Best practice & Ethics
OECD critical of decision to drop SFO BAE inquiry
The Organisation for
Economic Co-operation and Development (OECD) has raised “serious concerns”
about the decision of the UK government to drop a
Serious Fraud Office (SFO) investigation
into alleged bribery by arms manufacturer
BAE Systems.
The SFO was probing allegations BAE used slush funds in
obtaining an arms contract with Saudi Arabia, but the inquiry was abandoned as a
result of political pressure. The
OECD
working group on bribery said it was examining whether this decision was
consistent with the
OECD
anti-bribery convention.
It will discuss the issue further in March. The
prime minister, Tony Blair, has come under pressure to reverse the decision.
Lobbying groups, Campaign Against the Arms
Trade and The Corner House
have mounted a legal challenge while over 140 UK and international non-governmental organisations
wrote
to Blair urging the government to reconsider reopening the case.
Meanwhile, the attorney general Lord Goldsmith revealed that the government
was, as early as December 2005, placing pressure on Robert Wardle, director of
the SFO, to drop the investigation into BAE Systems.
Answering
parliamentary questions, Goldsmith said the prime minister and then foreign
and defence secretaries had raised concerns with him about the public interest
considerations of the investigation, which he had then relayed to the SFO.
However, Goldsmith stressed, no minister, apart from him and the
solicitor-general, ever made direct contact with the regulator and the decision
to drop the probe was made solely by the SFO.
Writing in the Financial Times (22 January),
Michael Peel argued the UK has set a potentially self-destructive precedent by
so publicly caving into diplomatic blackmail. Furthermore, said Peel, the
problem of international credibility has commercial implications, and pension
fund Hermes has warned the abrupt closure of the BAE investigation threatens the
country’s standing as a leading financial centre.
Links
Organisation for
Economic Co-operation and Development
Serious Fraud Office
BAE Systems
OECD
Working Group on Bribery
OECD
Anti-bribery Convention
Campaign Against the Arms Trade
The Corner House
NGO
Letter to Prime Minister
Written Parliamentary Answers
Financial Times
February, 2007 |
