What do you think about the shadowy side of international business — multinational companies that make secret payments to win billions in contracts?
Is there any place where the public can go to find out what suits or complaints have been filed and/or investigations are going on with regard to this and other national and international frauds going on today?
Are investigations being put on hold until the economy "stabilizes?" We've been told, for instance, the people who rated the real estate loans packaged loans gave them triple A ratings when they knew the packages were garbage. Isn't all this RICO material and why aren't people being prosecuted? Seems it would be smart to at least start investigations or legal actions now.
Waite Park, MN
FRONTLINE's editors respond:
See FRONTLINE/World's parallel and ongoing reporting on the issue of international bribery. On their bribery portal of video and stories, there's a map that sketches the major global bribery investigations and the prosecutors behind them. Go to-- FRONTLINE World.
I've read through a number of comments on the site, where the authors effectively say "Who cares about bribery? This is between two countries, neither of which is the US! Who cares how the Saudis spend their money? Why would the Saudi royal family pay themselves through a contract with a defense contractor?"
Are these comments coming from the same people who thump their chests about the War On Terror? The same people who are appalled by Osama bin Laden and others like him?
People! There is a rabbit hole here that you apparently don't even see. This money isn't just going for fancy shopping trips and private jets. It also can end up being spent in far darker ways -- after it's been filtered through "charities" and other fronts. The corruption of the Saudi royal family and the West's feeding of that corruption just might be one of the reasons why Osama bin Laden and people like him have such an axe to grind.
Watching PBS is a good step toward a proper education. I would recommend supplementing that with books.
The BAE program was terribly enlightening. Fresh conspiracy theories abound in my head. BAE, KBR, broken international laws, and the Saudi Royal Family makes good on a thinly veiled threat to not assist in the war on terror. If you stand back and squint your eyes, you can see the a new frame on the past 8 years.
Corruption cases will end up in courts that are also battling their own corruption (see Frontlines, "Justice for Sale,")
Bribery stories are three sided - those who bribe, those who receive the bribe, and those who report it.
Until there is effective and enforceable protection for corruption whisleblowers, global bribery will only get worse. As this article points out, the victims or bribery are often the poor, but they are also the middle class, everyday Americans. Toxic Justice is my memoir and book how I went from injured teacher to judicial corruption whistleblower. I became one of many victims of judicial revenge and retribution. http://www.tulanelink.com/stories/swan_09a.htm
It is our stories, of the dangers we face to expose corruption that explains the real problem behind corruption -- its concealment.
www.popular4people is battling corruption by telling the grassroots stories of whistleblowers.
Mobile, Alabama, USA
Outstanding program. It is both eye-opening and depressing to see how easily the Saudi royal family was able to blackmail the British government. Yet more shame on Tony Blair...
San Francisco, CA
Interesting program, but nothing new: Companies bribe Government Officials to obtain favorable contacts for the payment of Public Money - wow; stop the presses!
What is very interesting about the "deal in question" is why the bribe was needed in the first place? If the Royal Family is the Government, and the cost of bribes is added to the cost of the contract; then aren't they really bribing themselves? If they wanted to embezzle the wealth of their nation, there are many, easier ways to have achieved that objective. Something doesn't make any sense.
No one asked the question - why was this deal done in this way?(and if it was supposed to be "secret"; that part failed totally.) So we come back to the big "WHY"? Why the deal in this manner, and why only this small group of the Royal Family?
Something else must have been (is?) going on - can this be only the "exposed" end of the entire operation?
We see but we do not fully understand, what is in front of us.What are we missing?and most importantly, what is the danger?
When hearing about stories of bribery scandals, too often they are focused exclusively on the "demand" side of corruption - i.e. a government or public official offering to "sell" his/her public influence for private gain. While such activity is not only a gross violation of the public trust (with adverse effects on free markets, government accountability, and foreign aid), we tend to forget that, like any other "market" there is also a very large and powerful "supplier" involved. I applaud Frontline for it's thorough investigation into the causes and effects of bribery, from both the giving and the receiving end.
Much as I tried to work up the appropriate indignation, the gnawing question that was never answered was why would the Saudis, and particularly the royal family expect bribes? Why not simply negotiate a smaller contract with BAE and spend less of their petrobucks? I believe it has everything to do with a clash of cultures and the question is should the Saudis as customers play the game by our (Western) rules, or should we as vendors play the game by theirs?
I perused the comments that have been posted and have to say I am more than a little shocked at how opposed so many people are to a law like the FCPA. I believe one individual referred to bribery as a 'victimless' crime. Seriously? In the context of a government contract like al-Yamamah, the victims are the Saudi people, who are entitled to have their money spent on the objectively best company to supply their military, build their infrastructure, etc. And what about the other companies who bid for the contract? They won't be creating how many jobs because some other company was willing to provide the Royal Family with a global valet service? And I would suppose there are some radical clerics who will gain many new recruits by railing against Western companies that corrupt the Saudi government with Western luxuries.
And, assuming there is no tangible 'damage' to anyone, what ever happened to values? Values like meritocracy, honesty, and fair dealings. These are the values that will win us friends and admiration throughout the world, rather than breed enmity and distrust.
Many philosophies and regimes throughout history have adopted the Machiavellian principle that the ends justify the means - remember Lenin's quip, "If you want to make an omelet, you must be willing to break a few eggs." This is what Bandar is saying when he refers to the $400 billion spent for $350 billion worth of development.
To John Koehler comment: Whether the seller pays 2% of contract price to buyer or 30% or more, it ALWAYS is the buyer who pays the tariff unless the seller is totally incompetent.
Supplementing my own comment: I forgot to mention a most important consideration when governments are involved directly in the transactions.
Specifically: The seller gains politco/economic/military control over the buyer. In the US/UK Saudi deal of the 1960's, a US policy consideration was a decision at the highest levels NOT to introduce supersonic fighter aircraft in the Middle East and fan the flames of an arms race. US endeavored to promote Northrop's F-5, a Mach 1.2 aircraft when clean, because the Saudis were hell bent on getting Lockheed's F-104, a Mach 2 aircraft. When Saudis refused the F-5 and insisted on Mach 2, the US/UK deal was born. Helping the UK promote the P-1 (Mach 2), would satisfy the Saudis appetite while providing them with an aircraft totally beyond their operational and maintenance capabilities. The Saudis would be totally dependent on UK pilots, maintenance crews and spare parts, something that would help calm the anxiety emanating from some neighboring country.
It would also remove the US as a supplier of advanced aircraft in the area. US did not want to deny country X the same weapons system it sold to country S. The Hawk surface to air missile system was a strictly defensive system and had already been supplied to country X. Hence X could not very well object to its sale to S. The UK, which several months earlier purchased $1.1 billion worth of US military aircraft (F-4 Phantoms, F-111 Bombers and C-130 Transports) financed by an Export-Import Bank loan, was looking to the US for some "off-sets", which could be met partially the US could partially fulfill by withdrawing its offer to the Saudis and "silently" help BA promote the P-1. In exchange, the UK agreed to help the US sell the Hawk SAM despite the fact that the Saudis already agreed earlier to buy the UK Bloodhound SAM. The UK also was in the lead in the competition for C&C equipment - hence the US willingness (or eagerness) to get a piece of that sale. So, as you can see, there are many factors to be considered by governments when deciding whom to support, for what, why, how and when. Please remember that the preceding considerations were valid at that time. Some of them still are valid today.
Palm City, FL
One of the best Frontline programs I've ever watched. I knew a lot of this was going on but I had no idea of the extent and the amounts. This was a very enlightening installment in a series of enlightening programs. Keep up the good work.
Los Angeles, CA
It's a shame that politicians neither accountable to internationally recognized and endorsed anti-bribery laws nor to basic human decency were able to successfully resist the lawful efforts of that former director of SFO and his investigator, both crime fighters deserving of our gratitude. I came away from this expose saddened that good people fighting such huge and harmful acts of corruption lose their jobs or resign for their efforts, while the guilty never see the slightest interruption in the flow of dirty money into their bank accounts, a day in prison, or even so much as suffer the proverbial slap on the wrist. Tony Blair shamed himself and his government by claiming that Al-Qaeda will get us and that we will lose our jobs if we dare to stand up to corporate bribery and money laundering. The message? Bribery gets things done and is the way of the world, as Bandar Bush claims. If that's the case, then we are fighting international terrorism in order to preserve a way of life not worth preserving. It's only when we allow our better selves to triumph, when we take a consistent stand against bribery, money laundering, and other criminal behaviors, that we have a way of life worth sustaining and fighting for.
The Prince is right. This is as old as Adam and Eve. Of course you will not hear that when you get your MBA in international business. This is something you learn as you start doing business with other countries. Shocking to the Americans, maybe.. it's a way of life for pretty much the rest of the world. Vatican City is not immune to this, history has shown.
Los Angeles, Ca
I'm still trying to understand what is wrong about the transactions you described, which constitute nothing more or less than the normal course of business in most of the world. They are illegal, because there's a law against them, but laws can be arbitrary, and this one certainly qualifies. By what divine right does the U.S. presume to dictate the terms of a business contract between two faraway kingdoms, and to confect a criminal case where no victim exists, and where the U.S. is not involved in any capacity?
The rest of the world does not, need not, and will not function exactly as the United States demands it should, irrespective of American laws, or international laws inspired by an overreaching U.S. government. This larger issue is more interesting and more worthy of the Frontline brand than a titillating tabloid tale of spendthrift Saudi princes.
San Francisco, CA
Fantastic programme: thrilled to have finally seen it, after much expectation. Certainly a number of black holes in the rule of law, in Europe at least: one rule for the powerful, another for the not-so-powerful. Will be intereesting to see how the US Department of Justice deal with BAE Systems, and the FCPA has really set the standard.
The British government is in a position of deep shame after its emasculation of the UK Serious Fraud Office.
Accountability,transparency and and rule of law are lofty Western ideals that have no bearing whatsoever when it comes to Third World countries, particularly in Africa for nation-states like Nigeria.
I only wish the West will stop pontificating about "democracy" when creation middle class is all but an illusion in Africa; no middle class,no democracy. Poverty and corruption are two faces of a coin,the ruling elites and monarchs of Third World pocket the golden coins and the masses are crushed under abject poverty.
I will, however,second Ambassador Bandar's opinion, out of $400 billion, Saudi Arabia, could show case $350 billion in development, that can't be said of Nigeria or South Africa, and Mr.C.J Wanju, that's the Shame.