Socialist Worker

Arms dealer BAE gets away with murder

Britain’s biggest arms company BAE has paid its way out of corruption charges. Simon Basketter looks at the crooks who let it off the hook

Issue No. 2188

The corrupt arms dealer BAE has always believed itself above the law – and proved on Friday last week that it is.

BAE paid a £288 million bribe to courts in the US and Britain to be let off, in its own words, “conspiring to make false statements... in connection with certain regulatory filings and undertakings”.

In the British settlement, the company admits to, “payments made to a former marketing adviser in Tanzania” in connection with an air traffic control system. The US settlement refers explicitly to paying bribes.

The deal means that investigations into BAE corruption in South Africa, Romania, Chile, the Czech Republic, Qatar, Bosnia, Nigeria, Zambia, Costa Rica and Egypt have now all been dropped.

As Socialist Worker reported last week, the Austrian Count Alfons Mensdorff-Pouilly faced trial for making “corrupt payments to unknown officials and other agents”. He has now escaped prosecution.

Mensdorff was BAE’s key secret agent in central Europe. He denied the accusations against him “wholesale.”

“BAE adopted and deployed corrupt practices to obtain lucrative contracts for jet fighters,” the Serious Fraud Office (SFO) told the courts.

It was a “sophisticated and meticulously planned operation involving very senior BAE executives”.

BAE conspired with Mensdorff and spent more than £10 million funding a bribery campaign in Austria, the Czech Republic and Hungary.

Mensdorff paid bribes “to public officials to favour BAE’s bids to supply Gripen jets”.

More than $17 million in total was transferred to Mensdorff, but all he officially did in return was produce “marketing reports”.

All charges against Mensdorff were dropped in the “public interest” – because of the BAE bribe deal.

The company has now admitted to one case of corruption – in Tanzania. In 2001 BAE sold Tanzania a £28 million air traffic control system. Even the World Bank said it was unnecessary and overpriced.

It was a high-tech military system – but Tanzania barely had an air force.

The deal was pushed through by then British prime minister Tony Blair. More than a third of the contract price went in bribes to Tanzanian officials.

As part of the settlement, further investigation into the air traffic control system will stop and the facts so far established will be kept secret.

BAE is the world’s third largest arms dealer. It makes fighter aircraft, warships, tanks, armoured vehicles, artillery systems, missiles, munitions and much more.


These arms are sold indiscriminately around the world and the company thrives on instability.

Its 2005 Annual Report candidly states that, “New threats and conflict arenas are presenting BAE Systems with new challenges and opportunities.”

The company claims to have military customers in “some 130 countries”.

BAE has sold sub-systems for Israeli F-16 fighter aircraft. It sold Hawk light combat aircraft to Indonesia during its repression of East Timor.

No one knows how many millions in bribes BAE paid – but we do know the merchants of death made almost £2 billion in profit last year.

BAE in numbers

  • £2 billion – BAE profits in 2009
  • £288 million – bribe paid by BAE to British and US courts
  • £28 million – cost of air traffic control system BAE sold to Tanzania
  • £10 million – BAE spend on bribery campaign in central Europe

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Article information

Tue 9 Feb 2010, 18:13 GMT
Issue No. 2188
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