Airbus subsidiary at center of bribery probe to cease operations

GPT Special Project Management has been under investigation by the U.K. Serious Fraud Office since 2012 concerning a service contract in Saudi Arabia that pre-dated GPT’s acquisition by Airbus in 2007. The investigation concerns allegations made by a whistleblower that GPT paid at least £14 million (U.S. $17.8 million) to secure a £2 billion (U.S. $2.5 billion) military contract with the Saudi Arabian government.

In its annual report, GPT said it has been “serving a single customer since its formation due to its status as a prime contractor to the U.K. Ministry of Defense” and that the company “has no intentions to seek new business with other customers.” When the 10-year program expires on Dec. 31, 2019, with no anticipated renewal, “the company is expected to cease business operations,” the annual report stated.

“As the allegations in this case relate to a government-to-government contract, in which officials from the Ministry of Defense were involved in at least some oversight of the project budget, we believe it is essential that lessons about government oversight of such projects must be properly learned,” anti-corruption campaign groups Transparency International U.K. and Corruption Watch wrote in a 2017 letter to the attorney general.

The letter noted that the GPT investigation is the second government-to government contract relating to Saudi Arabia in the defense sector on which serious allegations of wrongdoing have emerged. The other pertained to a contract that BAE Systems had with the Saudi government.

“Both involve alleged wrongdoing in Saudi Arabia in relation to government to government defense contracts,” the letter stated. “The decision to drop the investigation into the allegations relating to BAE in 2006 did untold damage to the U.K.’s reputation as a country that trades with integrity and seriously undermined the OECD’s Anti-Bribery Convention.”

Anti-corruption campaigners have expressed concerns that the closure could prevent the SFO from bringing a prosecution against the subsidiary, although individuals could still be held liable. Transparency International U.K. and Corruption Watch have accused the government of deliberately interfering in the investigation by “sitting on” the case, reports The Guardian, which first reported GPT’s closure.

In a final report published in 2017, Transparency International U.K. and Corruption Watch called the GPT case “a test of the SFO’s resolve and willingness to flex the muscles of its own independence. Any attempt to limit charges to either lesser offences or solely to a few individuals will be seen as letting GPT off the hook. It must show it can make robust charging decisions and be as transparent as possible about how it makes them.”