The Serious Fraud Office (SFO) is to face legal action over its decision to reach a 'plea bargain' with the multinational arms company BAE Systems.
The SFO dropped multiple corruption investigations into BAE in return for an admission of accounting irregularities and a payout of £30 million. But the Campaign Against Arms Trade (CAAT), acting along with anti-corruption campaigners The Corner House, say that the firm has been let “off the hook”.
The two groups announced yesterday evening (12 February) that lawyers acting on their behalf had begun proceedings. They are requesting a judicial review – a process whereby a court rules on whether a public body, in this case the SFO, has acted unlawfully.
Their lawyers argue that the SFO failed properly to apply its own guidelines and that the plea bargain does not reflect the seriousness and extent of BAE's alleged offending.
This is the second time that the authorities have faced legal action of their lenient treatment of BAE. In 2006, Tony Blair’s government pressured the SFO into dropping a major inquiry into BAE’s arms deals with Saudi Arabia. A judicial review brought by CAAT and The Corner House resulted in the High Court declaring that the government and SFO had behaved illegally.
The ruling was later overturned by the law lords, but it was widely thought that the outrage and publicity that the issue had generated made it impossible for the SFO to behave the same way again.
However, although a BAE payout has been required on this occasion, it was described by CAAT as a “tiny sum” in proportion to BAE’s profits.
“The SFO plea bargain is unlawful,” said CAAT’s Kaye Stearman yesterday, “Investigations into alleged corruption in at least three countries have simply been dropped. It is in the public interest that BAE should not be let off the hook.”
The SFO had been investigating allegations of bribery and corruption in relation to BAE deals with South Africa, Tanzania, Romania and the Czech Republic. Although their admission of a criminal charge of accounting irregularities relates to deals with Tanzania, the SFO has agreed to abandon the other inquiries as well.
“Plea bargains should only ever be entertained when companies have really come clean,” said Nicholas Hildyard of The Corner House, “BAE has not. Once again, an SFO decision has reinforced the UK's reputation for letting big companies get away with bribing. Once again, it has shown a blatant disregard for the rule of law.”
CAAT are encouraging anyone who shares their disapproval of the SFO's decision to sign the statement at http://www.caat.org.uk/issues/bae/statement.