Saab admits bribes paid in SA arms deal

MickeyD

MickeyD

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Time for the HAWKS to re-open the case?

Stockholm - Swedish defence group Saab on Thursday admitted that millions were paid to clinch a South African contract for fighter jets but said its erstwhile British partner BAE Systems had paid the bribes.

Saab said R24m had been paid by BAE in the form of bonuses and salaries between 2003 and 2005 for the deal involving 26 JAS Gripen fighters.

The comments came after Sweden's TV4 television channel said it had evidence Saab had promised to pay Fana Hlongwane, then advisor to the South African defence minister and also serving as a consultant to the Swedish firm, millions of euros in bonuses if Pretoria did not back out of the Gripen deal.

Saab said R24m rand had been paid by its South African subsidiary Sanip, which was then controlled by BAE Systems.

Saab president and chief executive Haakan Bushke denied responsibility saying in a statement: "A person employed by BAE systems has without Saab's knowledge signed for us an unknown contract, signed for us up until now unknown transactions..."

BAE Systems said last week it had sold its stake in Saab for €170m.

The 1999 deal with South Africa provided for the sale of 28 jets for €1.6bn but this was later whittled down to 26.

The last plane is due to be delivered next year.

- SAPA
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http://www.news24.com/SouthAfrica/News/Saab-admits-bribes-paid-in-SA-arms-deal-20110616
 
A year ago Menzi Simelane called off the investigation into Fana Hlongwane due to supposed "insufficient evidence, " yet a team of foreign journalists are able to dig up the required dirt over the course of a relatively short investigation.

A quick glance of SANIP's financial statements makes for rather interesting reading too. Even though this transaction was off the books, their "ordinary" day to day business is blatant corruption.

  • A loss-making business apparently spent nearly R5m in 2003 on consultancy fees and travel. Why? Ah, seems Hlongwane was even charging exorbitant (and more than likely non-existent) consultantancy fees over and above this bribe.
  • Why on earth would this be necessary for a company that employs just 14 people and who's sole business is the arms deal transaction?
  • Why would this company require nearly R1m in motor vehicles (in 2003?)
  • Why did BAE Systems want to purchase Sanip and why did the deal fall through after nearly 4 years? And why would such a deal take that long?
  • Why was Saab trying to liquidate Sanip since 2001 already, considering their main business was to fulfill the contractual obligations required by SA in the arms deal? And why is the liquidation only being finalised now?
  • How could a company employing 14 people and generating no turnover to speak of generate nearly R16m in expenses in one year?
  • How is it that a company incurring such relatively massive expenses in 2004 suddenly generated only R30k in expenses (exactly) for 2006 and 2007?
  • Why did Saab loan millions to Sanip that was interest-free and had no maturity date? Why would this even be necessary? If you look at their balance sheet, one has to question how this company even survived.
  • And what was Ernst and Young's involvement in this all, as SANIP's auditors?


I can nitpick their financials for ages but the fact of the matter is that Sanip was used as a front for dodgy deals regardless of whether or not the bribe was accounted for on their books. And for those looking for Sanip's details, they are registered as BFG Turnfloor pty Ltd.
 
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And it's pretty clear-cut by the way - Saab have been able to prove that money left their bank account and was transferred to the Czech Republic. It then went to Hungary until it's final transfer to Hlongwane Consulting. The one question that I cannot get to the bottom of though, is who was/is the director of Sanip/BFG Turnfloor pty Ltd? It is blanked out on all the financial statements; not available on Cipro/CIPC and no mention of the director can be found on google- not even in the full letter from the CEO of Saab. I'd like to dig deeper into the connection between the director of Sanip, Fana Hlongwane and particularly, Jacob Zuma...
 
DJ... said:
<snip>the connection between the director of Sanip, Fana Hlongwane and particularly, Jacob Zuma...
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aahhhh... the crux of the matter! This is also, in my opinion, why the entire case has been "closed". I also think another name or two will pop out.
 
DJ... said:
And it's pretty clear-cut by the way - Saab have been able to prove that money left their bank account and was transferred to the Czech Republic. It then went to Hungary until it's final transfer to Hlongwane Consulting. The one question that I cannot get to the bottom of though, is who was/is the director of Sanip/BFG Turnfloor pty Ltd? It is blanked out on all the financial statements; not available on Cipro/CIPC and no mention of the director can be found on google- not even in the full letter from the CEO of Saab. I'd like to dig deeper into the connection between the director of Sanip, Fana Hlongwane and particularly, Jacob Zuma...
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So money laundering is the least of the offences, which also include corruption and tax evasion ?

It always surprised me that SARS did not pursue these cases, or maybe they are not as independent as they should be ?
 
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Jola said:
But don't they only have a handful of qualified pilots?
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That is a fact, but I have seen some of the maneuvers they do with the Hawk Mk 120, from the ground they look pretty formidable IMO. My house is like 15KM from the base, so we often get to see them fly past.
 
You get to see them fly passed? Money well spent in that case. Not sure what all the fuss is about...:p
 
Don't you realise that South Africa is the home of the one-side accounting entry.

Someone paid a bribe, but noone received the bribe. Someone has a corrupt relationship with the president, but he doesn't have a corrupt relationship with them. Millions are missing from accounts but noone took the money.
 
DJ... said:
[*]Why did Saab loan millions to Sanip that was interest-free and had no maturity date? Why would this even be necessary? If you look at their balance sheet, one has to question how this company even survived.
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Don't think any adverse inferences can be drawn from this fact. A very high percentage of companies in SA are funded this way.

Other than that, I agree with you.
 
Don't think any adverse inferences can be drawn from this fact. A very high percentage of companies in SA are funded this way.
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Agreed, however I simply cannot understand why Sanip's business would require a substantial loan to begin with. The reason the loan caught my attention is that around the same time that the bribe took place, all of a sudden the loan was paid back in full to Saab, whereas this was far from the case for all previous years. So what changed?
 
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