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U.K. “obstructing” BAE probe

LONDON: The British Government has been accused of stonewalling an American request for help with a criminal investigation into allegations of corruption against BAE Systems, Britain’s controversial arms company.

Among other things, the investigation reportedly relates to claims that the BAE paid secret commissions of up to £1 billion to swing a £43-billion defence contract with Saudi Arabia in the eighties. The beneficiaries of the alleged payments are said to include Prince Bandar bin Sultan, a former Saudi Ambassador to America and an influential member of the royal family, for his role in negotiating the contract, known as the al-Yamamah deal.

Last year, the then Prime Minister Tony Blair caused a furore when he intervened to call off an inquiry by the Serious Fraud Office (SFO) on grounds that it would damage Britain’s relations with Saudi Arabia. But there were reports that Riyadh had threatened to scrap a multi-billion pound contract to buy fighter jets if the SFO investigation went ahead. The contract was, finally, signed last week.

The BAE has claimed that all payments in relation to the al-Yamamah deal were “lawful”. It has set up a committee of independent experts to review its business ethics following controversies over its conduct.

Prince Bandar has strongly denied receiving any “improper” payments.

On Friday, The Guardian claimed that the British Government was “refusing” to cooperate with a U.S. criminal investigation.

“More than two months after an official request for mutual legal assistance [MLA] was received from Washington British Home Secretary Jacqui Smith has not yet allowed it to be acted upon. The U.S. investigators believe the British are being obstructive,” said the newspaper in a front-page report noting that this was “unusual behaviour towards a major ally, with whom legal cooperation is normally automatic”.

The request for cooperation reportedly came from the U.S. Department of Justice.

The report sparked calls for the government to help with the U.S. inquiry and also reopen the SFO investigation which Mr. Blair had scrapped. Liberal Democrat MP Norman Lamb said the refusal to cooperate with Washington made a “mockery” of its claim to fight corruption.

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