Special Hearings — Chemical And Biological Warfare Hearings — 1998-07-08

MR VALLY: And then I certainly will let you go to TRC10.  Well, Roodeplaat Breeding Enterprises, Roodeplaat Research Laboratories, Technotec, Tensim Investments, Waterson Properties, Waterson Properties (Pty) Ltd - it may be the same company, Woselko Holdings, Wisdom Erf 82, Wisdom Erf 1219, Wisdom Finance, Wisdom Holdings, Wisdom Idle Winds Property. These may even be located in America but these were companies which had peoples who had dealings with aspects of Project Coast.  Wisdom Liquor Centre, Wisdom Properties, Wisdom Travel (Pty) Ltd and WPW Investments Incorporated.
 Now, the question - and then you can maybe use TRC10 to answer me.

DR KNOBEL: Yes.

MR VALLY: These were a large number of companies where individuals who were involved with Project Coast at some stage were directors of these companies and maybe you can explain this to us as to why, and we can look at TRC10.

DR KNOBEL: So your question is now Mr Vally?

MR VALLY: I'm trying to understand the linkages because all of a sudden I'm told only Delta G was a government front, yet Delta G is a wholly owned subsidiary of Medchem Technologies but Medchem Technologies wasn't a front company.  I'm trying to understand this in view of the fact of a large number of these front, well, you say not front companies, but companies with directors who come from Project Coast or have some links with Project Coast.

DR KNOBEL: Yes, thank you.  I will now take you to TRC10 and I would like you also to look at my documents that I've given you.  There is one, I think it is in Appendix H, which was the briefing to the Minister of Defence on the 10th of August '93.  First of all Mr Vally, if you look at number 10.  That is a letter that has been drawn up by the Chief of Staff Finance and the person who drew it up or who is the enquiries addressee is Brigadier Koertzen.  It's a letter to the Minister of Defence, 15th of February '91 and it is signed by General Liebenberg as Chief of the Defence Force and then finally approved by the Minister.
 All front companies that the Defence Force established for whatever reason, and this is only one project of the Defence Force, there were other projects  all front companies had to be approved by the Minister on an annual basis.  And this letter that you have in front of you is the letter for 1991 and in that letter you'll see that the front companies that approval is asked for through the office of Chief of Staff Finance and signed by the Chief of the Defence Force and approved by the Minister, are the following:  John Truter Financial, Roodeplaat ...[intervention]

MR VALLY: Can we just stop there for a while.  John Truter Financial Consultants ...[intervention]

DR KNOBEL: You know Mr Vally, surely you're not going to give me a chance now to try and deal with your question.

MR VALLY: Very well, I just some clarity so that we can locate these companies but I'll ask it after you're finished.

DR KNOBEL: I'll do exactly what you ...[intervention]

MR VALLY: Do carry on.

DR KNOBEL: We can come back to any other question you may have but please!

MR VALLY: Go on.

DR KNOBEL: That list, from A to G were the front companies that had been approved for that year by the Minister.  If you look at the bottom, paragraph 5, it says
"During 1990 one of the previous front companies namely Delta G, has been privatised and is now no longer a front company"
 So what I'm trying to explain to you is that on an annual basis, in terms of this project, we had to get approval through the office of the Chief of the Defence Force and through his Chief of Staff Finance, which is a laid down procedure within the Defence Force, to obtain approval by the Minister for front companies.  
 I also have a letter here which you do not have in your possession which is of the previous year, where Delta G is still included as one of the front companies, but in that year the privatisation process began to take place and the privatisation process is explained in a very lengthy letter which you do not have in your possession but which is now in the possession of the Auditor General and of OSEO, in which the Minister and the Minister of Finance approved the process that was going to be followed to privatise both Delta G initially and later on Roodeplaat and some of the others later on as well.
 That led to the directors, basically the directors of those companies with a shareholding in the company, taking over the control over the company and controlling it through a holding company.  What Doctor Mijburgh said yesterday was essentially true.  The Medchem Technologies that he had established was the holding company as he explained.
 The briefing to the Minister of Defence, Annexure H, which is now a year later in August '93, if you look at the attachment to that briefing: "Aanhangsel A", I'm giving the Minister a summary there of what the situation was with regards to front companies and I said: "This is the chronological history of each of these companies and how they developed, there is the history of Delta G: 
"Founded April 1992
 Plant opened Midrand '85
 Company sold to employees in 1991
 Last contracts finalised March '93
 Final transfer of share certificates 1993"
Can you see, that reflects the process.  Roodeplaat the next one:
"Roodeplaat founded in 1981
 Sold to management
Final transfer 31 March
 Infradel, Sefmed, D John Truter"
And that is where the list ends.  Which again reflects to you which were the major or front companies that had been established with State funds.  
 And if you then look further it says:
"Other Companies"
And it mentions:
"Lifestyle Management, Protechnic Laboratories and Technotec"
which were private companies and that I say very clearly there:
"They were however never owned by the SADF"
Now this is why I've been trying to say to you from the start that Protechnic was a private company.  I've been reflecting on this, you must understand I took over as Surgeon General in 1988, this is how it was transmitted to me, conveyed to me and I had no reason to doubt it and I reported as such to the Minister.
 In view of what you've asked me and in view of the other testimony that was given here I can see that it is possible that SRD was a front company which Jan Lourens I think gave testimony to that effect, it then changed its name to Protechnic, it may still have been a front company then but at a certain stage it was taken over by van Remoortere and Zimmer and it was then a private company.  And certainly when I was Surgeon General and I had to co-ordinate or manage the project I saw that as a private company.  There's nothing sinister about that.
 Now to come back to your question, this list that you've just started reading from with 102 names on it, I assure you the only companies on this list that were front companies were those reflected on the documents that I've now referred to you.  All the others were established by individuals as explained by Doctor Mijburgh.  What I think happened here is when the privatisation was taking place, when it became clear to the two main companies, we're really talking about Delta G mainly and Roodeplaat, those directors of those companies had to find another area where they could carry on with their business and they established these companies.  
 Let me tell you National Intelligence at the moment is conducting a full investigation into even other names that are not included on this list, and so is the office of Serious Economic Offences.  They are extremely interested to see what had happened to all of these companies.
 My own knowledge of them is really of such a nature that I can't give you any further information.  I can simply confirm to you that none of the others on this list, except the ones I've given you on the reference, were front companies of the Defence Force.