The first appellant, Mr Schabir Shaik, and two companies he controlled, Nkobi Holdings (Pty) Ltd and Nkobi Investments (Pty) Ltd, were convicted in the Durban High Court of corruption under the Corruption Act 94 of 1992. The convictions arose from corrupt payments made between 1995 and 2002 to Mr Jacob Zuma, then a senior public office bearer, in order to secure political influence for Shaik and his business interests. Following the convictions, the National Director of Public Prosecutions applied under the Prevention of Organised Crime Act 121 of 1998 (POCA) for a confiscation order. The High Court granted an order requiring the appellants jointly and severally to pay the State the value of certain benefits found to be proceeds of crime, amounting to more than R34 million. These benefits related primarily to Nkobi Investments’ indirect shareholding in African Defence Systems (Pty) Ltd through Thint (Pty) Ltd, and dividends earned from that shareholding, which were linked to the arms deal. The Supreme Court of Appeal set aside part of the confiscation order but otherwise upheld it. The appellants then appealed to the Constitutional Court, challenging the remaining confiscation order on constitutional grounds.
The appeal was dismissed. The confiscation order granted by the High Court, as partially amended by the Supreme Court of Appeal, was upheld.
This case is a leading Constitutional Court authority on the interpretation and application of POCA confiscation provisions. It confirms the broad and purposive approach to determining whether benefits are derived from criminal conduct, reinforces the constitutionality of asset confiscation as a crime-control measure, and underscores the State’s power to strip offenders of economic gains obtained through corruption.