Innospec verdict rumbles BAE pact

There’s a sporting chance that fifteen pages of judicial commentary published on Friday may end a longstanding embarrassment for those of us working in the UK on international development issues.

Our national reputation for tackling corruption is so dire that the odour of hypocrisy lingers over any pleas we make for developing countries to clean up their act.

Ten days ago the British High Commission in Kenya announced that UK aid for education would be withheld from the government and paid direct to NGOs and schools. Kenyan promises to reform the Ministry of Education in response to massive graft uncovered last year are not progressing fast enough.

Rob Macaire, the High Commissioner, comes across as a principled and courageous diplomat. He’s prepared to speak over the heads of officialdom, encouraging the Kenyan people to believe that they have a role in fighting corruption.

Taken in isolation, his demands of the Kenyan government are faultlessly explicit and entirely justified. But for those of us at home enduring our own government’s incompetence against high profile offenders such as BAE Systems, his words sound like a hostage to fortune.

Kenyan government officials are quite capable of reading our newspapers and juxtaposing Mr.Macaire’s statements with the failings of his own employer:

“Officials found by the audit to have committed fraud must be appropriately sanctioned and their cases passed to the Kenya Anti-Corruption Commission (KACC) for criminal investigation and prosecution if found to have broken the law”
Under the plea bargain accepted by the UK Serious Fraud Office (SFO), all charges against individuals connected with BAE Systems’ activities in Tanzania, Czech Republic and other countries have been dropped.

“The Kenyan Government, its public and donors need to have a clearer picture of the extent of the problem”
By accepting a plea bargain, there will be no opportunity for a court of law to examine the details of the BAE casebook, as demanded by the public interest.

“The (Kenyan) Government has the opportunity now to show it is serious in tackling corruption, not just in education but across all sectors”
The UK government has been condemned by OECD for its lack of political will to fight corruption. It continues to rely on the Prevention of Corruption Acts passed into law between 1889 and 1916.

In fairness, the British government is presenting new legislation but the Bribery Bill recently ran into delays in its passage through the Commons. Tory MPs tabled amendments which undermined its purpose. If the Bill is not passed before the forthcoming election, it may vanish without trace.

Then on Wednesday our slim hopes that the BAE plea bargain might be challenged in the High Court were dashed by a ruling against the valiant efforts of NGOs Campaign Against Arms Trade (CAAT) and The Corner House. The press release restating their case echoes the language of Mr. Macaire’s entreaties in Kenya.

From this low point, the passage of 48 hours worked wonders. First the Tories withdrew their amendments to the Bribery Bill and its chances of becoming law before the election have risen.

Out of the blue on Friday a senior judge heard a case against Innospec, a company charged with paying bribes in Indonesia. There was remarkable similarity with the BAE file – involving a parallel investigation by US prosecutors and a plea bargain deal synchronised across the Atlantic.

Lord Justice Thomas took a profoundly different view from his colleague who threw out CAAT and Corner House. He ruled that the SFO has no authority to make precise deals with companies pleading guilty to complex fraud; this is the job of the courts.

I’m not a lawyer but my reading of the Judge’s sentencing remarks suggests that BAE executives have just spent a most uncomfortable weekend.

I don’t see how the NGOs could fail to win their judicial review on appeal. And unless the SFO itself appeals against this latest twist, it may be forced to abort its approach and resume a criminal investigation.

That would bring some Easter cheer to our sector and put wind in the sails of the British High Commissioner in Kenya.


this article was first published by OneWorld UK