Publication: Cape Argus Issued: Date: 2007-01-15 Reporter: Sapa Reporter:

'Middlemen Earned $12m over BAE Deal'

 

Publication 

Cape Argus

Date

2007-01-15

Reporter
Sapa-AFP

Web Link

www.capeargus.co.za

 

Tanzanians questioned about arms payments

Britain's biggest defence manufacturer, BAE Systems, paid a $12 million commission into a Swiss bank account to land a deal for a radar system in Tanzania, Britain's Guardian newspaper has reported.

Sailesh Vithlani, a Tanzanian middleman for the deal, admitted that the company had covertly paid him the sum, equivalent to about 30% of the total value of the contract.

The news comes as part of an investigation by Britain's Serious Fraud Office (SFO) into BAE's deals in Tanzania, about a month after the SFO was forced to abandon its investigation into corruption in BAE's military contracts with Saudi Arabia.

Tanil Somaiya, an associate of Vithlani, said British police had already flown to Dar-es-Salaam to interview both of them as potential witnesses.

He said BAE had set up dual arrangements with Vithlani and himself. The first involved a conventional 1% commission for acting as middlemen in the deal, which delivered a $40m military radar system *1 to Tanzania. Under the second arrangement, a BAE-owned offshore company, Red Diamond, paid an extra $12m to a bank ac-count in Switzerland under Vithlani's personal control.

Vithlani told the Guardian that he had made no disbursements from the Swiss bank account to public officials in Tanzania, and declined to comment when asked if he had given any to third parties outside the country. He said that he and Somaiya had answered all the questions put to them by the British police..

Citing unidentified investigators, The Guardian said that a payment equalling 30% of the total transaction, along with the use of Swiss bank accounts and dual arrangements, would normally provoke suspicions of bribery.

Asked by the Guardian why the company had made the $12m payment into Vithlani's Swiss bank account, BAE was quoted as saying: "We will not be commenting on any point of substance *2. This cannot of course be taken as any kind of admission."

The SFO also declined to comment when contacted by the Guardian.

Britain's Attorney-General asked the SFO drop its inquiry into an alleged slush fund maintained by BAE in its dealings with Saudi Arabia, after the kingdom was reported to have exercised pressure on Britain. This it had done by apparently warning it would take its business elsewhere, threatening British jobs *3. It had also reportedly threatened to cut diplomatic ties *4.

With acknowledgements to Sapa-AFP and Cape Argus.


*1       Shame - first BAE gets the natives to buy a US$40 million military radar for a civilian application where the latter would  cost a fraction of the former. Then they wack onto the total price US$12 million worth of wonga to splodge on the more elite of the natives. So a US$5 million necessary purchase becomes a US$40 million one.

But this is the way BAE and other European companies have been doing business in Africa and the Third World for the last 40 years.

Back home, a R4 billion fighter trainer requirement becomes a R15 billion trainer/light fighter requirement with the splodging of a mere 7% or R1 billion to the local natives.


*2      Yet just a few weeks ago the arrogant and suspect CEO Michael Turner, told the world via his PRO to "put up or shut up".

So The Guardian puts up a point of substance, only to get this beyond reasonable doubt response.

Only sentencing remains :
*3      That's why that other nincampoop, Tony Blair Esq, cited reasons of "national interest" in squashing the Saudi investigation. Forget about the UK's statutory obligation to the OECD Convention. If you don't like his principles he's got others.

It's enough to not only call for the barf bucket, but also consider handing back some of my DNA.

What are the alternatives?


*4      Now this is serious.

From where would Nincampoop Blair and his Master, Bat Boy Bush, launch their next Middle Eastern misadventure *5?


*5      Not to be be mistaken, I'm all for swotting the likes of Saddam Hussein off this fair earth, but do it properly *6.


*6      But sadly, I don't expect any time soon Bat Boy to be requesting my own advice and assistance.