The FCPA Blog

John Weston: BAE's former chief executive lied to the U.S. government about the company's compliance with the FCPA.At the heart of the DOJ's one-count criminal information that BAE pleaded guilty to on Friday is the al-Yamamah contract -- an $80 billion deal signed in the mid-1980s for the sale of jet fighters to Saudi Arabia. BAE won the contract by agreeing to pay bribes and kickbacks.

The DOJ said:

BAE agreed to transfer sums totalling more than £10 million and more than $9 million to a bank account in Switzerland controlled by an intermediary. BAE was aware that there was a high probability that the intermediary would transfer part of these payments to the [Saudi] official.

And this:

BAE took steps to conceal its relationships with . . . advisers and its undisclosed payments to them. For example, BAE contracted with and paid certain of its advisers through various offshore shell entities beneficially owned by BAE. BAE also encouraged certain of its advisers to establish their own offshore shell entities to receive payments while disguising the origins and recipients of such payments.

Despite the bribes and the elaborate money-laundering operation to conceal them, John Weston, BAE's chief executive, wrote a letter on November 16, 2000 to William Cohen, the U.S. Secretary of Defense. Weston promised that BAE was not knowingly violating the  Foreign Corrupt Practices Act and other antibribery laws. The letter is Exhibit A to the DOJ's criminal information.

*   *   *
If you haven't seen "Black Money," the PBS Frontline show examining al-Yamamah and the wider BAE scandal through the eyes and words of some of those involved, here it is. We think it's the best documentary about international corruption ever produced. There are great appearances by many, including David Leigh of the Guardian, who with colleague Rob Evans first reported the BAE scandal in 2003. Without their dogged work the story of BAE's corrupt practices may never have been told.