British defense industry may lose billions of dollars worth of work if the Saudi royal family is embarrassed by a Serious Fraud Office investigation into an alleged “slush fund”, The Sunday Times reported. The Saudi authorities have warned London that British firms will receive no further contracts if any member of the royal family is embarrassed by the investigation into alleged accounting irregularities in contracts between BAE Systems, Britain’s largest defense contractor, and two travel agency firms.
According to the report, BAE Systems is alleged to have footed £17 million of expenses run up by Prince Turki bin Nasser, the Saudi minister responsible for negotiating arms purchases from Britain, including the cost of private jets and paying for grand suites in luxury hotels.
Documents seized by the British Ministry of Defense police indicated that the “slush fund” amounted to £60 million.
The warning from the Saudis threatens two large contracts currently under negotiation, defense industry sources were quoted as saying by the Times. These are a £1.4 billion upgrade to the Saudi air force’s fleet of British-made Tornado fighter bombers and a £3 billion-plus deal to sell the Saudis the new Eurofighter Typhoon combat aircraft.
The travel agencies were allegedly used to provide benefits to Saudi defenSe officials linked the al-Yamamah contracts, two massive arms deals under which BAE Systems supplied aircraft and continuing support to the kingdom of Saudi Arabia. (menareport.com)