Trial Report: Nine

The report covers the period 24 January 2000 - 28 January 2000 (Monday to Thursday)

After a seven-week recess, the trial of Dr. Basson resumed in the Pretoria High Court on Monday 24 January. Forensic auditor, Hennie Bruwer, was the first witness. Bruwer is expected to give evidence in chief for at least two weeks on the 400-page report he compiled following a six-year probe into alleged financial irregularities under the aegis of Project Coast. Bruwer's report is supported by documents relating to the companies allegedly established by Basson.

Bruwer told the court that investigators recovered evidence from American lawyer David Webster's office, despite the normal client-attorney privilege rule, and notwithstanding attempts by Webster, through the American courts, to prevent them gaining access. Details of these court actions were not provided. The American courts decided in favour of the investigation team and compelled Webster to open his files. Many of the documents retrieved contain notes and instructions in Basson's handwriting, and appear to be explanatory and briefing notes to Webster during legal consultations regarding the establishment companies.

Bruwer said that he had found that many of the companies allegedly established by Basson were used solely as a conduit for the transfer of funds and had no assets. It was claimed that Basson was a shareholder in all the companies listed in the indictment .

An unsigned document, found in Webster's files, providing the background to the WPW Group of companies was presented in court. The document states that the WPW group was tasked by the Southern African Health Authorities with the establishment of clinics in a number of African countries. It also states that the group was involved in drug development. The report indicates that WPW had interests in the following areas:

1. Medical and Pharmaceutical development.
2. Data Management and Systems Development (in this regard mention is made of Data Image Pty Ltd, the company referred to in the 1998 TRC hearing into chemical and biological warfare as being responsible for capturing all technical project information on optical disk).
3. Aviation
4. Financing and Investments
5. Property Investments
6. Leisure related activities
7. Trading (including close trading links having been developed with North African countries).

Documents found by Bruwer indicate that on October 29, 1989, before the privatization of Delta G Scientific was completed in August 1991, Medchem Consolidated Investments held 75% of the Delta G shares, reduced to 51% on completion of privatization. How MCI came to be the majority shareholder in a declared SADF front company six months before the April 1990 launch of the privatization scheme has not yet been explained.

Another note breaks down the shareholding of Protechnic as follows: 55% WPW Investments, 30% Charburn, 15% Jan Lourens. Lourens is named as the MD with Bernard Zimmer, Wynand Swanepoel and PW de Jager as directors. There is an additional note which says: NB: Wouter Basson owns one third of Charburn. Bruwer testified that the shareholding of Protechnic changed several times. He could not establish whether or not the proposed merger took place, but confirmed that Protechnic was subsequently sold to Armscor.

Bruwer testified that the Jetstar, (which the defence claimed last year had been purchased with funding transferred to a European account from Project Coast and earmarked for the purchase of the peptide synthesizer) was sold in December 1995 (three years after Basson was asked to resign from the military and two months after his reappointment to the SADF) for U$2-million, through David Webster. Bruwer found no evidence of a connection between the Jetstar and the peptide synthesizer deal.

Throughout the week the structure of the companies mentioned in the indictment and financial transactions in which these companies were involved was dealt with in great detail. The prosecution presented documents and statements by directors of the companies to support the documentation. On Tuesday the defence lodged an objection, pointing out that the Bruwer report is based on hearsay (in respect of statements taken from Zimmer, Van Remoortere, Antoinette Lourens and Webster, amongst others) and that the prosecutor would be compelled to call these people as witnesses if the defence were to accept the supporting documents. Otherwise, the defence warned, all the documentary evidence will be inadmissible. The defence had agreed that the documents be presented during Bruwer's testimony on condition that the State prove their authenticity by means of testimony from the parties directly involved. The defence said that until this was done they would dispute every document. On Friday the court was informed by the prosecution that key witnesses were not prepared to come to South Africa to give evidence and that international judicial channels would have to be pursued.

Much of Tuesday's evidence involved the perusal of the exchange of correspondence between Basson and Webster regarding fund transfers and the establishment of companies.

On Wednesday 26 January Bruwer testified that he had discovered a deposit, on June 16, 1989, of �22 101 into an account at Bank Indosuez, Luxembourg, held in the name of Wouter Basson, on which he and his wife at the time, Claudine van Remoortere, both had signing powers. This is the first time testimony has been presented to indicate that funds were placed in accounts held by Basson personally. Bruwer alleged that the money formed part of the R5,5-million transferred from Project Coast in April 1988 to what was believed to be the Luxembourg account of ABC Import/Export, and which Basson claims was used to pay for the 25 Chemical Agent Monitors bought in two batches by Aubin Heyndrickx and Roger Buffham, and the 150 portable field detection kits.

During the detailed examination of the flow of funds the defence indicated that there was no intention on their behalf to dispute the flow of funds, merely the purpose thereof and that detail of the type entered into was therefore unnecessary. Justice Hartzenberg responded by supporting the defence and instructed the prosecution to confine itself to the report prepared by Bruwer and not to deal with the supporting documentation unless absolutely necessary. The Judge made it clear that the matter in dispute is whether Basson had acted in accordance with his military orders.

Bruwer testified that the funds referred to the first charge against Basson were not used for the benefit of Project Coast. He said that he could find no evidence of delivery of any scientific equipment, despite assurances given to the Office for Serious Economic Offences by both the former Project Manager, Gen. Knobel and project external auditor Pierre Theron that this is what the funds were used for. Bruwer claims to have established that neither the auditor, Pierre Theron nor Brigadier Hein Pfeil of Chief of Staff Finance made any attempt to verify the purchase or inspect the merchandise.

Evidence presented by Bruwer on Thursday indicated that WPW Investments Inc had several accounts. One, opened in London in 1989, gave individual signing powers to Basson and David Webster. Bank documents show that the beneficial owner of all assets deposited in the account is Mr. Wouter Basson, Pretoria, SA. Evidence was also presented that WPW had a US dollar account and another specifically for Hong Kong dollars at Credit Suisse in Zurich.

The case will continue next week with the testimony of Bruwer.

Centre for Conflict Resolution, UCT, Private Bag, Rondebosch, 7701, South Africa Tel: (27) 21-4222512 Fax: (27) 21-4222622 Email: [email protected]