Tanzanian Association Oslo

UK under pressure to probe

radar company

THISDAY REPORTER & AGENCIES
Dar es Salaam

THE British government is under pressure to re-open a corruption investigation against the UK’s leading arms manufacturer, BAE Systems, over a 43 billion pounds sterling ($85bn) contract to provide Saudi Arabia with fighter jets and other military equipment.

The same company on the spotlight over the 1985 deal with Riyadh sold a controversial 28 million pounds (approx. 70bn/-) military radar system to the Tanzanian government in 2002 -- a transaction currently being probed by both local and British corruption fighters.

In London, calls were made yesterday for a full public inquiry after the British High Court ruled this week that the UK government and Serious Fraud Office ’’unlawfully submitted’’ to threats that there could be another terrorist attack in Britain unless they dropped bribery investigations involving BAE Systems and Saudi Arabia.

Two senior UK judges on Thursday condemned the British government’s ’’abject surrender’’ to ’’blatant threats’’ that Saudi co-operation in the fight against terror would end unless the probe into corruption was halted.

The judges said: ’’We fear for the reputation of the administration of justice if it can be perverted by a threat.’’

They warned that any similar future unlawful threats to the rule of law must be resisted by government or the courts would again intervene.

Lord Justice Moses and Mr Justice Sullivan declared: ’’No one, whether within this country or outside, is entitled to interfere with the course of our justice.’’

The ruling was a victory for anti-bribery campaigners Corner House and the Campaign Against Arms Trade, which had argued that the Serious Fraud Office decision to stop the investigation was tainted by government concerns about trade with Saudi Arabia and diplomatic considerations.

They accused the British authorities of giving in to blackmail and said the decision to drop the probe was illegal under the OECD’s anti-bribery convention.

Giving their decision, the judges said the man behind the threats was Prince Bandar, the head of the Saudi national security council and son of the crown prince.

He has been the subject of accusations that he took more than 1bn in payments from BAE.

The Serious Fraud Office had launched an investigation into BAE’s 43bn arms deal with Saudi Arabia in 1985.

But Tony Blair, prime minister at the time, said the Saudis had privately threatened to cut intelligence co-operation with Britain unless the inquiry was stopped.

In December 2006, then attorney general Lord Goldsmith announced the investigation into the arms company was to be discontinued, but it was Serious Fraud Office director Robert Wardle who took the decision.

Following the landmark ruling, UK government ministers are now under growing pressure to reopen investigations against BAE Systems.

In Tanzania, at least one senior cabinet minister is currently being investigated by local and British detectives over the dubious 2002 radar deal between former President Benjamin Mkapa’s government and BAE Systems.

Investigations by THISDAY have revealed that the minister in question (name withheld for now) was searched at his Dar es Salaam office and residence about a fortnight ago.

Authorities have already blocked access to a number of local and international bank accounts held by the politician.

The ’crooked’ minister is alleged to have received millions of US dollars in bribes from controversial transactions including the military radar and air traffic control system deal.

According to the sources, the minister’s personal bank accounts along with the accounts of some close family members - including his children - have all been frozen as the investigations continue.

British detectives investigating the 28 million pounds sterling (approx. 70bn/-) radar scandal have traced some of the $12m (approx. 15bn/-) illegal kickbacks paid to fugitive businessman Shailesh Vithlani to a personal bank account owned by the minister abroad.

BAE Systems is understood to have secretly paid the $12m to Vithlani’s own Swiss bank account. The money is alleged to have been used to pay what amounted to bribes to senior Tanzanian public officials to approve the radar deal in 2002.

The minister now said to be under increasingly-intense investigation, held a high-level position in the third phase government of ex-president Benjamin Mkapa from 1995 to 2005, and is currently also serving as a senior cabinet member in President Jakaya Kikwete’s fourth phase administration.

He is believed to have played a key role in a number of controversial government contracts in various key sectors (including energy and minerals, to name a few) during the Mkapa administration.

But contrary to widespread public expectations, he somehow managed to survive the comprehensive cabinet reshuffle conducted by President Kikwete back in February.

Both Britain’s Serious Fraud Office (SFO) and the Prevention and Combating of Corruption Bureau (PCCB) in Tanzania have been investigating the radar deal, with British detectives frequently flying to the country to link up with their local counterparts in questioning some suspects.