Reports: Saudi Prince Got More Than $1 Billion in Deal

The BBC and The Guardian report today that a British arms company secretly paid more than $1.5 billion over a decade to Saudi Prince Bandar bin Sultan in connection with a defense contract with the Gulf nation that was the largest in British history.

The reports claim BAE paid the money with the knowledge of British Defense Department officials -- despite their denials that they knew of such an arrangement. The payments were written into the arms contract in secret annexes, described as "support services," according to BBC TV's Panorama.

The Guardian reports that a series of payments was channeled through a U.S. bank in Washington to an account controlled by Bandar, who was the Saudi ambassador to the U.S. for more than 20 years. Bandar has denied that the payments were improper and said that BAE acted lawfully at all times.

The War In Context blog writes that Americans need to pay attention to this story because: " ... BAE North America has directors including the likes of 9/11 Commission co-chairman, Lee Hamilton. With its open access to the Pentagon, BAE should be seen as a supra-national corporate entity that can strut through the corridors of political power with supreme confidence ... BAE is certainly one of the big winners in the war on terrorism."

Last November, The Times of London reported that the Saudi government told British officials that if the Serious Fraud Office continued to investigate the arms deal, it would stop cooperating with British intelligence on terrorism issues and would end the deal, meaning the loss of thousands of British jobs. The Blair government stopped the investigation. The head of the SFO told The Guardian today that he also had made the decision to withhold information about the payments to the prince from an international anti-corruption investigation "to protect national security."

3:56 PM ET | 06- 8-2007 | permalink