South Africa expected to probe arms bribery allegations

CAPE TOWN, South Africa (Reuters) -- The South African government is expected this week to give the green light to a major probe into the country's scandal-plagued multi-billion dollar arms procurement deal, a leading parliamentarian said on Tuesday.

"Parliament is likely to consent to the investigation and ask the public accounts committee to work as its agent," African National Congress parliamentarian Andrew Feinstein told Reuters.

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The committee will next week call a meeting of four leading agencies that have already begun to probe certain aspects of the 43 billion rand ($5.7 billion) deal to thrash out a coordinated plan of action.

"It will certainly be the most comprehensive investigation of its kind ever mounted here," Feinstein said.

The aim is to produce an interim report in January and complete the probe around April or May, he added.

The deal signed last December, involving arms firms in Germany, Italy, Sweden, Britain, France and South Africa, includes offset deals supposed to be worth 104 billion rand which the government said should generate 65,000 jobs.

Some of the top names in the world arms trade are involved, including Sweden's Saab, Britain's British Aerospace and France's Thomson-CSF.

But allegations of bribery and corruption have surrounded the deal, and a preliminary study by the auditor-general recently called for a forensic audit after finding serious flaws in procedures.

Gavin Woods, the head of parliament's public accounts committee, has already received an anonymous death threat and other members of the committee have been cautioned to take increased security precautions.

"There has been no pressure so far, but people are not aware of just how deep we have already gone," committee member Feinstein said. "There are definite strands."

Next week's closed-door coordinating meeting will bring together auditor-general Shauket Fakie, special investigator judge Willem Heath, public protector Selby Baqwa and the office of serious economic offences.

Initial areas of focus will be on sub-contractors in South Africa, flawed procedures, possible exercise by individuals of undue influence on the contract process and the failure of government to reveal the true costs of the deal at the time.

The investigations cannot at this stage include the foreign prime contractors for the corvettes, submarines, trainer and fighter jets and helicopters because they have no jurisdiction overseas.

But Feinstein said if it became clear during the course of the probe that foreign bank accounts or assets were involved, then the director of public prosecutions and the asset forfeiture unit would be called in.

"Their remit applies overseas as well," Feinstein said. "It is too early to tell if any heads will roll because of this. It could just turn out to be a few procedural errors or it could be major."

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