Somaiya speaks out on Tanzania gov't scandals Monday, 28 April 2008 By Daniel Said EA BUSINESS WEEK DAR ES SALAAM, TANZANIA - In a new twist, a top businessman in Tanzania, Mr. Tanil Somaiya who is at the centre of controversy in relation to allegations of his involvement in recent scandals in Tanzania, has broken his silence saying that he has "never done any business with the government." Speaking on phone with EastAfrican Business Week in a country he did not like to mention last week, Somaiya said that he was surprised to hear that he has severally been implicated in the scandals involving the presidential jet, military radar, supplying of military trucks and helicopters to Tanzania. "Am about 42 years old, with more than 20 years in business, but let me assure you and Tanzanians that I have never in my life done any business with the Tanzania government," the tycoon said. Somaiya, believed to have bought about six companies in recent years, said that the monies came from other businesses and not from business with the government. "The money came from other businesses, they are not related to commissions paid by the government or whatsoever," he said. This newspaper sought for Somaiya's comments following reports that he had in recent years acquired about six companies with money believed to have been paid to him as commissions following the alleged four deals with the government. Among his acquired assets is a multibillion private luxurious boat and one of Tanzania's biggest security companies, Ultimate Security Company. "I know nothing about the radar, the presidential jet and military trucks said to have been supplied to the government and I challenge you to find my name in those transactions," he said. Somaiya said that his files at the Tanzania Revenue Authority (TRA) were 'clean and open for anyone to peruse.' "I conduct clean businesses in the country; these allegations come from my business competitors," he said. The name of Tanil Somaiya has been central to recent would be scandals. These include the purchase of a top-of-the range Gulfstream jet from the US for former President Benjamin Mkapa and the purchase of six Italian helicopters for the Tanzania Peoples' Defence Forces (TPDF). Others are the purchase of a military-air defence radar and the acquisition of an Italian fleet of Iveco trucks for the army. Somaiya is believed to be the local representative of Iveco. At the centre of controversy is the military air defence radar system bought from BAE Systems of the UK in 2001 for 28 million British pounds. It was disclosed in January 2007 that BAE had used Lloyds Bank and an offshore front company, Red Diamond, to pay a huge secret commission totaling 30% of the radar's price into a Swiss account. It was reported that the account belonged to Mr. Sailesh Vithlani, an agent closely connected with the Tanzanian military while it has alleged that the second smaller payment of one percent was made to a local Tanzanian company, run by Vithlani with his partner and friend Tanil Somaiya. But Somaiya insists that he had no knowledge of Vithlani's Swiss bank arrangements. Vithlani, now believed to be a fugitive in Switzerland, is being sought by both local Tanzania police and the Interpol. The Serious Fraud Office (SFO) in London discovered that about $12 million was secretly paid as kickbacks to Somaiya and Vithilani and it is alleged that some of the cash went to government officials in Tanzania. However, it has proved difficult to obtain hard evidence of onward receipts of money by Tanzanian officials or politicians although it has been established that Vithlani had been the intermediary at the centre of a whole network of other questionable military procurements.