Executives and officials said the U.S. settlement — in which BAE would
pay $400 million — ended about two years of negotiations with the Justice
Department. BAE had been under investigation for relaying $2 billion to
then-Saudi ambassador to Washington, Prince Bandar Bin Sultan, son of the
defense minister and a leading figure in military procurement.
"Any company conducting business with the United States that profits
through false statements will be held accountable," U.S. Deputy Attorney
General Lawrence Grindler said. "The alleged illegal conduct undermined U.S.
efforts to ensure that corruption has no place in international trade."
BAE, the second largest defense contractor in the world, said it also
agreed to pay nearly $50 million in fines to Britain's Serious Fraud Office.
The police unit had been investigating BAE concerning illegal payments to
officials in the Czech Republic, Romania, South Africa and Tanzania.
"We're satisfied with that global settlement," BAE chairman Richard
Oliver said. "It allows us to draw a very heavy line under the legacy, the
historical issues."
The company also agreed to plead guilty to a British charge of failing
to keep proper accounting records in Tanzania. Executives said BAE has
already implemented measures to prevent bribery to foreign procurement
officials.
"We're obviously pleased to see uncertainty removed for our
shareholders," Oliver said.
Still, British parliamentarians called for an independent inquiry into
the alleged BAE bribes. They said the government of then-Prime Minister Tony
Blair had blocked a police investigation into an alleged $130 million slush
fund established by BAE for Saudi princes and others responsible for weapons
procurement by Riyad.
About three months after the British police investigation was closed in
December 2006, BAE received an $8.9 billion contract for the supply of 72
Eurofighter Typhoons to Saudi Arabia. The first Eurofighters were delivered
in 2009.
"The British government was up to its neck in this whole business,"
Vince Cable, deputy chairman of the Liberal Democrats, said. "Government
ministers were almost certainly fully aware of what was happening."
