Euro Artikelen over exportkredietverzekeringen

Scandal as Navy gets GBP 200,000 for 2 frigates
that were worth GBP 116m

The Express, 3 november 2006, Gabriel Milland

FRAUD squad police are investigating how two Royal Navy warships were sold for scrap to a major British company at GBP 100,000 each.

For, shortly afterwards, the frigates were sold on again for a staggering GBP 116million - to the Romanian navy, it emerged lastnight.

Now the Serious Fraud Office and Ministry of Defence Police are inquiring into the deal, which saw arms giant BAE net almost 600 times its investment.

Tories, Liberal Democrats and a leading taxpayer group condemned the sale to notoriouslycorrupt Romania.

Shadow Defence Secretary Liam Fox said someone had "clearly been playing fast and loose with taxpayers' money." He added: "This warrants a serious investigation by the National Audit Office to find out where the blame lies for this scandalous waste of public funds."

Nick Harvey, Lib Dem defence spokesman, said: "These disclosures raise more questions than they answer. What is needed is full transparency." Matthew Elliott, chief executive of Government watchdog the TaxPayers' Alliance, said: "This is astounding. There is either massive incompetence at selling the ships so cheaply or, more likely, some very murky deals which have resulted in taxpayers being robbed of GBP 116million.

"The Ministry of Defence must do everything within its power to make sure that anyone who might have feathered their nests at the taxpayers' expense are dealt with properly." The frigates HMS Coventry and HMS London were 13 and 14 years old when they were sold to the Romanian Navy in 2003.

In a Commons written answer to Tory MP John Hayes yesterday, Armed Forces Minister Adam Ingram said the ships "required major regeneration and modernisation work as they had been out of service for some time." But Romanian police are believed to be investigating whether a GBP 7million kickback was paid to Romanian officials.

Romania's anti-corruption squad raided the Bucharest office of a BAE agent in June this year. Romanian officials have claimed that BAE paid the alleged bribe to an offshore account in Guernsey.

The MoD has been trying to clamp down on corruption in arms exports since the Serious Fraud Office launched an investigation more than two years ago into allegations that BAE had been operating slush funds in Saudi Arabia and Chile.

Earlier this year SFO and MoD police raided the luxurious Chelsea home of a BAE agent and his Romanian wife, seizing GBP 20,000 in cash. A BAE spokesman said the firm could not comment because the investigation was "ongoing." HMS London has now been renamed Regina Maria while Coventry is Regele Ferdinand.

The two Type 22 frigates were built in the 1980s at a cost of around GBP 120million each.

But Romanian officials are unhappy with their purchase.

Navy chief Victor Blidea said the Dutch had been offering similar, better-equipped ships for GBP 40million. He added: "They were not second-hand ships.

"The British frigates are not bad but their maintenance is too costly."

£20,000 seized at home of man in BAE corruption inquiry

David Leigh and Rob Evans, 9 juni 2006, The Guardian
business.guardian.co.uk/print/0,,329500424-108725,00.html

Anti-corruption investigators probing BAE's role in a British government frigates deal found an estimated £20,000 in euros at the home of the arms company's agent, it was disclosed yesterday when police gained an order to retain the cash. Barry George and his Romanian-born wife Georgiana were arrested for questioning at their Chelsea home and released on Wednesday. The chief Bow Street magistrate, Timothy Workman, yesterday granted an application to hold on to their cash under the Proceeds of Crime Act. Mr George acted as agent for BAE Systems, Britain's biggest arms company, in the lucrative sale of two surplus British frigates to Romania in 2003. It is alleged that BAE paid £7m in secret "commission" offshore to unknown recipients, and was then handed £116m by the Romanian government to refurbish the ships. Yesterday senior Ministry of Defence sources said Sym Taylor, then chief executive of the disposals services agency, which negotiated the government-to-government sale on behalf of the British taxpayer, had been "completely unaware" that BAE was allegedly paying secret commissions. News of the British investigation into BAE yesterday received wide coverage in Bucharest. Further questions about the frigate deal emerged yesterday, when MoD documents revealed that not only was Romania allegedly overcharged, but the British taxpayer received virtually no benefit from the sale.
The two Type 22 frigates, built 15 years earlier at a cost of around £240m, were transferred to BAE from the MoD for scrap value of only £100,000 each. Though BAE went on to secure the refurbishment contract, there was no profit-sharing deal between the British government and the arms company. MoD sources said though Britain received limited further cash benefit, through sale of some £1.5m of equipment for the ships, and refurbishment work had come to British companies, profit sharing was not considered at the time. Yesterday the minister then in charge of arms sales, William Bach, declined to comment on the lack of profit sharing. Asked if he had any knowledge of alleged secret commissions, he said he could not comment. Georgiana George runs a consulting company, Axis Trading, in Bucharest. The Serious Fraud Office is conducting an investigation into allegations of corruption by BAE, including claims that it ran a £60m slush fund to pay off members of the Saudi royal family, and paid over £1m in Chile to intermediaries linked to the former president Augusto Pinochet. The Romanian regime borrowed from Deutsche Bank to fund the BAE deal, with British government backing from the Export Credit Guarantee Department. The frigates, HMS Coventry and HMS London, were refurbished at BAE yards in Portsmouth, and later sailed to the Romanian port of Constanta.