The home secretary’s obstruction of justice over corruption inquiry

[Friday]

Someone’s obstrucing a criminal investigation.

Who could it be?

Well, it’s definitely not that new (ish) Home Secretary, Jacqui Smith, who is in charge of this sort of thing. We can rule her out, can’t we?

Oh, no. Actually, it is her.

British ministers are refusing to cooperate with the US criminal investigation into allegations of corruption against BAE, Britain’s biggest arms company, the Guardian can disclose.
More than two months after an official request for mutual legal assistance (MLA) was received from Washington, the home secretary, Jacqui Smith, has not yet allowed it to be acted upon. The US investigators believe the British are being obstructive.

But legal sources said yesterday that the inquiry team had not been deterred by the UK government’s hostile attitude. Some have already begun taking statements from key British witnesses.

How awkward. And King Abdullah’s visiting next month…

The formal request for assistance came from the US department of justice earlier in the summer, but Ms Smith has refused to pass it on to the Serious Fraud Office for processing in the normal way.

This is unusual behaviour towards a major ally, with whom legal cooperation is normally automatic. Last night, the Home Office said its failure to pass on the request was “not unprecedented”, but could not give any example of similar behaviour.

It’s not often that the British government refuses to co-operate with the US authorities. In fact, I think this is a first.

I wonder if the UK government will similarly refuse to co-operate with the US government in the coming war with Iran?

The SFO possesses important files on BAE gained from its own major inquiry into £1bn of payments to Prince Bandar of Saudi Arabia and other Swiss bank accounts linked to the Saudi royal family. But SFO investigators are not allowed to speak to US authorities until Home Office officials forward the paperwork.

The agency was forced to halt a criminal investigation earlier this year by the then prime minister Tony Blair, who said it threatened the national interest and was upsetting the Saudi regime.

National interest had to be the excuse, not “British jobs” (which we know the government doesn’t care about). Supposedly the Saudis would allow terror attacks to take place in the UK or against British forces in the Middle East…

Last week, Saudi Arabia signed a fresh arms deal with Gordon Brown’s administration worth up to £20bn for BAE’s Typhoon aircraft.

The Saudis had been threatening to withdraw from the contract.

The real motive for obstructing justice?

The government wants to secure BAE’s profits; it is the servant of big business. That’s why New Labour has kept secret the details of Thatcher’s al-Yamamah deal and is rather coy about when and where the latest deal took place. As for British jobs, a majority of the work will take place in Saudi Arabia. State monopoly capitalism, y’all.

Not all of BAE’s shareholders are happy at what’s going on, mind:

A fresh front against BAE was opened yesterday, when shareholders in the US launched a multimillion dollar lawsuit against the company’s directors accusing them of corruption. A spokesman for BAE, which is 50% owned by US shareholders and holds lucrative contracts with the Pentagon, said: “The company intends to vigorously defend any such proceedings.”

Prince Bandar, who is also named as a defendant, has not denied receiving cash and a free gift of an aeroplane, but he says it was for legitimate purposes.

Other defendants named in the US suit include former Conservative defence secretary Michael Portillo, who was given a post on BAE’s board after helping negotiate an arms deal with Qatar; Sir Nigel Rudd, who recently joined BAE’s board as a non-executive director; and Sir Dick Evans, the original architect of the £43bn al-Yamamah arms deal at the centre of the allegations.

The Washington claim has been made in the name of a small pension fund, the City of Harper Woods employees’ retirement system, which only holds the equivalent of 14,000 BAE shares, less than 1% of the company’s stock. But it is intended that other US shareholders will join in.

The suit claims that BAE’s directors have wrecked the company’s reputation and exposed it to heavy fines and penalties, by conniving at “improper and/or illegal bribes, kickbacks and other payments”, while claiming all the while in public that BAE was a “highly ethical, law-abiding corporation”.

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