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South African Indian to pay $5.5 mn

S Shaik was convicted of fraud and and ordered to pay $5.5 mn in a govt corruption scandal.

india Updated: Feb 01, 2006 17:02 IST

A South African Indian has been ordered to forfeit 34 million rands ($5.5 million) to the state for his alleged role in a corruption scandal that led to the dismissal of former deputy president Jacob Zuma.

Schabir Shaik was convicted last year of corruption and fraud after a marathon trial and sentenced to 15 years imprisonment, which he is appealing.

During Shaik's trial, presiding judge Hilary Squires referred to his relationship with Zuma as "generally corrupt". This led to President Thabo Mbeki dismissing Zuma after the latter disregarded calls for him to step down.

On Tuesday, Squires ruled that Shaik's "corrupt relationship with Zuma was worth 34 million rands" and that the state was entitled to all of this.

South African legislation allows for the seizure of all assets believed to be the proceeds of crime under the Organised Crime Prevention Act.

Shaik said after the ruling that he had now become the victim of "a political fight between Mbeki and Zuma".

Zuma was being seen as the next president when Mbeki finishes his second term in office in 2009, and factions within both the ruling African National Congress and its alliance partners are still supporting him.

Allegations at the time involved French company Thales, which was claimed to have paid 250,000 to Shaik's company Kobitech as a "bribe" for Zuma to secure a multi-million rand South African arms deal.

The state submitted that there was an "overwhelming possibility" that Shaik's relationship with Zuma was the main reason for Thales to do business with Shaik's company.

The National Prosecuting Authority had wanted to seize Shaik's assets soon after his conviction in June last year but Squires had ordered that the assets be placed in curatorship until this hearing.

Shaik indicated that he would appeal this decision.

First Published: Feb 01, 2006 16:26 IST