A prominent local businessman, Tanil Kumar Chandulal Somaiya, is being officially investigated by British detectives over his role in the scandalous $41m (approx. 52bn/-) military radar purchase by the Tanzanian government in 2002, it has been confirmed.
Somaiya, proprietor of the well-known Shivacom Group of companies, has publicly denied any involvement in the scandal in which large amounts of bribery money are believed to have exchanged hands, but is nonetheless still considered a key suspect by the UKs Serious Fraud Office (SFO).
According to officials familiar with the ongoing radar deal investigation, Somaiya is one of three Tanzanians being investigated by the SFO, along with ex-attorney general Andrew Chenge and ex-Bank of Tanzania governor (now Tanzania Electric Supply Company managing director) Dr Idris Rashidi.
Somaiya, who recently sought to clear his name from the various allegations against him through an interview with a local television station, is a former business partner and close ally of fugitive radar deal agent Shailesh Vithlani, who has been described as the deals chief paymaster.
In 2006, both Somaiya and Vithlani were questioned under oath by SFO investigators at the Kisutu resident magistrates court in Dar es Salaam.
Court records show that the duo formally admitted that they at one time or another had legal authority to represent a shadowy company believed to have been paid an abnormally high commission of $12m (approx. 15bn/-) by the UK-based radar manufacturer, BAE Systems, to facilitate the controversial deal.
During the cause of the SFO investigation, it has been revealed that Somaiya and Vithlani held a joint power of attorney over the company in question, Envers Trading Corporation, which is believed to have used much of the commission payment to pay illegal kickbacks to senior officials in the third phase government of ex-president Benjamin Mkapa to approve the transaction.
Envers Trading operated from a local address in Dar es Salaam associated with Merlin International Limited, another local company that THISDAY investigations have already established was originally registered in March 1986 with Somaiya and Vithlani as joint directors.
According to our findings, Merlin International initially operated in relative anonymity, dealing in general merchandise and imported goods in Mwanza region.
But in August 1998, the firm filed a report with the registrar of companies to indicate that it had shifted the location of its main offices to Dar es Salaam.
It was from this period that the previously little-known company became oddly interwoven with some of the countrys biggest defence deals, including the questionable radar transaction and other similarly-controversial deals for the supply of military vehicles and helicopters.
The company was located on the first floor of Avalon House along Zanaki Street/Sokoine Drive in downtown Dar es Salaam. At the time of its initial registration, Vithlani was listed as majority shareholder with 8,000 shares, while Somaiya had 2,000 shares.
But following the recent spate of local media reports on the ongoing radar deal probe, Somaiya opted to end his long-running business relationship with Vithlani, announcing to authorities his complete withdrawal from Merlin International.
However, informed sources point out that although Somaiya says he has now severed all business links with Vithlani, the radar deal and many of the other dubious deals were concluded when the two were still very much in partnership.
Records from the Kisutu court show that when subjected to questioning by British detectives, Somaiya admitted that he was given power of attorney over Envers Trading Corp. for a period of 11 months.
However, he claimed that he had no other involvement with the company, and was not even aware of the companys official location.
During interrogations held on two separate occasions (July 25 and July 28, 2006), Somaiya also admitted to being co-owner of the city-based Merlin International company with Vithlani, whom he described as a very good friend.
Nevertheless, while SFO investigators continue to regard Somaiya as an official suspect, his legal status with local investigating authorities remains decidedly uncertain.
Although the governments own Prevention and Combating of Corruption Bureau (PCCB) has long been conducting its own, parallel investigation into the radar deal, it does not appear - albeit publicly - to be making any headway.