DEFENCE - Corruption

US extends BAE corruption probe

The United States Department of Justice is extending a corrruption probe into a 54-billion-euro arms deal between BAE, the UK's largest defence firm, and Saudi Arabia in the 1980s.


The United States is seeking to question more employees of BAE Systems after already quizzing two senior executives in a corruption probe, Britain's largest defence firm said Tuesday.

"The company confirms that last week the (US Department of Justice) issued a number of additional subpoenas in the US to employees of BAE Systems plc and (its US subsidiary) BAE Systems Inc as part of its ongoing investigation," it said in a statement.

"The company has been and continues to be in discussion with the DoJ concerning the subpoenas served in the course of its investigation."

The US Department of Justice is probing allegations that illegal payments were made to Saudi officials to help BAE Systems secure a 43-billion-pound (54-billion-euro, 84-billion-dollar) arms deal in the 1980s.

BAE confirmed Monday that its chief executive, Mike Turner, was briefly detained as he arrived in Houston, Texas, while non-executive director Nigel Rudd was held on arrival at Newark, New York.

Both were released after being questioned and having documents and personal electronic equipment -- including laptops and Blackberry electronic organisers -- examined.

The British government said in December 2006 that the Serious Fraud Office (SFO) was dropping its own probe into the claims, citing national security concerns and potential damage to relations with the oil-rich Gulf state.

London's High Court has since ruled that the SFO acted unlawfully in abandoning the case. The US authorities have pressed ahead with their inquiries.

Daily newsletterReceive essential international news every morning