In February 2010, BAE, acknowledging that it violated an anti-corruption
accord, agreed to pay more than $400 million in connection with allegations
that the company bribed the former U.S. ambassador to Saudi Arabia, Prince Bandar Bin Sultan. Bandar, responsible for the Yamama project, worth nearly
$100 billion, was said to have received $2 billion from the company.
BAE said the $79 million fine would be paid over three years. The fine
could also be reduced by up to $10 million, already invested by the company
to enhance export control measures.
"The company looks forward to working with the State Department to
ensure that it continues to make progress towards achieving its goal as
being as widely recognized for responsible conduct as it is for high quality
products and advanced technologies," BAE chairman Dick Oliver said.
In December 2006, British police were pressured to end an investigation
of the alleged BAE slush fund. About two months later, Saudi Arabia signed
an agreement to purchase 72 Eurofighter Typhoon combat aircraft from BAE in
a deal reported at $8.9 billion.
The Justice Department said BAE used fronts to relay secret payments to
Turki and others. BAE was said to have violated U.S. law by not reporting
the transfers, made to a bank in Washington D.C.
So far, major BAE contracts with the U.S. military have not been not
affected by the corruption scandal. The State Department, however, said
three BAE subsidiaries — CS&S International, Red Diamond Trading Ltd., and
Poseidon Trading Investments — would face export restrictions.
"The company is grateful to the State Department for the time and effort
its staff have invested over the last year in reviewing the company's
present compliance systems and processes, which enabled them to conclude
that the company has initiated appropriate steps to address the cause of the
past civil violations and to mitigate any law enforcement concerns," BAE