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U.K. tries to "sabotage" BAE probe

David Leigh and Rob Evans

Attempt to oust legal expert heading European corruption investigation

London: The U.K. is covertly trying to oust the head of the world's main anti-bribery watchdog to prevent criticism of Ministers and Britain's biggest arms company, BAE, the Guardian has learnt.

The effort to remove Mark Pieth comes as his organisation has stepped up its investigation into the British government's decision to kill off a major inquiry into allegations that BAE paid massive bribes to land Saudi arms deals.

British diplomats are seeking to remove Professor Pieth, a Swiss legal expert who chairs the anti-corruption watchdog of the Organisation for Economic Cooperation and Development (OECD), claiming he is too outspoken.

At the OECD meeting in Paris last month, British officials tried to stop Prof. Pieth addressing a press conference at which he announced his agency was to conduct a formal inquiry into the Government's decision to terminate the BAE investigation. They then privately briefed other diplomats involved with the OECD, saying he should be removed.

Unabated campaign

When that failed, the campaign against him continued unabated with further back-channel complaints. But concern about the conduct of the British diplomats filtered back to Prof. Pieth, who confirmed on Monday that he was aware of the attempts to remove him. ``I am aware that the British Ambassador was asking at the time for action to be taken against me,'' he said.

Prof. Pieth refused to elaborate, but he is understood to be privately furious at the way he has been bad-mouthed.

A source at the OECD added: ``The U.K.'s representatives were sent to Paris to emasculate the [watchdog] and ensure they did not say anything publicly. They failed and were not pleased. They behaved in a manner that would not have been out of place in a boxing ring.''

In recent weeks, the U.K. has demanded that OECD officials should be prevented from making any future statements about the BAE case while the inquiry is ongoing. But the request has hit a brick wall. An OECD source said: ``The British do not have support from anyone else on this.'' Director-General of the OECD Angel Gurria also believes that the U.K. is encouraging a smear campaign against him too.

Last Friday, he was accused in a British magazine of giving a job to his daughter, getting free football tickets, and spending euro 7,33,000 to refurbish his Paris flat in what was described as ``the poshest bit of the swanky 16th arrondissement''.

The article in the Economist quoted an unnamed north European Ambassador expressing fears that ``the staid old body [OECD] ... may drift into dangerous waters'' under Mr. Gurria, former Finance Minister of Mexico. Following the allegations, Mr. Gurria issued a combative statement, saying he was under U.K. media attack by ``innuendo, gossip and partial truths''.

Britain's Ambassador to the OECD, David Lyscom, admitted on Monday that he had talked off the record to the Economist but added: ``The U.K. had absolutely nothing to do with planting the story.''

Sensitivity over the OECD inquiry has become more acute since its 36-strong panel announced last month detailed plans to mount a fresh official inspection of Britain because of the manner in which the BAE inquiry had been halted.

The U.K. also faces a legal challenge in London.

Two campaign groups, the anti-corruption group The Cornerhouse and the Campaign Against the Arms Trade, filed detailed pleadings last week alleging that Britain had broken the treaty banning corrupt payments by companies to foreign politicians and officials. —

© Guardian Newspapers Limited 2006

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