Saudi Prince "Received Arms Cash"

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Saudi prince 'received arms cash'
A Saudi prince received secret payments from the UK's biggest arms dealer, a BBC investigation has revealed.

http://news.bbc.co.uk/2/hi/uk_news/6728773.stm

6/6/2007

BAE Systems made regular payments of hundreds of millions of pounds to Prince Bandar bin Sultan for more than a decade.

The payments were made with the full knowledge of the Ministry of Defence.

Prince Bandar would not comment and BAE systems said they acted lawfully at all times. The MoD said information about the Al Yamamah deal was confidential.

The Prince served for 20 years as Saudi ambassador to the US.

Warplane deal
Up to £120m a year was sent by BAE from the UK into two Saudi embassy accounts in Washington for more than a decade.

The BBC's Panorama programme has established that these accounts were actually a conduit to Prince Bandar, the architect of the 1980s Al Yamamah deal to sell warplanes to Saudi.

The purpose of one of the accounts was to pay the expenses of the Prince's private Airbus.

David Caruso, an investigator who worked for the American bank where the accounts were held, said Prince Bandar had been taking money for his own personal use out of accounts that seemed to belong to his government.

He said: "There wasn't a distinction between the accounts of the embassy, or official government accounts as we would call them, and the accounts of the royal family."

Mr Caruso said he understood this had been going on for "years and years".

"Hundreds of thousands and millions of dollars were involved," he added.

Investigation stopped
According to Panorama's sources, the payments were written into the arms deal contract in secret annexes, described as "support services".

They were authorised on a quarterly basis by the MoD.

The payments were discovered during a Serious Fraud Office (SFO) investigation.

The SFO inquiry into the Al Yamamah deal was stopped in December 2006.

Prime Minister Tony Blair said at the time it had been dropped because of national security concerns.

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Saudi was 'secretly paid $2bn'

http://www.theage.com.au/articles/2007/06/07/1181089239165.html

http://www.theage.com.au/ffximage/2007/06/07/rg0806_wprince_narrowweb__300x420,0.jpg

David Leigh and Rob Evans, London
June 8, 2007

BRITAIN'S largest arms company is alleged to have secretly paid Prince Bandar bin Sultan of Saudi Arabia more than £1 billion ($A2.4 billion) in connection with Britain's biggest-ever weapons contract.

A series of payments from BAE was allegedly channelled through a US bank in Washington to an account controlled by one of the most colourful members of the Saudi ruling clan, who spent 20 years as their ambassador in the US.

It is claimed that payments of £30 million were paid to Prince Bandar every quarter for at least 10 years.

It is alleged by insider legal sources that the money was paid to him with the knowledge and authorisation of Ministry of Defence officials under the Blair Government and its predecessors.

For more than 20 years, ministers have claimed they knew nothing of the secret commissions, which were outlawed by Britain in 2002.

An inquiry by the Serious Fraud Office into the transact- ions behind the £43 billion al-Yamamah arms deal, signed in 1985, is believed to have uncovered details of the payments to Prince Bandar.

But the investigation was halted last December by the SFO after a review by the Attorney-General, Lord Goldsmith.

He said it was in Britain's national interest to halt the investigation, and that there was little prospect of achieving convictions. Tony Blair said he took "full responsibility" for the decision.

However, according to those familiar with the discussions at the time, Lord Goldsmith had warned colleagues that British "Government complicity" was in danger of being revealed.

The end of the investigation provoked an outcry from anti-corruption campaigners and led to the Organisation for Economic Co-operation and Development starting its own probe.

The fresh allegations may also cause BAE problems in the US, where corrupt payments to foreign politicians have been outlawed since 1977.

The allegations of payments to Prince Bandar are bound to ignite fresh controversy over the original deal and the aborted SFO investigation. The Saudi diplomat is known to have played a key role with Mrs Thatcher in setting up Britain's biggest-ever series of weapons deals.

For more than 20 years al-Yamamah, Arabic for "dove", has involved the sale of 120 Tornado aircraft, Hawk warplanes and other military equipment.

According to legal sources familiar with the records, BAE Systems made cash transfers to Prince Bandar every three months for 10 years or more. BAE drew the money from a confidential account held at the Bank of England that had been set up to facilitate the al-Yamamah deal.

Up to £2 billion a year was deposited in the accounts as part of a complex arrangement allowing Saudi oil to be sold in return for shipments of Tornado aircraft and other arms.

SFO investigators led by assistant director Helen Garlick first stumbled on the alleged payments, according to legal sources, when they unearthed highly classified documents at the Defence Ministry during their three-year investigation.

Prince Bandar, now head of Saudi's national security council, was asked about the alleged payments this week but did not respond.

BAE Systems also would not explain the alleged payments. The company said: "Your approach is in common with that of the least responsible elements of the media — that is to assume BAE Systems' guilt in complete ignorance of the facts."

Call to probe ministers' role in '£1bn arms deal'

http://edinburghnews.scotsman.com/index.cfm?id=892482007

BILL JACOBS WESTMINSTER EDITOR

TONY BLAIR was today facing calls for a full Westminster inquiry into Britain's biggest ever arms deal following claims that more than £1 billion was secretly channelled to a Saudi prince.

Reports today alleged that BAE Systems paid £120 million a year for ten years to former Saudi Ambassador to the US Prince Bandar bin Sultan with the full knowledge of the Ministry of Defence.

The cash was a commission for his role in negotiating the £40 billion Al Yamamah arms deal to supply 120 Tornado and Hawk war planes to the Gulf state.

The deal was negotiated when Margaret Thatcher was prime minister and has been the mainstay of BAE Systems defence arm ever since it was agreed in 1985.

Liberal Democrat Treasury spokesman Vince Cable said that if ministers in either the present or previous governments were involved there should be a "major parliamentary inquiry".

He called for the re-opening of the Serious Fraud Office inquiry into the Al Yamamah deal, which was controversially dropped last year after Tony Blair warned that the Saudis could end security co-operation.

"It is one thing for a company to have engaged in alleged corruption overseas. It is another thing if British government ministers have approved it" VINCE CABLE

"It seems to me very clear that this issue has got to be re-opened," Mr Cable said.

"It is one thing for a company to have engaged in alleged corruption overseas. It is another thing if British government ministers have approved it."

Labour MP Roger Berry, who chairs the Commons Quadripartite Committee of four Westminster all-party groups which looks at arms deals,

said: "These matters need to be properly investigated. It's bad for British business, apart from anything else, if allegations of bribery popping around aren't investigated."

Prince Bandar, BAE Systems and the Ministry of Defence all refused to comment.

An investigation for the BBC Panorama programme and The Guardian alleged payments were made on a quarterly basis at £30 million for more than ten years into two bank accounts held by Prince Bandar.

They were said to have been written in to secret annexes of the Al Yamamah contract for the provision of "support services" and specifically authorised by the MoD's arms sales department.

The investigation claims that these accounts were a means of getting the money to Prince Bandar.

The investigation also claims that the SFO inquiry was stopped in December 2006 by Mr Blair and Attorney General Lord Goldsmith after it discovered the payments to the prince, son of the Saudi Defence Minister.

However, the inquiry never established whether these payments were in fact illegal.

One investigator in America, David Caruso, said the prince had apparently been taking money for his own personal use out of accounts that seemed to belong to the Saudi government.

He said: "There wasn't a distinction between the accounts of the Embassy, or official government accounts as we would call them, and the accounts of the Royal Family."

An MoD spokesman said: "The MoD is unable to comment on these allegations since to do so would involve disclosing confidential information about Al Yamamah and that would cause the damage that ending the investigation was designed to prevent."

A spokesman for the SFO said its inquiry had been halted because of the "real and serious threat to national security."

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For those who don't know, this is Bandar Bush.

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BAE Systems rocked by US anti-corruption probe

http://rawstory.com/news/afp/BAE_Systems_rocked_by_US_anti_corru_06262007.html

Published: Tuesday June 26, 2007

The US Department of Justice has launched an inquiry into British arms manufacturer BAE Systems' compliance with anti-corruption laws, including those regarding lucrative Saudi contracts, BAE revealed on Tuesday.

The news sent the share price in BAE, which makes about 40 percent of its sales in the United States, plunging 10.57 percent to 395.50 pence in early afternoon deals on London's falling FTSE 100 index.

"BAE Systems has been notified by the US Department of Justice that it has commenced a formal investigation relating to the company's compliance with anti-corruption laws including the company's business concerning the Kingdom of Saudi Arabia," it said in a brief statement to the London Stock Exchange.

The group has been accused of setting up a 60-million-pound (89-million-euro, 120-million-dollar) slush fund for members of the Saudi royal family to secure business, and of making illegal payments to those involved in its deals.

BAE strenuously denies the charges.

Britain's Serious Fraud Office (SFO) had been investigating BAE Systems' 43-billion-pound Al-Yamamah deal in 1985, which provided Hawk and Tornado jets plus other military equipment for the Saudis.

But the investigation was shelved in December in a move supported by outgoing British Prime Minister Tony Blair amid concerns over Britain's national and international interests.

The PM's official spokesman was asked on Tuesday whether Blair had any regrets about the SFO investigation being closed and a new inquiry being opened in the United States.

He told reporters: "I have no comment to make whatsoever. Our position on the investigation in this country hasn't changed. We have no comment to make on the inquiry in the States."

"It would be wrong to do so in this country and wrong to do so in any other coutry."

He also said he had no comment to make when asked if British officials were ready and willing to co-operate with the US authorities.

The probe comes at a crucial time for BAE Systems after it won US regulatory approval last week for a takeover of US defence group Armor Holdings in a deal worth 4.5 billion dollars.

A company spokesman said Tuesday that BAE would not comment on the substance of the formal US investigation.

But he added: "The company is committed to meeting the highest ethical standards in its dealings with others, and doesn't tolerate unethical behaviour or attempts to improperly influence decisions for customers.

"We continue to be very proud of the support we give to the armed forces globally."

Meanwhile, the Organisation for Economic Cooperation and Development (OECD), which coordinates policies and advises member countries on governance, said it had "serious concerns" about the SFO probe being dropped.

The Guardian newspaper in Britain has alleged that BAE secretly transferred more than one billion dollars to accounts controlled by Prince Bandar, who was at the time Saudi Arabia's ambassador to Washington.

The center-left daily has also alleged that BAE bought the prince a top-of-the-range Airbus airliner worth 75 million pounds and was still paying the costs of flying it.

Both the prince and BAE have denied any charges of wrong-doing.

BAE contracts are still being investigated by British justice officials in Africa, eastern Europe and South America.

Earlier this month, meanwhile, BAE set up an independent committee to evaluate the firm's business practices and ensure they abide by the highest ethical standards.

But Lord Harry Woolf, a retired judge heading the committee, and BAE chairman Dick Olver have suggested the panel would not examine media allegations of impropriety surrounding the Saudi deal.

Analysts said the allegations could affect BAE's agreed purchase of Armor Holdings, which manufactures armored vehicles and other equipment for the US military and law enforcement.

BAE wants to boost its growing operations in the United States, one of the world's largest defence markets.