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June 07, 2007
BaE Corruption
I've been very sceptical of the previous revelations of corruption and bribery into the Al- Yamamah contract between Saudi Arabia and BaE. So, tarts get provided (sorry, "hostesses") for tired Sheikhs, pocket money here and there is doled out (given the size of the contract, yes, the odd million here and there is pocket money).
In the annals of international business this is all very small beer indeed. I've been involved (entirely legally I might add) in such things so if small fry like myself are, I take it to be just the way things are done.
However, this pushes it all up a notch, into the realms of serious corruption:
The arms company BAE secretly paid Prince Bandar of Saudi Arabia more
than £1bn in connection with Britain's biggest ever weapons contract,
it is alleged today.
A series of payments from the British firm 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 £30m were paid to Prince Bandar every quarter for at least 10 years.
No, even that doesn't bother me very much. Until recently, under UK law, even this was legal. Indeed, it was tax deductible, so legal was it.
This is the bit that does worry me though:
It is alleged by insider legal sources that the money was paid to Prince Bandar 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 secret commissions, which were outlawed by Britain in 2002.
To put it crudely, I have no problem with throwing money at a fat bloke in a turban. That's just the way parts of the world work. I don't mind the Paymaster General running the account, nor the Bank of England holding it, given that such payments were legal in the UK up until 2002.
But I do mind the corruption of the British body politic which then followed, when a legal inquiry into whether the law had been broken after this date was quashed, for fear of uncovering that the now illegal activity was continuing.
It's said that the definition of a diplomat is someone sent abroad to lie for his country. We do not accept said diplomat lying to us here. As with this story: I care not that foreigners have grubbed for bribes, I care not that we have offered them to foreigners. I care a very great deal that having changed the law, those in power continued to do so.
For that's the important point, the law. If they'll break one they made themselves, that we can no longer bribe foreigners, which others will they break? That it's OK to bribe at home as well?
June 7, 2007 in Scams and Frauds | Permalink
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Comments
Sorry, it's "BAe"
Posted by: Mark Wadsworth | Jun 7, 2007 2:23:15 PM
Good analysis.
The most blatant corruption I have personally encountered in British life was related to the Arts Council, who asked us to make an application for funds, then refused the application they had asked for, then asked for a business plan (costing a few thousand pounds) to support another application - said business plan to be written by a pal of the Arts Council administrator.
Needless to say, the business plan cost more than the grant applied-for.
At one remove I have also heard of corruption related to the 'good causes' money from the National lottery being funnelled to friends of the committees who dole out this money.
There is also now a fair bit of corruption in the administration and regulation of UK universities.
In general, I feel that corruption has probably increased in the UK public sector over the past decade and a half - probably due to XS red tape needing to be circumvented by personal favours (plus the general impossibility of sacking people in the public sector).
Posted by: Bruce G Charlton | Jun 7, 2007 3:29:19 PM
"Sorry, it's "BAe""
Not any more it's not. It's called "BAE Systems".
Posted by: Kay Tie | Jun 7, 2007 3:40:08 PM
Kay Tie, fair point, but BaE is totally off-piste.
Posted by: Mark Wadsworth | Jun 7, 2007 5:05:13 PM
"Kay Tie, fair point, but BaE is totally off-piste."
We are both in great danger of being called pendants by Tim when he gets back from his quicksilver conspiracy.
Posted by: Kay Tie | Jun 7, 2007 5:33:11 PM
I've been involved (entirely legally I might add)...
Yes, bribes are pretty much legal in Russia, aren't they?
Posted by: Tim Newman | Jun 8, 2007 3:20:49 AM
