Revealed: UK arms sales corruption cover-up

The uniquely close relationship between arms companies and the UK Government - the target of CAAT’s 'Call the Shots' campaign - has existed for years. One result is the veil of official secrecy that surrounds major arms deals, making it difficult to expose the malpractice and corruption often associated with the arms trade until long after the event.

Explosive new documents have recently been uncovered by a CAAT researcher in the UK's National Archives, which reveal the lengths to which past and present Governments have gone to cover up questionable payments in UK arms deals. They also raise serious questions about the secrecy surrounding a recent new arms deal with the tyrannous Saudi Arabia.

To read the full details of these revelations, and the original documents, see the Guardian newspaper's full report here.

Then take action to help end state welfare and official secrecy for arms companies.

Bribery allegations - the 'sexed-up WMDs' of the 1970s

In 1977 the Daily Mail newspaper accused the nationalised company British Leyland of paying bribes to secure sales of Land Rovers and armoured vehicles around the world, including Saudi Arabia, and alleged that the then Labour Government under Prime Minister Jim Callaghan had been complicit in it. In the ensuing political storm, however, the letters on which the Mail's story was based were found to be forgeries. The Leyland executive who had revealed the scam was jailed, and the Mail's editor was forced to make a grovelling apology to Parliament and the country.

Pay-offs

In fact a confidential investigation by the National Enterprise Board, suppressed at the time, did indeed find evidence of questionable payments made by British Leyland through Swiss bank accounts. Payments were linked to deals for Land Rovers, buses and armoured vehicles to Iraq, Iran, Nigeria and Saudi Arabia.

Cover up

Faced with this evidence, the Government mounted an extraordinary cover-up of its knowledge of bribery by nationalised and private UK companies. Cabinet ministers gathered for a secret crisis meeting at the Prime Minister's country residence were told that "[t]here was no doubt that bribery had been going on for years on a large scale in the Middle East and Africa and that organisations responsible to government (including defence sales and nationalised industries) had been involved." Prime Minister Callaghan decided to hush the scandal up, ruling out a government inquiry and proposing to broker an agreed silence on the matter with Margaret Thatcher and the Conservative opposition.

Then and now

Most sensitively, the documents contain revelations with reverberations for current arms deals. As part of a contract to sell military Land Rovers to the Saudi National Guard, a 15% "commission" was paid via a Swiss bank account to a Mr N Fustuq, identified in the files as the brother-in-law of the National Guard's commander, Prince Abdullah bin Abdul Aziz. Last year Prince Abdullah acceded to the Saudi throne, and is currently brokering a major new Saudi-UK arms agreement, negotiated by Tony Blair and John Reid only last month.

Official secrecy

The official secrecy that protected these revelations for thirty years continues today. Even the 1970s government files surrounding Fustuq and Abdullah remain either heavily censored, or closed in the National Archives well beyond the normal '30-year' embargo for most official files. The Government also continues to suppress a 1992 National Audit Office report into bribery allegations surrounding the massive 1980s-90s Al Yamamah arms deal with Saudi Arabia. This is despite ongoing investigations by the Serious Fraud Office into allegations (denied by BAE) that BAE Systems ran a "slush fund" for members of the Saudi Royal Family as part of the Al Yamamah deal.

Take Action: Help end corruption now

A constant stream of revelations about corruption in previous arms sales puts more pressure than ever for this veil of secrecy surrounding the UK's arms trade to be ended, and for arms sales to be stopped where the risk of corruption exists. Click here to help stop the latest UK arms deal with the tyrannous Saudi Arabia.

For more information about how political favours for Britain's arms companies have enabled this and other weapons sales, see this recent CAAT press briefing.

24 January 2006