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$100 million slush fund to Saudis discovered: UK arms company BAE

May 4, 2004 8:00 pm By Robert Spencer

cnbae21.jpeg
BAE’s Sir Dick Evans

From The Guardian, :

Files have been seized by Ministry of Defence police alleging corruption on a massive scale by Britain’s biggest arms firm, BAE Systems. Payments totalling more than £60m to prominent Saudis are listed, a far greater amount than has been previously alleged.

MoD fraud squad detectives investigating allegations of bribery of a civil servant have seized 386 boxes of “slush fund” accounts.

Most explosively, the documents detail £17m in benefits and cash allegedly paid by BAE, which is chaired by Sir Dick Evans, to the key Saudi politician in charge of British arms purchases, Prince Turki bin Nasser. He is recorded under the codename “PB”, alleged to mean “principal beneficiary”.

BAE is trying to secure another £1.5bn of arms deals from the Saudi regime, following the sale of planes, missiles and warships worth £50bn to them over the past 15 years.

The documents list by name every Saudi official alleged to have received benefits from BAE in recent years. These include a number of military attaches at Saudi Arabia’s London embassy, recorded as being provided with luxury London houses at BAE’s expense.

The documents, seized last week from a warehouse in Hertfordshire, include thousands of entries in accounts ledgers, itineraries, travel bookings and records, stretching back 10 years.

The Guardian has obtained copies of the key files. The picture they present may cause serious difficulties for BAE in its relations with law enforcement agencies, with the MoD and with US contractors. Lockheed, which uses BAE as a sub-contractor on the F35 fighter, is reported to have demanded that BAE directors sign statements promising they do not pay bribes or commissions.

Sir Kevin Tebbit, the permanent secretary at the MoD, rebuffed a Serious Fraud Office approach when allegations surfaced of the existence of a BAE slush fund, in 2001.

According to the files, while Sir Kevin was accepting personal assurances from Sir Dick that there was no need for an MoD investigation, BAE was not only providing free holidays to one of his own MoD officials, but also pouring millions into providing a lavish lifestyle for Saudi politicians and generals.

The files indicate that payments continued past February 14 2002, when it became illegal under UK law to pay foreign officials. A hotel bill of more than £70,000 is recorded for a Rome holiday for Prince Turki’s wife after this date.

Another such bill in the records is for £32,500 to continue paying the rent on a £1m Mayfair house for the then Saudi defence attache, Brigadier General Abdul Aziz Nasser Al-Abaykan.

There is much more. None of it looks good for BAE.

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Filed Under: Saudi Arabia, United Kingdom


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