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BAE Systems faces bribery charges BAE Systems faces bribery charges
(18 minutes later)
BAE Systems, the UK's biggest manufacturer, is facing bribery charges and a possible confiscation of between £500m and £1bn, the BBC understands. BAE Systems, the UK's biggest manufacturer, is facing bribery charges the BBC has learned.
The Serious Fraud Office (SFO) is expected to announce later that it wishes to prosecute defence giant BAE Systems for alleged bribery. The Serious Fraud Office (SFO) will announce later that it has reached no agreement with the firm, and will ask the Attorney General to prosecute BAE.
The case refers to allegations the UK firm paid out millions of pounds to win contracts from a number of countries. The case refers to allegations BAE paid millions of pounds to win contracts from several countries. It may face confiscation of between £500m and £1bn.
BAE admitted last year that it had not always met the top ethical standards.BAE admitted last year that it had not always met the top ethical standards.
A separate investigation into BAE by the SFO was dropped in 2007 after it was decided that national security was at risk.A separate investigation into BAE by the SFO was dropped in 2007 after it was decided that national security was at risk.
In that case, the SFO ended its investigation into a giant 1980s arms deal BAE secured from Saudi Arabia.In that case, the SFO ended its investigation into a giant 1980s arms deal BAE secured from Saudi Arabia.
'Explosive investigation''Explosive investigation'
Whether you love or hate that BAE is a world leader in defence, it is the biggest manufacturer in the UK and is a significant part of the British economy Robert PestonBBC Business Editor Read Robert's blogWhether you love or hate that BAE is a world leader in defence, it is the biggest manufacturer in the UK and is a significant part of the British economy Robert PestonBBC Business Editor Read Robert's blog
The latest SFO investigations are into contracts BAE won from countries including Tanzania, the Czech Republic, Romania and South Africa.The latest SFO investigations are into contracts BAE won from countries including Tanzania, the Czech Republic, Romania and South Africa.
BBC business editor Robert Peston said the continuing probe was "the most explosive investigation into a British company that I have ever encountered".BBC business editor Robert Peston said the continuing probe was "the most explosive investigation into a British company that I have ever encountered".
He added that, while BAE would like to settle the case through a plea bargain, its management had a legal duty not to hand over cash or damage the reputation of the firm unless they were advised by their own lawyers that the SFO had an overwhelming case.He added that, while BAE would like to settle the case through a plea bargain, its management had a legal duty not to hand over cash or damage the reputation of the firm unless they were advised by their own lawyers that the SFO had an overwhelming case.
THE STORY SO FAR... Allegations that BAE contracts have been won through bribery payments are not newThe biggest probe focused on a £43bn contract to supply more than 100 fighter jets to Saudi Arabia. The deal began in 1985 but a National Audit Office investigation was suppressed in 1992The SFO launched an investigation in 2004 into the allegations - including BAE running a "slush fund" that offered sweeteners to Saudi royals and their intermediaries in return for lucrative contractsThis was dropped two years later by Tony Blair after political pressure from the UK and Saudi Arabia. BAE always denied any wrongdoingTHE STORY SO FAR... Allegations that BAE contracts have been won through bribery payments are not newThe biggest probe focused on a £43bn contract to supply more than 100 fighter jets to Saudi Arabia. The deal began in 1985 but a National Audit Office investigation was suppressed in 1992The SFO launched an investigation in 2004 into the allegations - including BAE running a "slush fund" that offered sweeteners to Saudi royals and their intermediaries in return for lucrative contractsThis was dropped two years later by Tony Blair after political pressure from the UK and Saudi Arabia. BAE always denied any wrongdoing
The BBC understands that any deal would involve BAE pleading guilty to charges of corruption and agreeing to pay a substantial sum in compensation - between £500m and £1bn. The BBC understands that the SFO wanted to strike a deal that would involve BAE pleading guilty to charges of corruption and agreeing to pay a substantial sum in compensation - between £500m and £1bn.
However this does not appear to have happened.
Criminal charges would be brought under the 2001 Prevention of Corruption Act, but conviction would be decided by a judge without needing a crown court trial in front of a jury, he added.Criminal charges would be brought under the 2001 Prevention of Corruption Act, but conviction would be decided by a judge without needing a crown court trial in front of a jury, he added.
A final decision on whether to proceed with criminal proceedings will have to be made by the Attorney General Baroness Scotland.A final decision on whether to proceed with criminal proceedings will have to be made by the Attorney General Baroness Scotland.
A BAE spokesman said the firm was working with regulators to help bring the investigation to an end, "providing access to people, information and premises whenever requested".A BAE spokesman said the firm was working with regulators to help bring the investigation to an end, "providing access to people, information and premises whenever requested".
The firm is the UK's largest manufacturer - making everything from British Army kit to warships and planes. It has about 105,000 employees worldwide, including about 32,000 in the UK with customers in more than 100 countries.The firm is the UK's largest manufacturer - making everything from British Army kit to warships and planes. It has about 105,000 employees worldwide, including about 32,000 in the UK with customers in more than 100 countries.
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