racial settlement, was to prove the trough from which to dispense political patronage in the new ruling party, the African National Congress. “We spent R70bn on weapons we did not need… many of which we have massively under-utilised to this day. This (the arms deal) was the first instance of state capture (in the democratic era).” Feinstein says he was shocked how far the then President, Thabo Mbeki, was prepared to go to “stop a meaningful investigation of the deal” and to “effectively neuter the Standing Committee on Public Accounts”. He shut down the Heath special investigation unit into the deal. Of course the reason was that a substantial slice of the arms deal companies’ profits were channelled to the ruling party. “The bribes on the deals (to provide ships to the navy and aircraft to the SAAF) would be a great way to dispense personal patronage within the ANC but also arms deals are an extremely good way to finance a (political) party.”
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Addressing the Cape Town Press Club, Feinstein, who served during the Mbeki era in parliament, joked that when he raised the matter of R500,000 – just ÂŁ27,000 – being paid to then Deputy President Jacob Zuma by arms peddler Thales (then Thomson CSF), Zuma had clandestinely invited him to his office and encouraged him to continue to probe the arms deal. “Zuma would call me to his office… (and said) you have got to press on (with the probe). It is your constitutional responsibility.” Feinstein admitted, as a young parliamentary backbencher to being a wee bit naĂŻve. “I thought he (Zuma) was a constitutionalist.” But what he did not know was that the bribe had not yet been paid. So when he heard Thales had finally paid the bribe, he soon realised that Zuma’s keenness for a probe quickly dissipated.
One jumps to the present. Feinstein is asked if it was worthwhile tackling Zuma over the arms deal when there were bigger fish to fry, so to speak, in the state capture inquiry also known as the Gupta affair. Why not, instead, prosecute Mbeki – who knew about the arms deal shenanigans all along? Feinstein said Mbeki “didn’t take any money… I would argue he knew about the money that benefited the ANC. Feinstein said this would be a “very difficult prosecution.” He added: “I don’t think Thabo Mbeki covered himself in glory when dealing with corruption within the ANC, within the state. I was shocked that somebody that had dedicated his entire life to bring about democracy… was prepared to undermine the very institutions of democracy … to protect the party.”
However, it would be far easier to prosecute Zuma in relation to the arms deal. Schabir Shaik, Zuma’s financial advisor, one must recall had been “sentenced to 15 years for corrupting Jacob Zuma.” Zuma had ensured that Shaik was released from prison. An arrest of Zuma would send the right message “and I think it would embolden our current president… and the way he deals with the current (ANC) party. The country needs a win like that. Once there was an arrest for arms deal corruption the case against Zuma for state capture would be easier. “What a trial will show is that the (former) president is not above the law.”
Feinstein jokes that when Zuma heard he was getting the cheque from Thales, “suddenly he was not so keen on our investigation anymore.” Since then Zuma had avoided his day in court, but if he appeared in court in May, it would not be for what is now known as state capture but for that money that Thales paid him. “It is my contention that Zuma has become the first and ultimate betrayer of the people of a democratic South Africa,” said Feinstein.
It was time to see some big guys being dressed in orange but Feinstein said there was a lurking danger that the ANC would not allow ‘show trials’ – or high-profile arrests – to happen. There was a tradition in the ANC to protect those who had transgressed. For example, former ANC chief whip Tony Yengeni – who got a 4×4 Mercedes from an arms deal company – went from prison to become the ANC’s head of political education. Some 209 people are set to give testimony against Zuma when the trial gets underway, but Feinstein adds the cryptic words “unless the ANC decides something different should happen.” Blocking the Zuma trial may come from the top, Feinstein fears. “I spent a lot of time in the ANC from the mid-1980s both formally and informally. I do fear that the organisation has a tradition of looking after its own… For Jacob Zuma still to live as he does seems to me to be an absurdity. I do fear… that the president (Ramaphosa) might feel that it may create such ructions and tensions within the party that he would try to intervene to ensure that Zuma does not face prosecution. I hope that I am completely wrong.” Feinstein asked himself the rhetorical question: “Is that a possibility? Unfortunately I think it is.”
What about big shots like Ace Magashule – whose arms appear to be deeply embroiled in the Estina dairy farm debacle? Why is he not being nailed? Feinstein is emphatic: “He is ultimately responsible for Estina. The only reason that nothing is happening is because he is politically protected… people are very scared to go after him because he is general secretary of the ruling party. His period of office in the Free State (as premier) was characterised by such profound and systemic corruption that he should be one of the first people after Jacob Zuma to face prosecution in relation to state capture. I think he will be. On Estina, he was ultimately responsible from the government side that Estina happened. The Free State government effectively threw away half a billion rand of its citizens’ money.” One should live in expectation if he does not stand trial, the people of the Free State and the people of the country “should demand to know why”. Only seven percent of the money earmarked for Estina went to the project while 64% of it went to Dubai “to a variety of companies controlled by the Guptas.” This deal was smoothed by FNB, which transferred R85m to a Gupta-linked company in Dubai, and Standard Bank, which also transferred monies to Dubai.
Feinstein said the people of South Africa – battered by allegations of rampant corruption – should never underestimate the power of media focus and public protest. South Africans had already witnessed the success of these campaigns. The nuclear deal with Russia was stopped in its tracks after the investigations put pressure on the ruling ANC “and started creating confusion (within) the ANC and the government.” Ultimately, the nuclear deal did not go through.
Feinstein says he would like to see CEOs of arms companies and banks – including the Bank of Baroda, Nedbank, First National Bank, Standard Bank, HSBC, PWC, KPMG, Deloitte, Bain and company – fall for their part in smoothing the money flows for the Guptas. He refers to the work of the Open Secrets organisation. He had great faith in the National Prosecuting Authority and the Zondo commission. “The leadership of both those entities is extremely impressive. I believe the intention of the leadership of both of those organisations is to see appropriate people in this country face prosecution for the theft from the people of this country.”
Feinstein said bankers, accountants, management consultants and law firms had helped to not only design the “corrupt schemes of state capture in this country” but had carried out illegal flows of capital and massive money laundering. This included the establishment “of a dizzying array of front companies by the Guptas and their associates”.
He said the heads of these institutions had lost the right to good manners. He said Bain and Company could be thanked for the state of the SA Revenue Service “because they made tens of millions (of rands) helping (then SARS commissioner) Tom Moyane to destroy SARS’ capacity to collect revenue.” The companies that smoothed state capture should be fined massive amounts of money, debarred from even being allowed to apply for government contracts” – at least for periods of time that reflected their various roles in the capture enterprise. Feinstein, in response to anti-arms deal campaigner Terry Crawford-Browne, said it would be very difficult to get the arms deal money back. Some arms deal companies were known to routinely bribe – and even thought this was publicly known, the practice continued. However, he said: “Individual executives who were leading these companies at the time (of state capture), should also end up in orange overalls.” Did he fear for his life as he had offended many top politicians and businessmen? No, he had received at least one threat – and he had lost his job as an MP and also left a top job at Investec over his public campaign against arms deal corruption, but he continued regardless. “It is really not an issue.”
- Donwald Pressly is a veteran journalist and political economy analyst.
