Al-Yamamah

Al-Yamamah ("the Dove" in Arabic) was the series of government-to-government arms agreements between the United Kingdom and Saudi Arabia, with British Aerospace (later BAE Systems) as prime contractor. The first agreement was a Memorandum of Understanding signed at Lancaster House on September 26, 1985 by the Secretary of State for Defence, Michael Heseltine, and the Saudi Defence Minister, Prince Sultan bin Abdulaziz. It covered 72 Tornado aircraft and 30 Hawk trainers, among other equipment. Two further, more detailed agreements followed in 1986 and 1988, and the programme was extended in 1993 by an order for 48 more Tornados.¹²

The Riyadh visit of April 1985

Foreign Office files released to the National Archives and reported in 2016 record that Margaret Thatcher stopped in Riyadh in April 1985 on her way back from South Asia and met King Fahd. Heseltine approved the stop-over on the basis that it would allow her to complete the sale, and Prince Bandar bin Sultan, then Saudi ambassador to the United States, invited her. A briefing document stated that it "seems unlikely that Prince Bandar would seek to engineer such a meeting unless something positive was likely to come out of it." The official record of the meeting was billed as one about regional developments and does not mention the aircraft. After the visit Thatcher wrote to Fahd: "I was glad that we were able to discuss a further matter privately over lunch. I look forward to receiving your majesty's personal envoy soon, in order that we may conclude this matter successfully."³

The released papers of 2006

The Guardian published in October 2006 documents that had been released to the National Archives in May of that year and were withdrawn by the Ministry of Defence after the paper approached it. One was a January 1986 telegram from Colin Chandler, head of the Ministry's arms sales unit, who was in Riyadh with BAE executives. The Guardian reported from it that the price of each Tornado had been raised by 32 percent, from £16.3 million to £21.5 million, and that the total was to reach £5 billion against the £3.5 billion to £4 billion stated in the Memorandum. The same release contained a Ministry of Defence briefing prepared for Thatcher that described Prince Sultan as "not highly intelligent," and Foreign Office correspondence of 1985 sending Thatcher's chief aide at Number 10, Charles Powell, a copy of an Arab magazine that alleged £600 million in secret commissions, with advice that officials "should simply refuse all comment."¹ Lord Gilmour, who had been a minister under Thatcher, told BBC2's Newsnight, as the Guardian quoted him: "You either got the business and bribed, or you didn't bribe and didn't get the business."¹ The Guardian also wrote that all those involved had always denied the allegations of secret commissions.¹

The National Audit Office report of 1992

In 1992 the National Audit Office reported on the Saudi Arabian Airforce Project. Its examination of project receipts and payments passing through the Ministry of Defence "found no evidence of commission payments being made to third parties." On February 27, 1992, in a private session of the Public Accounts Committee, whose chairman was Robert Sheldon, the Ministry's permanent secretary, Sir Michael Quinlan, said: "The whole project operates under a seal of confidentiality. There is a very great sensitivity about the project on the part of the Saudi Arabian Government. Open Government is alien to them." Asked for an assurance that no public funds had gone the wrong way, Quinlan answered: "Yes, I can give you the assurance that there is no basis to support any suggestion that commission payments have been made using public funds."⁴ The report was not published. The Guardian reported in March 2024, after finding the papers in Sheldon's archive at the London School of Economics, that only ten copies were printed and that only Sheldon and his deputy read it. The Guardian also reported that a Ministry memorandum disclosed at a later criminal trial showed that in 1988 the Ministry's head of arms sales had helped set up regular quarterly payments to Prince Bandar from Al-Yamamah funds, which BAE made on the Ministry's instruction. BAE said all payments were made with the express approval of the United Kingdom government, and the Ministry said the funds remained the property of the Saudi government.⁵

The Commons speech of January 1996

On January 24, 1996, in a Commons adjournment debate on Saudi Arabia, George Galloway told the House that the contract "was landed by British Aerospace as a result of corruption on an unprecedented scale," and that "enormous bribes and commissions of up to 30 per cent. of the multi-billion pound deal were paid," shared between the Defence Minister, Prince Sultan, his family, and the sons of King Fahd, "notably Prince Mohammed." He said a "whole gang of middlemen" in London made millions of pounds in pay-offs, among them Wafic Said, whom he described as a business partner of Jonathan Aitken, and Mark Thatcher, "the son of the then Prime Minister, who gave 10 Downing street as his address at the time, but who was later given his own house and other lavish benefits by Wafic Said and who has become mysteriously and inordinately rich." He said that some of the secret commissions had been handled by British Aerospace through a British businessman, Douglas Leese, and that the National Audit Office report of Sir John Bourn had been "suppressed by the Select Committee on Public Accounts for more than three years." He also described Colonel Thomas Dooley, an executive of Sikorsky, as testifying in a United States court that Prince Bandar told him what bribes must be paid in a "competition for bribes" over Black Hawk helicopters.⁶

The writer Paul Foot wrote in 1998 that it had become "common knowledge" that Mark Thatcher enriched himself by £12 million from the Al-Yamamah deals, that Thatcher himself never denied it or sued anyone for mentioning it, and that no one, including the authors of a book on the subject, could produce a single hard fact to prove it.⁷

The Serious Fraud Office investigation, 2004 to 2006

The Serious Fraud Office launched an investigation into allegations of corruption against BAE on July 29, 2004, one aspect of which concerned Al-Yamamah. By autumn 2006 it intended to examine Swiss bank accounts, and the judgment of the House of Lords records that the Saudi authorities responded with an explicit threat to withdraw from bilateral counter-terrorism cooperation, to withdraw cooperation on the United Kingdom's strategic objectives in the Middle East and to end negotiations then in progress for the purchase of Typhoon aircraft. The ambassador to Saudi Arabia, Sir Sherard Cowper-Coles, told the Director that "British lives on British streets were at risk." The Prime Minister, Tony Blair, sent the Attorney General a personal minute on December 8, 2006.⁸

On December 14, 2006, the Attorney General, Lord Goldsmith, told the Lords that the Director of the Serious Fraud Office had decided to discontinue the investigation "following representations that have been made both to the Attorney General and the Director concerning the need to safeguard national and international security." He said he had obtained "the views of the Prime Minister and the Foreign and Defence Secretaries," who had expressed "the clear view that continuation of the investigation would cause serious damage to UK/Saudi security, intelligence and diplomatic co-operation."⁹

Judicial review

The Corner House and Campaign Against Arms Trade challenged the decision. The Divisional Court quashed it on the ground that the Director had yielded to a threat. On July 30, 2008, the House of Lords allowed the Director's appeal in R (Corner House Research) v Director of the Serious Fraud Office, holding the decision lawful. Lord Bingham wrote that what determined the decision was "the Director's judgment that the public interest in saving British lives outweighed the public interest in pursuing BAE to conviction."⁸

BAE Systems plea of 2010

On March 1, 2010, BAE Systems pleaded guilty in the United States District Court for the District of Columbia to conspiring to defraud the United States by making false statements about its Foreign Corrupt Practices Act compliance program and to violating the Arms Export Control Act, and was fined $400 million by Judge John D. Bates. The Department of Justice stated that BAE took the role of prime contractor to the United Kingdom government in the mid-1980s after the formal understanding with Saudi Arabia, that its "support services" resulted in substantial benefits to a foreign public official of Saudi Arabia who was in a position of influence over sales of fighter jets, and that BAE undertook no adequate review or verification of more than $5 million in invoices submitted by one employee from May 2001 to early 2002.¹⁰