Swiss banks & military intelligence under pressure for Apartheid involvement

SA President Thabo Mbeki was sent on his way to the G8 meeting in Canada this week with the news that billions of dollars in apartheid reparations are being sought by his fellow citizens against US and Swiss banks. He may have been cheered by the thought that he had a backstop position - or have felt that the ground was being cut from under his arguments for 'partnership' and more investment and aid.

At present only four South Africans are bringing cases but their numbers are likely to grow. An international conference may also be called to focus on the reparations and debt issue.

The issue of mass reparations seemed hopelessly idealistic a few years ago, but then US lawyers for Jewish victims of the Holocaust got to work on the Swiss banks, seeking a $ 1,25 billion settlement. Now there is broad agreement on the principle that the payments will be made. In addition this week the Swiss banks paid off an additional $ 674.000 to 90 victims or their heirs.

In contrast the four South Africans are seeking a massive $ 50 bn in their suits in the US and Switzerland. The banks being sued are Citicorp, Credit Suisse and UBS, the latter now merged with PaineWebber, a securities firm in New York. Representing the plaintiffs is US lawyer Ed Fagan, who led the Holocaust claims.

According to Aktion Finanzplatz Schweiz-Dritte Welt researcher Mascha Madoerin, Swiss financial transfers - loans and direct investment - increased rapidly in the '80s, and filled the gap left by UN and Western economic sanctions. For Swiss banks, this proved a highly profitable development - "from the mid-80s on through 1993, profits and interests from Swiss capital support for South Africa ran up to more than half a billion Swiss Francs yearly," says Madoerin.

Switzerland was the fourth most important business partner with SA after Germany (in the period 1971-93 Germany made an estimated DM 8,4 bn from investments in SA) the USA and the UK. The high point for Swiss direct investment in SA was 1989, but since 1994 and democratisation Swiss investment there has fallen off markedly.

However, there is an added dimension to past Swiss involvement - its official but secret military links to the apartheid state.

Last November Jubilee SA revealed that two top Swiss industrialists had in 1978 been secretly decorated by the then SA president PW Botha for their services to the SA state. Dieter Buehrle and Gabriel Lebedinsky received the Grand Cross and the Star of South Africa.

The two were members of the board of one of the Swiss Bank Corporation, which merged with Union Bank of Switzerland in 1998 to form UBS - one of the banks now being sued.

Buehrle was head of Oerlicon-Buehrle Holdings, and the long-serving CEO of this Swiss arms manufacturer, Lebedinsky, had been jailed in Switzerland for a year in 1970 for illegally delivering anti-aircraft weapons to South Africa between 1964 and 1968. Buehrle, his employer, was given an eight-month suspended sentence and a fine of SFr 20.000.

Over the past couple of years there has been an unbroken stream of reports about secret official Swiss links with the former apartheid state, triggered off by the trial of SA chemical and biological war scientist Wouter Basson and his relations with the former chief of Swiss military intelligence, Peter Regli.

Earlier the former deputy chief of SA military intelligence and special forces commander Chris Thirion confirmed to Swiss reporter Jean-Philippe Ceppi that a secret agreement had been formally concluded in 1986 between the Swiss and South African military intelligence services. The deal concerned the mutual exchange of information on nuclear, chemical and biological warfare - clearly incompatible with Swiss legal provisions and political conditions.

There were media reports of meetings between South African officials and their Swiss counterparts up to 1993. These included those in the Berne defence ministry with the then Swiss state secretary of defence, Hans-Ulrich Ernst, and SA police chief Lothar Neethling about the acquisition of chemical and biological protective gear. Earlier, according to an unpublished report of a parliamentary committee, Ernst had a "private holiday" arranged by the South African military attache, to visit SA military bases and the Angolan front "where possible attacks with chemical or biological weapons could be expected".

"This (1986) agreement was very important for us", Thirion is quoted as saying. "We paved the way for Basson," he told reporter Ceppi. Basson was acquitted on 46 charges in April in a highly controversial verdict, but the state has said it is appealing and Namibia has indicated it wants to extradite him for trial there.

The SA government, however, is edging toward a blanket amnesty at home and friendly partnership with potential investors abroad. It is therefore likely to find these echoes of the past more damaging than appealing. (SouthScan)