Al-Yamamah arms deal
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Al Yamamah ( ar, اليمامة, translation=The
Dove Columbidae () is a bird family consisting of doves and pigeons. It is the only family in the order Columbiformes. These are stout-bodied birds with short necks and short slender bills that in some species feature fleshy ceres. They primarily ...
) is the name of a series of record arms sales by the United Kingdom to
Saudi Arabia Saudi Arabia, officially the Kingdom of Saudi Arabia (KSA), is a country in Western Asia. It covers the bulk of the Arabian Peninsula, and has a land area of about , making it the fifth-largest country in Asia, the second-largest in the Ara ...
, paid for by the delivery of up to of
crude oil Petroleum, also known as crude oil, or simply oil, is a naturally occurring yellowish-black liquid mixture of mainly hydrocarbons, and is found in geological formations. The name ''petroleum'' covers both naturally occurring unprocessed crude ...
per day to the
British government ga, Rialtas a Shoilse gd, Riaghaltas a Mhòrachd , image = HM Government logo.svg , image_size = 220px , image2 = Royal Coat of Arms of the United Kingdom (HM Government).svg , image_size2 = 180px , caption = Royal Arms , date_est ...
. The prime contractor has been
BAE Systems BAE Systems plc (BAE) is a British multinational arms, security, and aerospace company based in London, England. It is the largest defence contractor in Europe, and ranked the seventh-largest in the world based on applicable 2021 revenue ...
and its predecessor
British Aerospace British Aerospace plc (BAe) was a British aircraft, munitions and defence-systems manufacturer. Its head office was at Warwick House in the Farnborough Aerospace Centre in Farnborough, Hampshire. Formed in 1977, in 1999 it purchased Marconi ...
. The first sales occurred in September 1985 and the most recent contract for 72
Eurofighter Typhoon The Eurofighter Typhoon is a European multinational twin-engine, canard delta wing, multirole fighter. The Typhoon was designed originally as an air-superiority fighter and is manufactured by a consortium of Airbus, BAE Systems and Leonardo ...
multirole fighters was signed in August 2006.
Mike Turner Michael Ray Turner (born January 11, 1960) is an American politician serving as the U.S. representative for since 2003. He is a member of the Republican Party. Turner's district, numbered as the 3rd district from 2003 to 2013, is based in Day ...
, then CEO of BAE Systems, said in August 2005 that BAE and its predecessor had earned £43 billion in twenty years from the contracts and that it could earn £40 billion more. It is Britain's largest ever export agreement, and employs at least 5,000 people in Saudi Arabia. In 2010, BAE Systems pleaded guilty to a United States court, to charges of false accounting and making misleading statements in connection with the sales. An investigation by the British Serious Fraud Office into the deal was discontinued after political pressure from the Saudi and British governments.


Background

The UK was already a major supplier of arms to Saudi Arabia prior to Al Yamamah. In 1964 the
British Aircraft Corporation The British Aircraft Corporation (BAC) was a British aircraft manufacturer formed from the government-pressured merger of English Electric Aviation Ltd., Vickers-Armstrongs (Aircraft), the Bristol Aeroplane Company and Hunting Aircraft in 19 ...
conducted demonstration flights of their
Lightning Lightning is a naturally occurring electrostatic discharge during which two electrically charged regions, both in the atmosphere or with one on the ground, temporarily neutralize themselves, causing the instantaneous release of an average ...
aircraft in
Riyadh Riyadh (, ar, الرياض, 'ar-Riyāḍ, lit.: 'The Gardens' Najdi pronunciation: ), formerly known as Hajr al-Yamamah, is the capital and largest city of Saudi Arabia. It is also the capital of the Riyadh Province and the centre of the ...
and in 1965 Saudi Arabia signed a letter of intent for the supply of Lightning and Strikemaster aircraft as well as
Thunderbird Thunderbird, thunder bird or thunderbirds may refer to: * Thunderbird (mythology), a legendary creature in certain North American indigenous peoples' history and culture * Ford Thunderbird, a car Birds * Dromornithidae, extinct flightless birds ...
surface to air missiles. The main contract was signed in 1966 for 40 Lightnings and 25 Strikemasters (eventually raised to 40). In 1973 the Saudi government signed an agreement with the British government which specified BAC as the contractor for all parts of the defence system ( AEI was previously contracted to supply the radar equipment and
Airwork Services Airwork Limited, also referred to during its history as Airwork Services Limited, is a wholly owned subsidiary company of VT Group plc. It has a long and rich history in providing a variety of defence support services to the Royal Air Force (RA ...
provided servicing and training). Overall spending by the
Royal Saudi Air Force The Royal Saudi Air Force ( ar, ‎الْقُوَّاتُ الْجَوِّيَّةُ الْمَلَكِيَّةْ ٱلسُّعُوْدِيَّة, Al-Quwwat Al-Jawiyah Al-Malakiyah as-Su’udiyah) (RSAF) is the aviation branch of the Saudi Arabia ...
(RSAF) was over £10 billion (SAR 57 billion). In the 1970s, United States defence contractors won major contracts, including 114
Northrop F-5 The Northrop F-5 is a family of supersonic light fighter aircraft initially designed as a privately funded project in the late 1950s by Northrop Corporation. There are two main models, the original F-5A and F-5B Freedom Fighter variants and t ...
s. In 1981 the RSAF ordered 46
F-15C The McDonnell Douglas F-15 Eagle is an American twin-engine, all-weather tactical fighter aircraft designed by McDonnell Douglas (now part of Boeing). Following reviews of proposals, the United States Air Force selected McDonnell Douglas's ...
s and 16 F-15Ds, followed in 1982 by the purchase of 5 E-3A AWACS aircraft. Following these deals and partly due to pro-Israeli sentiment in the US Congress, which would have either blocked a deal or insisted on usage restrictions for exported aircraft, Saudi Arabia turned to the UK for further arms purchases.


Summary

The ''
Financial Times The ''Financial Times'' (''FT'') is a British daily newspaper printed in broadsheet and published digitally that focuses on business and economic current affairs. Based in London, England, the paper is owned by a Japanese holding company, Nik ...
'' reported Saudi Arabian "interest" in the
Panavia Tornado The Panavia Tornado is a family of twin-engine, variable-sweep wing multirole combat aircraft, jointly developed and manufactured by Italy, the United Kingdom and West Germany. There are three primary Tornado variants: the Tornado IDS (inte ...
in July 1984. Export had become a possibility after West Germany lifted its objections to exports outside of
NATO The North Atlantic Treaty Organization (NATO, ; french: Organisation du traité de l'Atlantique nord, ), also called the North Atlantic Alliance, is an intergovernmental military alliance between 30 member states – 28 European and two N ...
. In September 1985 Saudi Arabia agreed "in principle" to a Tornado,
Hawk Hawks are birds of prey of the family Accipitridae. They are widely distributed and are found on all continents except Antarctica. * The subfamily Accipitrinae includes goshawks, sparrowhawks, sharp-shinned hawks and others. This subfa ...
and missile deal. On 26 September 1985 the defence ministers of the UK and Saudi Arabia sign a Memorandum of Understanding in London for 48 Tornado IDSs, 24 Tornado ADVs, 30 Hawk training aircraft, 30
Pilatus PC-9 The Pilatus PC-9 is a single-engine, low-wing tandem-seat turboprop training aircraft manufactured by Pilatus Aircraft of Switzerland. Designed as a more powerful evolution of the Pilatus PC-7, the PC-9's first flight was made in May 1984 after ...
trainers, a range of weapons, radar, spares and a pilot-training programme. The second stage (Al Yamamah II) was signed on 3 July 1988 in
Bermuda ) , anthem = "God Save the King" , song_type = National song , song = "Hail to Bermuda" , image_map = , map_caption = , image_map2 = , mapsize2 = , map_caption2 = , subdivision_type = Sovereign state , subdivision_name = , es ...
by the defence ministers of the UK and Saudi Arabia. Although the full extent of the deal has never been fully clarified, it has been described as "the biggest ritishsale ever of anything to anyone", "staggering both by its sheer size and complexity". At a minimum, it is believed to involve the supply and support of 96
Panavia Tornado The Panavia Tornado is a family of twin-engine, variable-sweep wing multirole combat aircraft, jointly developed and manufactured by Italy, the United Kingdom and West Germany. There are three primary Tornado variants: the Tornado IDS (inte ...
ground attack aircraft, 24 Air Defence Variants (ADVs), 50
BAE Hawk The BAE Systems Hawk is a British single-engine, jet-powered advanced trainer aircraft. It was first flown at Dunsfold, Surrey, in 1974 as the Hawker Siddeley Hawk, and subsequently produced by its successor companies, British Aerospace and B ...
and 50
Pilatus PC-9 The Pilatus PC-9 is a single-engine, low-wing tandem-seat turboprop training aircraft manufactured by Pilatus Aircraft of Switzerland. Designed as a more powerful evolution of the Pilatus PC-7, the PC-9's first flight was made in May 1984 after ...
aircraft, specialised naval vessels, and various infrastructure works. The initial Memorandum of Understanding committed the UK to purchasing the obsolete Lightning and Strikemaster aircraft, along with associated equipment and spare parts. The British government's prime contractor for the project is BAE Systems. BAE has approximately 4,000 employees working directly with the
Royal Saudi Air Force The Royal Saudi Air Force ( ar, ‎الْقُوَّاتُ الْجَوِّيَّةُ الْمَلَكِيَّةْ ٱلسُّعُوْدِيَّة, Al-Quwwat Al-Jawiyah Al-Malakiyah as-Su’udiyah) (RSAF) is the aviation branch of the Saudi Arabia ...
(also see
Military of Saudi Arabia The Saudi Arabian Armed Forces (SAAF) ( ar, القُوَّات المُسَلَّحَة العَرَبِيَّة السُّعُودِيَّة, Al-Quwwat al-Musallahah al-Malakiyah as-Su’ūdiyah), also known as the Royal Saudi Armed Forces, ar ...
). The success of the initial contract has been attributed to Prime Minister
Margaret Thatcher Margaret Hilda Thatcher, Baroness Thatcher (; 13 October 19258 April 2013) was Prime Minister of the United Kingdom from 1979 to 1990 and Leader of the Conservative Party from 1975 to 1990. She was the first female British prime ...
, who lobbied hard on behalf of British industry. A Ministry of Defence briefing paper for Thatcher detailed her involvement in the negotiations: There were no conditions relating to security sector reform or human rights included in the contracts. Contracts between BAE Systems and the Saudi government have been underwritten by the
Export Credits Guarantee Department , type = Department , logo = UK Export Finance logo.svg , logo_width = 150 , logo_caption = , seal = , seal_width = , seal_caption = , picture = Government Offices Great George Street. ...
, a tax-payer funded insurance system. Guarantees on a contract worth up to £2.7 billion were signed by the Government on 1 September 2003. In December 2004, the Commons Trade Committee chairman, Martin O'Neill, accused the Government of being foolish for concealing a £1 billion guarantee they have given to BAE Systems.


Al Yamamah I

*48
Panavia Tornado The Panavia Tornado is a family of twin-engine, variable-sweep wing multirole combat aircraft, jointly developed and manufactured by Italy, the United Kingdom and West Germany. There are three primary Tornado variants: the Tornado IDS (inte ...
IDS (interdictor/strike aircraft) **28 GR1 standard **6 GR1A reconnaissance standard **14 dual control trainers *24
Panavia Tornado ADV The Panavia Tornado Air Defence Variant (ADV) was a long-range, twin-engine interceptor version of the swing-wing Panavia Tornado. The aircraft's first flight was on 27 October 1979, and it entered service with the Royal Air Force (RAF) in 19 ...
s, equivalent to RAF's Tornado F3 standard *
JP233 Originally known as the LAAAS (Low-Altitude Airfield Attack System), the JP233 is a British submunition delivery system consisting of large dispenser pods carrying several hundred submunitions designed to attack runways. Design and development ...
runway denial munition *
Sea Eagle A sea eagle or fish eagle (also called erne or ern, mostly in reference to the white-tailed eagle) is any of the birds of prey in the genus ''Haliaeetus'' in the bird of prey family Accipitridae. Taxonomy and evolution The genus ''Haliaeetus'' ...
anti-ship missile *
ALARM An alarm device is a mechanism that gives an audible, visual or other kind of alarm signal to alert someone to a problem or condition that requires urgent attention. Alphabetical musical instruments Etymology The word ''alarm'' comes from t ...
anti-radar missile *
Skyflash The Skyflash, or Sky Flash in marketing material, was a medium-range semi-active radar homing air-to-air missile derived from the US AIM-7 Sparrow missile and carried by Royal Air Force McDonnell Douglas F-4 Phantoms and Tornado F3s, Italian ...
air-to-air missile The first aircraft (two Hawks) were delivered on 11 August 1987 at BAE's Dunsfold facility.


Al Yamamah II

Deliveries early 1990s – 1998 *48 Panavia Tornado IDS


Eurofighter Typhoon (al-Salam)

In December 2005 the governments of the UK and Saudi Arabia signed an "Understanding Document" which involved the sale of Typhoon aircraft to replace RSAF Tornados and other aircraft. Although no details were released, reports suggested the deal involved the supply of 72 aircraft. On 18 August 2006 a contract was signed for 72 aircraft. The aircraft cost approximately £4.43 billion, and the full weapons system is expected to cost approximately £10 billion.


Tornado upgrade

In February 2006 ''
Air Forces Monthly ''Air Forces Monthly'' is a military aviation magazine published by Key Publishing, and based in Stamford, Lincolnshire, United Kingdom. It was established in 1988. It provides news and analysis on military aviation, technology and related topics ...
'' suggested that the eventual Eurofighter order may reach 100 and the deal could include the upgrade of the RSAF's Tornado IDS aircraft, likely similar to the RAF's Tornado GR4 standard. In an editorial the magazine also raises the prospect of a requirement for a new lead-in fighter trainer to replace the earlier generation of Hawk 65/65As and to provide adequate training for transition of pilots to the advanced Typhoon. BAE System's 2005 Interim Report noted that three RSAF Tornado IDS' arrived at their Warton facility for design evaluation tests with the ultimate aim being "to improve serviceability, address obsolescence, and enhance and sustain the capability of the aircraft". On 10 September 2006 BAE won a £2.5 bn (€3.7 bn, $4.6 bn) contract for the upgrade of 80 RSAF Tornado IDS aircraft.


Corruption allegations

There have been numerous allegations that the Al Yamamah contracts were a result of
bribes Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official, or other person, in charge of a public or legal duty. With regard to governmental operations, essentially, bribery is "Corru ...
(french: douceurs) to members of the
Saudi royal family The House of Saud ( ar, آل سُعُود, ʾĀl Suʿūd ) is the ruling royal family of Saudi Arabia. It is composed of the descendants of Muhammad bin Saud, founder of the Emirate of Diriyah, known as the First Saudi state (1727–1818), ...
and government officials. Some allegations suggested that the former prime minister's son
Mark Thatcher Sir Mark Thatcher, 2nd Baronet (born 15 August 1953) is an English businessman. He is the son of Margaret Thatcher, Prime Minister of the United Kingdom from 1979 to 1990, and Sir Denis Thatcher; his sister is Carol Thatcher. His early career ...
may have been involved; however, he has strongly denied receiving payments or exploiting his mother's connections in his business dealings. In February 2001, the solicitor of a former BAE Systems employee, Edward Cunningham, notified Serious Fraud Office of the evidence that his client was holding which related to an alleged "slush fund". The SFO wrote a letter to
Kevin Tebbit Sir Kevin Reginald Tebbit (born 18 October 1946)"TEBBIT, Sir Kevin Reginald (1946 - )", ''Debrett's People of Today'', 2004 is a former British civil servant. Career He was educated at the Cambridgeshire High School for Boys and was a senior hi ...
at the MoD who notified the Chairman of BAE Systems but not the Secretary of Defence. No further action was taken until the letter was leaked to and reported on by ''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers '' The Observer'' and '' The Guardian Weekly'', ''The Guardian'' is part of the ...
'' in September 2003. In May 2004, Sir Richard Evans appeared before parliament's defence
select committee Select committee may refer to: *Select committee (parliamentary system) A select committee is a committee made up of a small number of parliamentary members appointed to deal with particular areas or issues originating in the Westminster system o ...
and said: "I can certainly assure you that we are not in the business of making payments to members of any government." In October 2004, the BBC's ''Money Programme'' broadcast an in-depth story, including allegations in interviews with Edward Cunningham and another former insider, about the way BAE Systems alleged to have paid bribes to Prince Turki bin Nasser and ran a secret £60 million
slush fund A slush fund is a fund or account that is not properly accounted, such as money used for corrupt or illegal purposes, especially in the political sphere. Such funds may be kept hidden and maintained separately from money that is used for legitim ...
in relation to the Al Yamamah deal. Most of the money was alleged to have been spent through a front company called Robert Lee International Limited. In June 2007 the BBC's investigative programme ''
Panorama A panorama (formed from Greek πᾶν "all" + ὅραμα "view") is any wide-angle view or representation of a physical space, whether in painting, drawing, photography, film, seismic images, or 3D modeling. The word was originally coined i ...
'' alleged that BAE Systems "paid hundreds of millions of pounds to the ex-Saudi ambassador to the US, Prince Bandar bin Sultan". According to the Campaign Against Arms Trade, successive British governments have given support to British Aerospace Engineering (BAE). In doing so, they have given support to the Saudi regime and undermined global efforts to eradicate corruption. It has brought into question the integrity of British business more generally. In his book, David Wearing uses the example of F&C Asset Management, a major institutional investor, who (despite benefiting in the short term), warned the defence procurement minister that it would reduce the efficient functioning of financial markets as a whole. "We believe that, for long term investors, bribery and corruption distort and de-stabilise markets, expose companies to legal liabilities, disadvantage non-corrupt companies and reduce transparency", thus undermining national legislation governing corrupt practices.


1992 NAO report

The National Audit Office (NAO) investigated the contracts and has so far not released its conclusions – the only NAO report ever to be withheld. Official statements about the contents of the report go no further than to state that the then chairman of the
Public Accounts Commission The Public Accounts Commission is a UK body created under the National Audit Act 1983 to audit the National Audit Office, i.e., to watch the watchers.
, now Lord Sheldon, considered the report in private in February 1992, and said: "I did an investigation and I find no evidence that the MOD made improper payments. I have found no evidence of fraud or corruption. The deal ... complied with Treasury approval and the rules of Government accounting." In July 2006, Sir John Bourn, the head of the NAO, refused to release a copy to the investigators of an unpublished report into the contract that had been drawn up in 1992. The MP Harry Cohen said, "This does look like a serious conflict of interest. Sir John did a lot of work at the MoD on Al Yamamah and here we now have the NAO covering up this report." In early 2002 he had proposed an Early Day Motion noting "that there have been ... allegations made of large commission payments made to individuals in Saudi Arabia as part of ... Al Yamamah ... ndthat Osama bin Laden and the Al-Qaeda network have received substantial funds from individuals in Saudi Arabia."


Serious Fraud Office investigation

The Serious Fraud Office was reported to be considering opening an investigation into an alleged £20 million slush fund on 12 September 2003, the day after ''The Guardian'' had published its slush fund story. The SFO also investigated BAE's relationship with Travellers World Limited. In November 2004, the SFO made two arrests as part of the investigation. BAE Systems stated that they welcomed the investigation and "believe that it would put these matters to rest once and for all". In late 2005, BAE refused to comply with compulsory production notices for details of its secret offshore payments to the Middle East. The terms of the investigation was for a prosecution under Part 12 of the Anti-terrorism, Crime and Security Act 2001.


Threats by the Saudi government

At the end of November 2006, when the long-running investigation was threatening to go on for two more years, BAE Systems was negotiating a multibillion-pound sale of
Eurofighter Typhoon The Eurofighter Typhoon is a European multinational twin-engine, canard delta wing, multirole fighter. The Typhoon was designed originally as an air-superiority fighter and is manufactured by a consortium of Airbus, BAE Systems and Leonardo ...
s to Saudi Arabia. According to the BBC the contract was worth £6 billion with 5,000 people directly employed in the manufacture of the Eurofighter, while other reports put the value at £10 billion with 50,000 jobs at stake. On 1 December, ''
The Daily Telegraph ''The Daily Telegraph'', known online and elsewhere as ''The Telegraph'', is a national British daily broadsheet newspaper published in London by Telegraph Media Group and distributed across the United Kingdom and internationally. It was f ...
'' ran a front-page headline suggesting that Saudi Arabia had given the UK ten days to suspend the Serious Fraud Office investigation into BAE/Saudi Arabian transactions or they would take the deal to France, but this threat was played down in other quarters. A French official had said "the situation was complex and difficult ... and there was no indication to suggest the Saudis planned to drop the Eurofighter." This analysis was confirmed by Andrew Brookes, an analyst at the
International Institute for Strategic Studies The International Institute for Strategic Studies (IISS) is a British research institute or think tank in the area of international affairs. Since 1997, its headquarters have been Arundel House in London, England. The 2017 Global Go To Think ...
, who said "there could be an element here of trying to scare the SFO off. Will it mean they do not buy the Eurofighter? I doubt it." There were reports of a systematic PR campaign operated by
Tim Bell Timothy John Leigh Bell, Baron Bell (18 October 1941 – 25 August 2019), was a British advertising and public relations executive, best known for his advisory role in Margaret Thatcher's three successful general election campaigns and his c ...
through newspaper scare stories, letters from business owners and MPs in whose constituencies the factories were located to get the case closed. Robert Wardle, head of the SFO, also stated (in a later High Court challenge, see below) that he had received a direct threat of a cessation of
counterterrorist Counterterrorism (also spelled counter-terrorism), also known as anti-terrorism, incorporates the practices, military tactics, techniques, and strategies that governments, law enforcement, business, and intelligence agencies use to combat or el ...
co-operation from the Saudi Arabian ambassador to the UK, in the first of three meetings held to assess the seriousness of the threat: "as he put it to me, British lives on British streets were at risk". Article 5 of the OECD Convention on Combating Bribery prohibits the decision to drop investigations into corruption from being influenced by considerations of the national economic interest or the potential effect upon relations with another state. This does not however explicitly exclude grounds of national security. This prompted the investigation team to consider striking an early guilty plea deal with BAE that would minimise the intrusiveness to Saudi Arabia and mitigate damage. The Attorney General agreed the strategy, but briefed Prime Minister Blair, who in a reply dated 5 December 2006 urged that the case be dropped. Despite affirming his government's commitment to bribery prosecution, he stressed the financial and counter-terrorism implications. That same day,
Prince Bandar A prince is a male ruler (ranked below a king, grand prince, and grand duke) or a male member of a monarch's or former monarch's family. ''Prince'' is also a title of nobility (often highest), often hereditary, in some European states. The ...
met with Foreign Office officials, after spending a week with Jacques Chirac to negotiate a French alternative to the BAE deal. A week later, after consultation with the SFO, the Attorney General met with Blair to argue against dropping the case. It was Blair's opinion that "Any proposal that the investigation be resolved by parties pleading guilty to certain charges would be unlikely to reduce the offence caused to the Saudi Royal Family, even if the deal were accepted, and the process would still drag out for a considerable period". On 13 December, the Director of the SFO wrote to the Attorney General to inform him that the SFO was dropping the investigation and would not be looking into the Swiss bank accounts, citing "real and imminent damage to the UK's national and international security and would endanger the lives of British citizens and service personnel."


Investigation discontinued

On 14 December 2006, the
Attorney General In most common law jurisdictions, the attorney general or attorney-general (sometimes abbreviated AG or Atty.-Gen) is the main legal advisor to the government. The plural is attorneys general. In some jurisdictions, attorneys general also have exec ...
Lord Goldsmith announced that the investigation was being discontinued on grounds of the public interest. The 15-strong team had been ordered to turn in their files two days before. The statement in the House of Lords read: The Prime Minister, Tony Blair, justified the decision by saying "Our relationship with Saudi Arabia is vitally important for our country in terms of counter-terrorism, in terms of the broader Middle East, in terms of helping in respect of Israel and Palestine. That strategic interest comes first."
Jonathan Aitken Jonathan William Patrick Aitken (born 30 August 1942) is a British author, Church of England priest, former prisoner and former Conservative Party politician. Beginning his career in journalism, he was elected to Parliament in 1974 (serving u ...
, a former
Conservative Conservatism is a cultural, social, and political philosophy that seeks to promote and to preserve traditional institutions, practices, and values. The central tenets of conservatism may vary in relation to the culture and civilization in ...
government minister and convicted
perjurer Perjury (also known as foreswearing) is the intentional act of swearing a false oath or falsifying an affirmation to tell the truth, whether spoken or in writing, concerning matters material to an official proceeding."Perjury The act or an inst ...
, who was connected with the deals in the 1980s, said that even if the allegations against BAE were true, it was correct to end the investigation to maintain good relations with Saudi Arabia.
Mark Pieth Mark Pieth (born 9 March 1953) is Professor of Criminal Law at the University of Basel, Switzerland and a prominent anti-corruption expert. Pieth's career as a legal expert, defence lawyer, judge and compliance advisor includes several roles on t ...
, director of anti-fraud section at the
OECD The Organisation for Economic Co-operation and Development (OECD; french: Organisation de coopération et de développement économiques, ''OCDE'') is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate ...
, on behalf of the United States, Japan, France,
Sweden Sweden, formally the Kingdom of Sweden,The United Nations Group of Experts on Geographical Names states that the country's formal name is the Kingdom of SwedenUNGEGN World Geographical Names, Sweden./ref> is a Nordic countries, Nordic c ...
,
Switzerland ). Swiss law does not designate a ''capital'' as such, but the federal parliament and government are installed in Bern, while other federal institutions, such as the federal courts, are in other cities (Bellinzona, Lausanne, Luzern, Neuchâtel ...
and
Greece Greece,, or , romanized: ', officially the Hellenic Republic, is a country in Southeast Europe. It is situated on the southern tip of the Balkans, and is located at the crossroads of Europe, Asia, and Africa. Greece shares land borders wi ...
, addressed a formal complaint letter before Christmas 2006 to the
Foreign Office Foreign may refer to: Government * Foreign policy, how a country interacts with other countries * Ministry of Foreign Affairs, in many countries ** Foreign Office, a department of the UK government ** Foreign office and foreign minister * Unit ...
, seeking explanation as to why the investigation had been discontinued.
Transparency International Transparency International e.V. (TI) is a German registered association founded in 1993 by former employees of the World Bank. Based in Berlin, its nonprofit and non-governmental purpose is to take action to combat global corruption with civil ...
and Labour MP
Roger Berry Roger Leslie Berry (born 4 July 1948) is a British Labour Party politician, who was the Member of Parliament (MP) for Kingswood from the 1992 general election ending at the 2010 general election. Early life Roger Berry was born in 1948 in ...
, chairman of the Commons Quadripartite Committee, urged the government to reopen the corruption investigation. In a newspaper interview, Robert Wardle, head of the Serious Fraud Office, acknowledged that the decision to terminate the investigation may have damaged "the reputation of the UK as a place which is determined to stamp out corruption". Delivery of the first two Eurofighter Typhoon aircraft (of 72 purchased by the Saudi Air Force) took place in June 2009.


Judicial review

A judicial review of the decision by the SFO to drop the investigation was granted on 9 November 2007. On 10 April 2008 the
High Court of Justice The High Court of Justice in London, known properly as His Majesty's High Court of Justice in England, together with the Court of Appeal and the Crown Court, are the Senior Courts of England and Wales. Its name is abbreviated as EWHC ( Engl ...
ruled that the SFO "acted unlawfully" by dropping its investigation. ''The Times'' described the ruling as "one of the most strongly worded judicial attacks on government action" which condemned how "ministers "buckled" to "blatant threats" that Saudi cooperation in the fight against terror would end unless the ... investigation was dropped." On 24 April the SFO was granted leave to appeal to the
House of Lords The House of Lords, also known as the House of Peers, is the upper house of the Parliament of the United Kingdom. Membership is by appointment, heredity or official function. Like the House of Commons, it meets in the Palace of Westminst ...
against the ruling. There was a two-day hearing before the Lords on 7 and 8 July 2008. On 30 July the House of Lords unanimously overturned the High Court ruling, stating that the decision to discontinue the investigation was lawful.


OECD investigation

The OECD sent their inspectors to the UK to establish the reasons behind the dropping of the investigation in March 2007. The OECD also wished to establish why the UK had yet to bring a prosecution since the incorporation of the OECD's anti-bribery treaty into British law.


US Department of Justice investigation

On 26 June 2007 BAE announced that the
United States Department of Justice The United States Department of Justice (DOJ), also known as the Justice Department, is a federal executive department of the United States government tasked with the enforcement of federal law and administration of justice in the United Stat ...
had launched its own investigation into Al Yamamah. It was looking into allegations that a US bank had been used to funnel payments to Prince Bandar. The
Riggs Bank Riggs Bank was a bank headquartered in Washington, D.C. For most of its history, it was the largest bank headquartered in that city. On May 13, 2005, after the exposure of several money laundering scandals, the bank was acquired by PNC Financia ...
has been mentioned in some accounts. On 19 May 2008, BAE confirmed that its CEO Mike Turner and non-executive director
Nigel Rudd Sir Nigel Rudd, (born 31 December 1946 in Derby, England) is a Fellow of the Institute of Chartered Accountants. In 1982, he founded Williams Holdings, a company which went on to become one of the largest industrial holding companies in the Uni ...
had been detained "for about 20 minutes" at George Bush Intercontinental and Newark airports respectively the previous week and that the DOJ had issued "a number of additional subpoenas in the US to employees of BAE Systems plc and BAE Systems Inc as part of its ongoing investigation". ''The Times'' suggests that, according to Alexandra Wrage of Trace International, such "humiliating behaviour by the DOJ" is unusual towards a company that is co-operating fully. Under a plea bargain with the US Department of Justice BAE was sentenced in March 2010 by US District Court Judge John D. Bates to pay a $400 million fine, one of the largest fines in the history of the DOJ. US District Judge John Bates said the company's conduct involved "deception, duplicity and knowing violations of law, I think it's fair to say, on an enormous scale". BAE was not convicted of bribery, and is thus not internationally blacklisted from future contracts.


See also

*
Wafic Saïd Wafic Rida Saïd ( ar, وفيق رضا سعيد) (born 21 December 1939) is a Syrian- Saudi-Canadian financier, businessman, and philanthropist, who has resided for many years in Monaco.David Pallister, 'The man of substance in the shadows', '' ...
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Lockheed bribery scandals The Lockheed bribery scandals encompassed a series of bribes and contributions made by officials of U.S. aerospace company Lockheed from the late 1950s to the 1970s in the process of negotiating the sale of aircraft. The scandal caused consid ...


References


External links



– OECD to press Blair over BAE inquiry ''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers '' The Observer'' and '' The Guardian Weekly'', ''The Guardian'' is part of the ...
'' December 2006
Al-Yamamah Scandal
2009-10-24)

– The Al-Yamamah Connection : bombs, bribery and BAE Systems.
Corp Watch – BAE System's Dirty Dealings
{{Webarchive, url=https://web.archive.org/web/20070709061344/http://www.corpwatch.org/article.php?id=9008 , date=9 July 2007 – November 2003

– ''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers '' The Observer'' and '' The Guardian Weekly'', ''The Guardian'' is part of the ...
'' – August 2003


Documentary Video


Black Money
PBS Frontline ''Frontline'' (stylized as FRONTLINE) is an investigative documentary program distributed by the Public Broadcasting Service (PBS) in the United States. Episodes are produced at WGBH in Boston, Massachusetts. The series has covered a variet ...
documentary (watch online) BAE Systems Political scandals in the United Kingdom Corporate scandals Foreign relations of Saudi Arabia Foreign relations of the United Kingdom Royal Saudi Air Force Weapons trade 2010 crimes in the United States Accounting scandals Finance fraud Corruption in the United Kingdom Corruption in the United States Saudi Arabia–United Kingdom military relations