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 The Bandar cover-up: who knew what, and when?
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The Bandar cover-up: who knew what, and when?
Attorney general urged to clarify role in concealing $1bn payments to prince
David Leigh and Rob Evans
Saturday June 9, 2007
The Guardian
The government was last night fighting to contain the fallout over £1bn in payments to a Saudi prince as the attorney general came under renewed pressure to explain how much he knew about the affair.
While in public the government was issuing partial denials about its role in the controversy, in private there were desperate efforts to secure a new BAE £20bn arms deal with Saudi Arabia.
And any hopes that the furore could be halted were dashed last night when the Guardian learned that the world's anti-corruption organisation, the OECD, was poised to resume its own inquiry into why the British government suddenly abandoned its investigations into the £43bn al-Yamamah arms deal.
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The OECD's anti-bribery panel will meet in Paris on June 19 and is expected to discuss the disclosures. When it travels to London, its inspectors are likely to ask ministers for a full explanation of their conduct.
Last night, the Liberal Democrat leader, Menzies Campbell, demanded to know the role of the attorney general in concealing from the OECD the payments of more than £1bn from BAE to Prince Bandar as part of the al-Yamamah contract.
The money was paid from an account at the Bank of England into accounts in Washington controlled by Prince Bandar. Details of the transfers were discovered by the Serious Fraud Office during the marathon investigation into BAE.
However, the SFO inquiry was suddenly halted late last year. Al-Yamamah, Britain's biggest ever arms deal, which was signed in 1985, involves the sale of Tornado fighter jets and Hawk aircraft.
The Guardian has this week published accusations that £30m a quarter - for at least 10 years - was paid into accounts controlled by Prince Bandar at the Riggs bank in Washington.
The attorney general yesterday categorically denied part of the Guardian story in the affair.
He said that he had not ordered British investigators to conceal the £1bn payments from the OECD.
The director of the SFO took responsibility for the decision to withhold information. In a statement, Robert Wardle said the decision was made by his own organisation "having regard to the need to protect national security".
The Guardian investigation has revealed that:
· The attorney general became aware of these payments because of the SFO inquiry into BAE corruption allegations.
· He recognised the vulnerability of the government to accusations of complicity over a long period in the secret payments.
· There is no dispute that, as reported by the Guardian, the fact of the payments was concealed from the OECD when it demanded explanations for the dropping of the SFO inquiry.
· UK government officials have been exposed as seeking to undermine the OECD process, and complaining that its Swiss chairman has been too outspoken.
· When, before publication, the Guardian originally asked the attorney general's office who was responsible for concealing the information from the OECD, the newspaper was told: "The information presented to the OECD bribery working group ... was prepared by AGO and SFO".
The AGO is the attorney general's office. Both departments report to Lord Goldsmith himself.
Last night, when Lord Goldsmith was asked if the concealment was done with his knowledge, he said he could not respond. His spokesman had previously said that full evidence had not been given to the OECD because of "national security" considerations. He also refused to discuss the allegations concerning the payments. "I am not going into the detail of any of the individual allegations," he said.
It also emerged yesterday that Des Browne, the defence secretary, held talks this week with the Saudi crown prince, Prince Sultan bin Abdul Aziz - the father of Prince Bandar - to try to secure a £20bn arms deal for BAE Systems.
Sir Menzies said the attorney general had more questions to answer.
"If it is true that information about payments made to Prince Bandar was not given to the OECD, then that is an allegation of the utmost seriousness. It would be unsupportable for Britain to sign up to an international agreement on bribery and then fail to honour its obligations when an investigation comes too close to home."
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Mustafa Mahmoud
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