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back to article BAE broke bribery pledge, faked US arms-export applications

Further details have emerged regarding the US Department of Justice case against UK-headquartered arms globocorp BAE Systems. The feds - without argument from BAE - say that the company engaged in a "conspiracy" to violate several US laws in recent years. In particular, the Justice department alleges that BAE broke a promise …

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Welcome

Can I be the first to welcome our

"They may be crooks but they're our crooks and the foreigners are worse" posters?

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Just my opinion...

If the US government didn't upset the commercial balance of the market by enacting the protectionism of diverting all their contracts to Boeing, maybe other competing companies wouldn't have to do things like this to survive.

No, I've got no plans to ever set foot in the USA.

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WTF?

Someone fill me in please...

Why was BAE involved in the sale of Gripens to the Czech rebulic? The Gripen is manufactured and sold by Saab Aerospace which unless i happen to have missed something is not and has never been a BAE subsidiary. Were BAE acting as a sales rep for some reason?

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Someone fill me in please..

Saab formed a joint company with BAe to sell the Viggen abroad - in order to take advantage of BAes extensive experience of global marketing ,<cough> it's supply of cash filled brown envelopes</cough>

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Anonymous Coward

So they pay one bribe...

...get caught, then pay another bribe, er, I mean fine? Justice indeed.

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excellent work

congratulations to the DoJ and associated entities. SFO, CPS - this is how to run a bribery of foreign officials investigation. Richard Alderman's approach is a dog turd.

http://www.telegraph.co.uk/finance/comment/alistair-osborne/7169390/The-big-game-hunter-of-the-SFO-loses-his-prey-in-the-African-wilderness.html

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Anonymous Coward

And no-one goes to prison?

Hmm. That points to a higher level cover-up, methinks.

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Happy

@Michelle Knight

'If the US government didn't upset the commercial balance of the market by enacting the protectionism of diverting all their contracts to Boeing, maybe other competing companies wouldn't have to do things like this to survive."

You being like AIrbus gets help. Oh and the US has used Air bus for government work. look at who is building air force two.

Oh I don't get it A US government Demanding a US company for government work. Work that involves classified items . Lets see when Airbus one the contract for airforce one it has to be built in the US for security reasons . Hmm would you be ok if lockheed took over the British defense industry and buil every thing here in America ?

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Anonymous Coward

Tornado f3

'The last time BAE made a jet on its own it produced the Tornado F3, the laughingstock of the fighter world'.

At least it flew with a radar installed. The earlier Tornado F2 fighter had a large lump of hi tech concrete in the nose owing to a total cock up on the radar design front. Oh how the Russians must have trembled in fear when they found out.

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FAIL

excellent work - in pursuing your own self interests

"congratulations to the DoJ and associated entities. SFO, CPS - this is how to run a bribery of foreign officials investigation."

I'm sorry, I almost fainted when I read that. Are you really so naive as to believe that Lockheed-Martin or Boeing would be investigated by the DoJ for similar offences, or that Dassault in France would be investigated by the French government? Sarkozy is the chief cheerleader for their products - recently in Dubai and Brazil.

Maybe the reason why the US companies don't need to use 'corrupt' practices is because they already own large swathes of the US Senate and Congress.

http://thecaucus.blogs.nytimes.com/2010/02/05/white-house-blasts-shelby-hold-on-nominees/?hp

It's easy to appear whiter than white when you write the rules of the game.

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FAIL

perhaps your dizziness is affecting your reasoning.

"are you really so naive as to believe that Lockheed Martin or Boeing would be investigated by DoJ for similar offences..."

Well, goggyturk, it's funny you should mention Lockheed Martin. LMCO's notorious use of a former CIA spy and gangster to bribe Japanese public officials in the 1970s was actually one of the main drivers for getting the FCPA onto the statute books: http://en.wikipedia.org/wiki/Lockheed_bribery_scandals#Aftermath

And in fact if there's one company that consistently fails to learn from its FCPA prosecutions, it's LMCO. Lockheed seems to land in the defendant's seat every few years, in fact:

1979: http://www.justice.gov/criminal/fraud/fcpa/append/appendixa.html

1994: http://www.justice.gov/criminal/fraud/fcpa/append/appendixa.html (further down)

1996: http://triangle.bizjournals.com/triangle/stories/1996/08/05/smallb10.html

2003: http://fcpablog.squarespace.com/blog/tag/california

In fact, if you read through that DoJ page above that gives some FCPA prosecutions data, you'll notice that the vast majority of the firms prosecuted are US firms. I'm afraid if you're looking for US DoJ bias towards US firms and using Lockheed (the most notorious pre-Siemens FCPA violator) as your example, it probably shows you don't know that much about the subject.

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Anonymous Coward

Cost plus

BAe have never really got to grips with life after cost-plus. Its still ingrained in the company - the attitude that come what may, we deserve our profits. As a direct result of that you end up with piss-poor project management and crappy products.

Anyway I can't see them getting any significant future orders in the USA, European companies didn't trust B.Ae before all this and the UK is bankrupt*. What goes around comes around.

*so is the USA but their currency is the petrochemical currency of choice - for now.

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Anonymous Coward

Naming conventions

Why is it that all chairmen of BaE are Dicks?

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Mr

In the last few years, the US, Germany and France have prosecuted over 200 companies for international bribery and corruption, this includes numerous key US companies such as Boeing where the Chief Financial Officer went to prison, Lockhead, McDonald Douglas, Haliburton, and KBR to name just a few . The German and US governments last year each fined Siemens $800 million plus criminal prosecutions. A simple check will give more info into the other prosecutions. . In the last couple of weeks the FBI have arrested 22 arms dealers in a bribery sting including 4 Brits. British aircraft such as the Tornado and Eurofighter contain thousand of US components and software elements, aircraft sales have to be given US government approval before being sold. Britain is also signatory to the OECD anti bribery convention and in the 10 years this has been in force the UK brought its first case last year. BAE was being investigated in 12 countries but that's all gone away now, just a slapped wrist a £30 million fine for "accounting irregularities" after all what is a few £ billions in bribes, it protects British jobs although 70% of BAE employees are overseas. In the US BAE pleaded guilty. This saga has been publicised world wide for the last 6 years, the damage done to Britain's reputation is massive which has been acknowledged by numerous British organisations and companies who genuinely avoid bribery and corruption but as one leading company chairman commented when he referred to potential set backs affected by cynicism and suspicion. Now that really costs British jobs and respect. Do any moral issues apply?

BAE/Saab in 1995, Saab Military Aircraft and British Aerospace or BAe (now BAE Systems) formed the joint venture company Saab-BAe Gripen AB, to market the Gripen fighter world wide.

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This Lockheed?

"From nuclear missiles to fighter planes, software code to spy satellites, the Patriot missile to Star Wars, Lockheed has come to dominate the weapons market in a way that the Standard Oil Company used to hold sway over the nation's petroleum supplies. And it all happened with the help of the federal government, which steered lucrative no bid contracts Lockheed's way, enacted tax breaks that encouraged Lockheed's merger and acquisition frenzy in the 1980s and 1990s and turned a blind eye to the company's criminal rap sheet, ripe with indiscretions ranging from bribery to contract fraud."

http://www.counterpunch.org/stclair01222005.html

Sounds like the US government has a vested interest in Lockheed's success to me. This is a company that has a track record of alleged bribery going all the way back to the 'sale of the century' fighter contest in the late 1950s at least, which ended with the deaths of hundreds of European pilots killed in accidents in the F-104 Starfighter.

As for the Boeing case, prosecution occurred because of a breach of protocol (the rules of the game) that was so flagrant that the authorities were forced to act. Well, that and the waste of hundreds of billions of taxpayer dollars and the protests of Northrop Grumman, another part of the military-industrial establishment.

As I said above, what's good for the goose is good for the gander. US laws exist to protect US self interest.

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Ah, the F-104G*

Which gave rise to the famous old joke: "If you want to buy a Starfighter, it's cheaper to buy a piece of Germany and wait."

* "G for Germany!". +1 internets to anyone who gets the reference.

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Lockheed. Whoever won the contest

They ended up building the vehicle. Suntan, F104, and the whole "Slush fund" business in the 1970s, when the King of the Netherlands ended up in the dock.

BTW saw a documentary on the F35. Lockheed had "lost" c$60m in an accounts situation. Normally grounds for being dumped off a US Gov contract. Then it looked like they might not make the fly off. Except Boeing got hit by a strike and the Pentagon extended the deadline for both.

What a truly *amazing* bit of luck that was.

BAe *always* play the patriotism card in the UK. I recall a study that reckoned defense indsutry jobs are the highest cost, lowest number of people employed use of government cash anywhere.

If their products are *so* British, why do they keep *needing* US government sales approval?

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FAIL

It's BAE, people!

<pedant>

BAE Systems is shortened to BAE, not BaE, BAe or British Aerospace. It's been that since about 1999 and the press still can't get it right.

</pedant>

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