Al-Yamamah, Britain’s largest-ever arms deal, clinched in 1985 with the help of Margaret Thatcher, and which generated £43 billion for BAE Systems, with another £40 billion in the offing, is just one example of the criminality in the arms industry. The Import, Export and Customs Powers (Defence) Act, 1938, gives enormous, scrutiny-free discretion to the Department of Trade and Industry (DTI) to promote the export of munitions to kill. With the encouragement of the arms industry, it even results in government officials being complicit in illegal acts that run contrary to Britain’s economic or foreign interests. False ‘end user’ certificates and third countries are used to conceal illegal weapons exports that include biological weapons and components for weapons of mass destruction.
In breach of law and riddled with corruption
The Al-Yamamah contract with Saudi Arabia provided for the supply of military hardware, including 120 Tornado planes, 60 trainer planes and 72 Eurofighter Typhoons. In breach of explicit law, it was riddled with corruption, which, it is alleged, the Ministry of Defence knew of and rubber stamped, and which BAE Systems did its best to conceal using, amongst other guises, offshore shell entities. Huge sums were spent buttering up Saudi government officials and the Saudi royal family, particularly Prince Bandar bin Sultan, son of the then Saudi defence minister. Due to the suppression of the National Audit Office’s conclusions to its investigation in 1992, these payments only came to light in 2001, when an ex-BAE Systems employee spilt the beans; but, significantly, nothing was done until the revelations became public in 2003.
In 2004 the Serious Fraud Office (SFO) launched an investigation into various allegations of bribery, contrary to Part 12 of the Anti-terrorism, Crime and Security Act 2001, in connection with the deal. These included payments to Prince Bandar of £1 billion and the gifting to him of an airliner by BAE Systems. However, BAE Systems promptly refused to comply with orders to produce details of its secret offshore payments to the Middle East. When, in 2006, the Swiss were about to disclose incriminating bank records to the SFO, the pressure for a cover up became immense. Ministers continued to mendaciously protest that the deal was clean, while BAE Systems and its lobbyists remonstrated that jobs would be lost. Simultaneously, the Saudis threatened to stop cooperating on countering terrorism (somewhat ironically, Osama bin Laden and the Al-Qaeda network were actually funded by corrupt plutocrats in Saudi Arabia, many of whom used British banks as financial conduits), raising the spectre of another 7/7 attack, and indicated they might take their next multi-billion pound aircraft order to France. While the SFO saw these threats as coming from Prince Bandar to conceal his corruption, Prime Minister Tony Blair, nevertheless, instructed his Attorney General, Lord Goldsmith, to end the SFO investigation.
Subsequently, the High Court of Justice ruled, in very emphatic and condemnatory terms, that terminating the SFO investigation had been unlawful; but the more compliant House of Lords overturned this. Since the UK had incorporated the OECD’s anti-bribery treaty into domestic law, it sent investigators to establish why no prosecution had been forthcoming; but to no avail. Fortunately, the US Department of Justice decided to launch its own investigation (in which, tellingly, the British government refused to cooperate), which led to an indictment for false accounting and making misleading statements, to which BAE pleaded guilty and paid the derisory fine of just £260 million for “deception, duplicity and knowing violations of law … on an enormous scale”. Then, to top the lot, in 2013, the SFO admitted losing 32,000 pages of data and 81 audio tapes linked to its stalled investigation into BAE System’s criminal conduct.
Why this criminality?
The extent of the complicity and duplicity of the British government in supplying arms to tyrannical regimes was revealed by Sir Richard Scott’s enquiry into the arming of the Iraqi regime. The government’s claimed ‘impartial stance’ with regard to the 1980-88 Iran-Iraq war was shown to be a deceitful ruse, as, for instance, the Export Credits Guarantee Department would only cover exports to Iraq and not Iran.
In general arms exports are not particularly profitable and security justifications are suspect. However, jobs that derive from the industry account for part of its supposed importance, as does the desire of Britain to ‘punch above its weight’ globally and, thereby, maintain its position as one of the five members of the UN Security Council. The huge profits that can be made by arms companies are, nevertheless, an important driver. By supplying Saddam Hussein’s regime with arms in 1988/9, before he became the West’s bogeyman, Matrix Churchill turned round its persistent losses over the previous decade, returning a profit of £2.4 million for that year.
This disgraceful global trade by Britain continues. According to research by Campaign Against Arms Trade, Britain has licensed £4 billion of arms sales to the Saudis since 2010. In 2016, 22 Hawk jets, in a deal worth £1.6 billion, will be delivered. The Stockholm International Peace Research Institute estimates that the U.K. is now Saudi Arabia’s largest arms supplier, responsible for 36% of all its arms imports.
Since Britain is the world’s second biggest arms exporter and has, for example, contributed to ensuring the now anarchic and destabilised Middle East is awash with arms, it is absolutely vital this criminality is brought to an end without further obstruction and delay.