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Friday, May 25, 2007

Report: Saudi's Prince Bandar got $2 billion
in bribes

LONDON A leading Saudi prince received about $2 billion in bribes from BAE Systems, a newspaper here reported.

The London-based Guardian newspaper reported on Thursday that Saudi Prince Bandar Bin Sultan, the kingdom's national security adviser, received 1 billion British pounds to facilitate BAE contracts with Riyad. The British daily, which has written a series of stories on the Saudi-BAE connection, asserted that for more than a decade Bandar received secret payments from BAE through a U.S. bank in Washington.

"It is claimed that payments of 30m [pounds] were paid to Prince Bandar every quarter for at least 10 years," the Guardian said.

The alleged disclosure comes during international protests against Britain's decision to terminate a police investigation of BAE, Middle East Newsline reported. The company was alleged to have established a $100 million slush fund for Saudi princes responsible for military procurement.

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The Guardian, which cited "insider legal sources," said the British Defence Ministry authorized BAE's payments to Bandar, the son of Saudi Defense Minister Sultan Bin Abdul Aziz and who for more than 20 years was Riyad's ambassador to the United States. The secret arms sales commissions, reportedly paid to Bandar's account in Riggs Bank in Washington D.C., were said to have violated both British and U.S. law.

"There must be a full parliamentary inquiry into whether the government has deceived the public and undermined the anti-corruption legislation, which itself passed through parliament," British parliamentarian Vince Cable, the deputy leader of the Liberal Democrat Party, said. "It increasingly looks as if the motives behind the decision to pull the SFO inquiry were less to do with UK national interests but more to do with the personal interests of one of two powerful Saudi ministers."

The payments to Bandar, who refused to respond to the Guardian, were said to have stemmed from the Al Yamamah oil-for-arms project, which supplied Saudi Arabia with about $86 billion worth of aircraft, ships, weapons and training over the last 20 years. The Guardian said Britain's Serious Fraud Office, during a two-year investigation, discovered the payments by BAE, the prime contractor of Al Yamamah, to Bandar.

"The Al Yamamah program is a government-to-government agreement and all such payments made under those agreements were made with the express approval of both the Saudi and the UK governments," BAE said. "We deny all allegations of wrongdoing in relation to this important and strategic program."

Bandar was said to have played a key role in Al Yamamah in 1985. The sources said that in return, Bandar received cash transfers every quarter for more than a decade for what was termed marketing fees.

The Guardian said BAE was provided access to a Bank of England account that received up to 2 billion pounds [$4 billion] per year. The newspaper said the Defence Ministry's Defence Export Services Organisation was also allowed to withdraw funds from the secret account. The payments for Bandar were said to have come from the same account.

"The MoD is unable to respond to the points made since to do so would involve disclosing confidential information about Al Yamamah, and that would cause the damage that ending the investigation was designed to prevent," the British Defence Ministry said.

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