大象传媒

BAE wants SFO review

• Robert Peston
• 7 May 08, 12:00 AM

is urging the to into whether the defence giant paid illegal bribes and commissions in its massive Al-Yamamah defence deal with Saudi Arabia.

In an exclusive 大象传媒 interview broadcast on the Today Programme this morning, BAE's chairman, , told me he wanted the SFO to seek senior legal advice - known as counsel's opinion - on the prospects for mounting a successful prosecution against his company.

BAE's chairman believes a legal review of the Saudi case file would show that there would be little chance of bringing a successful prosecution.

It would, in his view, lift the shadow hanging over the defence contractor.

Some 18 months ago, the Serious Fraud Office abandoned its probe of the Al-Yamamah deal with Saudi Arabia, following representations from the British government that failure to do so would increase the risk of a terrorist outrage - because Saudi Arabia was threatening to withdraw security cooperation.

The High Court recently ruled that it was unlawful for the SFO to abandon the case on those grounds - though the SFO has since appealed to the House of Lords.

Mr Olver wants the evidence in the Al-Yamamah case reviewed whatever the outcome of the appeal, because he fears the reputation of his company will otherwise be indelibly stained by the insinuation that it has something to hide.

Funnily enough, he takes comfort from the recent High Court ruling that so embarrassed the SFO. In it, Lord Justice Moses said that the way the SFO stopped the Al-Yamamah probe was wrong, but he also said there was good reason to doubt whether the allegations in respect of the Al-Yamamah contract could be proved to be true.

This is the relevant part of Lord Justice Moses's judgement:

"According to the Attorney General's evidence, BAE has always contended that any payments it made were approved by the Kingdom of Saudi Arabia. In short they were lawful commissions and not secret payments made without the consent or approval of the principal.

The cause of anti-corruption is not served by pursuing investigations which fail to distinguish between a commission and a bribe. It would be unfair to BAE to assume that there was a realistic possibility, let alone a probability, of proving that it was guilty of any criminal offence. It is unfortunate that no time was taken to adopt the suggestion to canvass with leading counsel the Attorney's reservations as to the adequacy of the evidence."

Or to put it another way, Lord Justice Moses's judgement against the SFO wasn't quite as bad for BAE as was widely reported. That said, Dick Olver is taking something of a risk: there is no guarantee that a new review of the evidence by the SFO would lead it to abandon the case once and for all.

The SFO could decide to do precisely the opposite and re-open the probe. You'll probably remember that only last week, Robert Wardle, who has just retired as the Director of the SFO, told me that there were reasons to believe that pursuing the investigation could eventually amass sufficient evidence for a prosecution.

Dick Olver is making a calculated judgement - and he'll probably be prompting a little anxiety in Saudi Arabia, where the ruling family is no more enthusisastic than it ever was about having its business dealings with BAE raked over.

But BAE's chairman is gritting his teeth and hoping that his Saudi customers will ultimately recognise that the stain from Al-Yamamah can only be scrubbed clean by allowing a rigorous analysis of the propriety of the deal under British law.

He wants a new start for BAE. Which is why he also told me that he was committed to implement all the recommendations of the former Lord Chief Justice, Lord Woolf, on cleaning up the way BAE conducts business

Mr Olver added that creating a deepseated ethical culture in a company employing 97,000 would not be quick or easy - though he would have no hesitation in sacking anyone who breaches the new code of conduct.

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