Posted on 06/07/2007 2:58:41 AM PDT by leadpenny
Last Updated: Thursday, 7 June 2007, 08:17 GMT 09:17 UK
A Saudi prince who negotiated a £40bn arms deal between Britain and Saudi Arabia received secret payments for over a decade, a BBC probe has found.
The UK's biggest arms dealer, BAE Systems, paid hundreds of millions of pounds to the ex-Saudi ambassador to the US, Prince Bandar bin Sultan.
The payments were made with the full knowledge of the Ministry of Defence.
Prince Bandar would not comment on the investigation and BAE Systems said it acted lawfully at all times.
The MoD said information about the Al Yamamah deal was confidential.
Private plane
Up to £120m a year was sent by BAE from the UK into two Saudi embassy accounts in Washington.
The BBC's Panorama programme has established that these accounts were actually a conduit to Prince Bandar for his role in the 1985 deal to sell more than 100 warplanes to Saudi Arabia.
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.
Prince Bandar was Saudi ambassador to the US for 20 years
The payments were discovered during a Serious Fraud Office (SFO) investigation.
The SFO inquiry into the Al Yamamah deal was stopped in December 2006 by attorney general Lord Goldsmith.
Prime Minister Tony Blair declined to comment on the Panorama allegations.
But he said that if the SFO investigation into BAE had not been dropped, it would have led to "the complete wreckage of a vital strategic relationship and the loss of thousands of British jobs".
Prince Bandar, who is the son of the Saudi defence minister, served for 20 years as US ambassador and is now head of the country's national security council.
Panorama reporter Jane Corbin explained that the payments were Saudi public money, channelled through BAE and the MoD, back to the Prince.
The SFO had been trying to establish whether they were illegal when the investigation was stopped, she added.
She believed the payments would thrust the issue back into the public domain and raise a number of questions.
'Bad for business'
Labour MP Roger Berry, head of the House of Commons committee which investigates strategic export controls, told the BBC that the allegations must be properly investigated.
If there was evidence of bribery or corruption in arms deals since 2001 then that would be a criminal offence, he said.
He added: "It's bad for British business, apart from anything else, if allegations of bribery popping around aren't investigated."
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".
"It seems to me very clear that this issue has got to be re-opened," Mr Cable told BBC Radio 4's The World Tonight.
"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."
My thought as I was reading this was that we have not heard the last of this.
Saudis expect Eurofighter Soon -- BBC
The same Eurofighters which "have flown highly successful missions against the F-22 [stealth fighter] during recent exercises in the US. "
What makes the Eurofighter fly? -- BBC
Are arms deals to support allied arms manufacturers worth selling such technology to our enemies?
-—bribery in the international, governmental arms trade-—NO-!!!!!!! (sarc)—
Nothing will come of this. You can’t sell in Saudi or to Saudis without a Saudi partner. The Royal family members are “partners” for every major Defense purchase. The payments or “commissions” to the partner are the Royal family’s way of distributing the oil wealth among themselves. Bandar probably had to share with others in the Family. It’s the way things are done. Do a little business, you can have a non-Royal Saudi partner; do big business, you get the Royal Family.
You forgot to add "allah akbar, peace be with him." Anytime you discuss our Saudi Masters, you must do this. Didn't you learn anything in the madrassa?
Sorry, I’ll now have to be re-educated in a remedial madrassa — coming soon to a town near me.
Are the Saudis pursuing this?
Most likely not.
Frankly, this is how business is done in this area.
Don’t know about GB, but the US has laws against corporations engaging in this kind of stuff.
Yes, but they are circumvented all the time. Many years ago, I worked for a publicly-held company that sold equipment to the Spanish telephone company. We had to pay 12% “commission” to certain offficials on every shipment. Any sales to Iran required a 15% payment to the Shah of Iran. Some countries were as low as 10%. This is common in almost every country in the world. The problem with shipping stuff to Africa is that there are many levels of payoffs needed.
I understand but this seems different. Paying money to the SA Amb to the US for 20 years. I wonder if this is coming out now because relations with SA have become so bad? Probably a lot of intriguing details we will never hear about.
Take a look at the timeline.
http://news.bbc.co.uk/2/hi/business/6182137.stm
Looks like the investigation was started and then stopped before it was finally opened again.
Unless BAE Systems is a wholly-owned subsidiary of a domestic stock corporation, all of which are covered by U.S. law forbidding such practices, no U.S. law has been broken. Since it appears that the UK has a similar law, then it looks like both BAE Systems and the Ministry of Defence have a problem in the UK. Imagine if the Pentagon approved such an arrangement to a U.S. defense contractor.
Saudi Arabia is a monarchy. Paying a member of the royal family isn't like bribing an elected official.
There isn't a distinct line between private funds of the royal family and public funds of the government.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.