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Fri 8 Jun, 2007 08:34 am
Lord Goldsmith 'hid £1bn BAE arms payments'
By George Jones, Political Editor
08/06/2007
Telegraph UK
The Attorney General, Lord Goldsmith, today denied ordering British investigators to conceal from an international anti-bribery watchdog more than £1 billion in secret payments allegedly made to a Saudi prince.
Lord Goldsmith denies he ordered payments to be concealed
The payments were allegedly received by Prince Bandar bin Sultan, the former Saudi ambassador to the United States, from BAE Systems for setting up the £40 billion Al Yamamah arms deal in the 1980s with the full knowledge of the Ministry of Defence.
The Guardian reported that when the Organisation for Economic Co-operation and Development (OECD) - the world's anti-corruption watchdog - tried to look into the deal earlier this year, the details were not disclosed by British officials.
Lord Goldsmith today strongly denied that he had been responsible for ordering the information to be withheld.
"It is absolutely untrue that I ordered investigators to conceal payments from the OECD. It is categorically denied,'' he told the BBC Radio 4 Today programme.
Lord Goldsmith, however, flatly refused to discuss the allegations concerning the payments - including claims that they continued after Labour came to power in 1997.
"I am not going into the detail of any of the individual allegations,'' he said.
"The reason is, as the Ministry of Defence has made clear and they are the responsible department, that they regard the United Kingdom as bound by confidentiality provisions. It is not for me to break those.''
Prince Bandar has "categorically'' denied receiving any improper payments and BAE said it had acted lawfully at all times.
The payments, which were allegedly made with the knowledge of the Ministry of Defence, were discovered during a Serious Fraud Office (SFO) investigation.
The SFO inquiry into the Al Yamamah deal was stopped in December and the OECD subsequently launched its own investigation.
Prince Bandar has close ties with the current US administration
It remains unclear whether the payments were actually illegal - though questions have been raised over whether they continued after 2001, when the UK made bribery of foreign officials an offence.
On Thursday Tony Blair, who has taken "responsibility" for the decision to halt the inquiry, declined to comment on the payments.
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''.
An inquiry by Panorama claimed that up to £120 million a year was secretly paid by BAE into accounts in the US for more than a decade.
In a statement, BAE said that all the information on the contract had been available to the SFO. "After an exhaustive investigation it was found, notwithstanding the issue of relations with Saudi, that there was no case to answer.
"We are very clear that it was a government-to-government contract and any payments relating to the contract would have been made with the express approval of the UK and Saudi governments."
Blair fends off row 'to press for Saudi deal'
Blair fends off row 'to press for Saudi deal'
By George Jones, Political Editor
Last Updated: 2:16am BST 09/06/2007
Telegraph UK
Tony Blair wants to sign a new £20 billion arms deal with Saudi Arabia before he leaves office later this month despite the mounting row over allegations of secret payments to a Saudi prince, Government sources indicated yesterday.
Lord Goldsmith strongly denied ordering details to be concealed about alleged ?'kickbacks' to Prince Bandar bin Sultan
Saudi Arabia had been on the brink of concluding the deal to supply Eurofighter Typhoon jets to Riyadh when fresh allegations emerged that BAE Systems had paid £1 billion in backhanders to Prince Bandar bin Sultan, former Saudi ambassador to the US.
The Prime Minister still hopes to clinch the deal before he leaves No 10 on June 27 - six months after the Serious Fraud Office was told to drop an investigation into the bribery allegations.
The deal had been in jeopardy because of Saudi anger at the probe - but was said to be back on track after the SFO inquiry was halted by the Government last December.
The imminence of a new deal is understood to have been behind Mr Blair's point-blank refusal to order a fresh inquiry. He claimed on Thursday that if the inquiry 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".
advertisementThe head of the SFO yesterday backed angry denials by Lord Goldsmith, the Attorney General, that he had ordered British investigators to conceal from an international watchdog the existence of the secret payments.
The Guardian claimed that when the Organisation for Economic Co-operation and Development tried to look into the deal earlier this year, the details were not disclosed by British officials.
Lord Goldsmith strongly denied that he had been responsible for ordering the information to be withheld.
"It is absolutely untrue that I ordered investigators to conceal payments from the OECD. This is what The Guardian alleged. It is categorically denied,'' he told the Today programme on BBC Radio 4. The SFO director, Robert Wardle, confirmed that Lord Goldsmith did not order information about the payments to be withheld from the OECD.
The SFO said: "The decision as to what information should be given to the OECD about the investigation was made by the SFO. The information provided by the SFO was as full as possible, having regard to the need to protect national security."
Mr Wardle insisted he had stopped the inquiry for national security reasons and was not pressed to do so by Lord Goldsmith - who refused to discuss the allegations, saying: "As the Ministry of Defence has made clear, and they are the responsible department, they regard the UK as bound by confidentiality provisions." It is unclear whether the alleged payments to the prince would have been illegal.
The BBC's Panorama programme, in a show to be broadcast on Monday, says BAE, the British arms manufacturer, paid hundreds of millions of pounds to the prince over a decade. It found that up to £120m a year was sent to two Saudi embassy accounts in Washington, which it claims to have established were a conduit to Prince Bandar.
The prince, who is head of the Saudi national security council, issued a statement denying that he had received any "kickbacks" or improper payments. He said that the payments had been properly made to the Saudi ministry of defence and aviation under the terms of the deal.
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