Court rules Government's termination of BAE investigation unlawful

By Agencies
April 10, 2008

The High Court this morning ruled that the Director of the Serious Fraud Office (SFO) acted unlawfully when he stopped a corruption investigation into BAE Systems' arms deals with Saudi Arabia.

The judgment was handed down by Lord Justice Moses and Mr Justice Sullivan in response to a judicial review brought by Campaign Against Arms Trade (CAAT) and The Corner House.

In the light of this judgment, the Serious Fraud Office must reopen the BAE-Saudi corruption investigation immediately. Both groups are calling upon the SFO to work jointly with US and Swiss investigators in doing so.

The judges detailed how BAE lobbied the Government by suggesting that the company would lose a large Saudi arms sale if the investigation was not dropped.

When the SFO was about to obtain access to Swiss bank accounts, Saudi Arabia threatened not only to cancel the arms deal but also to withdraw diplomatic and intelligence co-operation. This threat was made by Prince Bandar, who was allegedly complicit in the corruption under investigation.

The judges described the SFO Director's subsequent termination of the investigation on 14th December 2006 as a "successful attempt by a foreign government to pervert the course of justice in the United Kingdom".

In explaining their reasons for ruling in favour of The Corner House and CAAT, the judges found that the Director of the Serious Fraud Office had failed to exercise his independent judgment in halting the investigation. The Director had also failed to convince the court that he had done all in his power to resist the threat in order to uphold the rule of law.

The judges were also scathing about the Government's arguments for ending the investigation. "It is obvious . . . that the decision to halt the investigation suited the objectives of the executive. Stopping the investigation avoided uncomfortable consequences, both commercial and diplomatic" they said.

As to whether the SFO Director's action had broken the OECD's Anti-Bribery Convention, the judges concluded that the SFO Director should answer to the OECD's Working Group on Bribery.

Susan Hawley of The Corner House, said: "This is a great day for British justice. The judges have stood up for the right of independent prosecutors not to be subjected to political pressure. And they have made sure that the Government cannot use national security arguments just because a prosecution is not in their interests."

Symon Hill, spokesperson for Campaign Against Arms Trade (CAAT) said: "We are delighted. This judgment brings Britain a step closer to the day when BAE is no longer calling the shots. It has been clear from the start that the dropping of the investigation was about neither national security nor jobs. It was due to the influence of BAE and Saudi princes over the UK Government. As we have pursued this case, we have been overwhelmed by the support we have received from people in all walks of life, who do not want BAE to be above the law that the rest of us have to follow."

The judgment comes just weeks after the Government announced that it is planning to give the Attorney General the power to stop criminal investigations and prosecutions by citing "national security" without the decision being subjected to judicial consideration or meaningful Parliamentary oversight. In the light of today's judgment, The Corner House and CAAT insist that this proposed legislation, contained in the Constitutional Renewal Bill, must be abandoned.

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