How BAE Got Caught

Investigative reporters may be disappearing from newsrooms everywhere, but they still have an important role to play in holding institutions and people accountable for overseas bribery. Rob Evans of the U.K. Guardian contributed an essay to TI’s Global Corruption Report 2009 here. It’s about how he and David Leigh broke the BAE story. Their investigation wasn’t quick or easy, and not many news organizations these days would have let the story play out the way the Guardian did. But the paper supported its reporters and with time and luck (which came in the form of a couple of well-placed whistleblowers) one of Britain’s biggest commercial scandals made it into public view.

Here’s part of what Rob Evans had to say:

. . . My experience of working with David Leigh on the Guardian investigation that led to the exposure of the BAE Systems scandal in the United Kingdom is illustrative of the challenges that journalists face in investigating corruption. The articles we wrote prompted the Serious Fraud Office (SFO) to launch an investigation into allegations that BAE Systems, the United Kingdom’s biggest arms company, had paid bribes to win contracts from Saudi Arabia and other governments. Tony Blair’s government eventually stepped in and stopped the SFO from completing its investigation into the allegations in December 2006. . . .

The investigation into BAE System’s payments began in late 2002. Over three days in June 2003 the Guardian published articles into alleged bribery in the Czech Republic, India, Qatar and South Africa. A few weeks later whistleblower Edward Cunningham contacted the Guardian with new allegations of a slush fund that BAE Systems was using to bribe and “sweeten” Saudi officials connected to a huge arms contract. Cunningham spoke out because he was appalled by what he had seen. Those articles in September 2003 reported that BAE Systems was allegedly providing prostitutes, sports, cars, yachts, first-class plane tickets and other inducements. . .

During our investigation we faced a number of challenges. One of the most acute was the difficulty in penetrating the banking system to find out how BAE Systems had made its allegedly corrupt payments. The money flowed from the United Kingdom to the tax haven of the British Virgin Islands to Switzerland and onwards – to the Czech Republic, Romania, Qatar, Tanzania, South Africa and Chile. . . . As the number of investigations expanded around the world, so did the leaks, and slowly a picture of the payments began to emerge. We were working with reporters in other counties who were better placed to find out what was going on in the investigations in their countries and share information with us.

. . . Journalists aiming to expose corruption also need to be persistent. They need time to dig around — to go and see people who may have information, to look through archives, read long reports to retrieve vital pieces of information buried deep within them, and so forth. Often reporters are prevented from doing this, however, as the media owners are far more interested in celebrity stories, or their next set of profits. For many editors, exposing the dry details of how improper payments have been laundered through bank accounts is, quite simply, less exciting than Britney Spears’ latest antics. Many people believe that reporters are now being given less time to investigate stories over an extended period. This is a problem that afflicts reporters in developed countries, and it is even more so for journalists in developing countries. . . .

Read all our posts about BAE here.
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