Whisky, women and weapons
June 12, 2007
LONG after midnight, the party is in full swing, the music loud, the whisky and champagne flowing. In the penthouse suite at a five-star London hotel, six attractive young British women, most in short, tight dresses that leave little to the imagination, sashay between wealthy princes from Saudi Arabia, flirting and laughing slightly more loudly than the Arabs’ witticisms merit.
A silver dish of white powder, with matching spoon, is passed around. From time to time a couple slips out of the suite only to reappear half an hour later and seek new friends. Others do not feel impelled to leave to share intimate moments but settle on a sofa or the four-poster in the main bedroom oblivious, perhaps, to their fellow partygoers.
A millionaire British businessman standing near the window overlooking Hyde Park, drinks in the decadent scene.
“It was my first party with the Saudis, in the early ’90s, and it was a bit of an eye-opener,” he recalls. “We’d been to the casino and I watched the princes gamble like there was no tomorrow. The money they threw around was staggering. Then we went upstairs for the party. It was shocking but fascinating at the same time.”
One woman at the party tells him she was paid hundreds of pounds to attend and will earn much more by sleeping with one – or more – of the Saudi visitors. “She said she would get £2000 ($A4700) for spending the night with a prince,” he says. “The Saudis had their favourite girls and liked to think they were their girlfriends in London. They don’t like to admit they are paying for sex.”
Days later, back in their home city of Riyadh, some 4800 kilometres from their London playground, the Saudi princes are on their best behaviour. No alcohol, no drugs, no whores. Perhaps the occasional drink, but discreetly, in private, with close friends. They know a flogging awaits those who are caught with as much as a glass of Johnnie Walker by the dreaded religious police, who torture suspects with impunity.
For this is the country where Islamic sharia law reigns, the Koran is the constitution, woman are not allowed to drive and where the religious zealots hold sway over law and order in a delicate pact with the ruling House of Saud, the extended royal family that holds every government post.
Over in the capital’s notorious Chop Chop Square, in front of sand-coloured buildings and a line of palm trees, the executioner brandishes his sword before calmly but swiftly cutting off a thief’s right hand. If he offends again the left hand will follow. On other days the executioner will behead a cuffed and blindfolded drug-dealer, rapist or murderer, watched by a rapt – and approving – crowd who laugh and cry “Allah Akbar!” when the blood shoots into the air and cascades down onto their clothes.
This authoritarian country with princes who are Muslims at home and licentious away, is also the one with which Britain signed its biggest-ever export deal in 1985: the al-Yamamah agreement to sell 72 Tornado and 30 Hawk warplanes for POUNDS43 billion, mostly paid in oil shipments, over 20 years.
The deal, signed by Saudi Defence Minister Prince Sultan and the defence secretary, Michael Heseltine, has been mired in controversy over alleged corruption for years. Now the furore has erupted again. This time the claim is that BAE Systems <0x2014> the UK’s biggest arms manufacturer – paid more than £1 billion into two Washington accounts controlled by the former Saudi ambassador to the US, Prince Bandar, the Defence Minister’s son, over more than a decade. The payments, made on a quarterly basis, were allegedly written into “secret annexes” of the al-Yamamah contract for the provision of “support services”, with the full knowledge and approval of the Ministry of Defence.
MPs have demanded an inquiry to find out whether government ministers were involved in corruption. A criminal investigation by the Serious Fraud Office – which is understood to have discovered the payments but not whether they were illegal – was controversially dropped “in the interests of national security” last year. Prime Minister Tony Blair had warned that the Saudis, vital allies in the war on terrorism and a stabilising force in the Middle East, would stop sharing anti-terrorist intelligence if the inquiry was concluded.
Many who have lived and worked in Saudi Arabia or done business with the Gulf state say the claims show a failure to understand the Saudi culture. “It’s totally different from ours,” says Jonathan Aitken, the former defence minister who took part in key negotiations over the al-Yamamah contract in the early ’90s. “The Saudi monarchy is similar to a Tudor monarchy in that servants of the Crown are rewarded by the king or senior princes for doing their public service faithfully and well. They believe people are entitled to a slice of the action when they help with something like a big contract.”
No British minister was told anything about the alleged payments, he says. “But living in the real world there were always going to be some parts of the contract – training, spares and construction, for example – for which agents would receive commission.
“Sales commission is what makes the world of commerce go round. The big picture is that Saudi Arabia is a crucial ally for intelligence and is a stabilising influence in a volatile region.”
Heseltine agrees. “If this is the way the Saudis want arrangements for their procurement program, an international company would have had no choice but to go along with that. It’s massively important to us and the stability of the Middle East that we have those defence interests in Saudi.”
Doing business with the Saudis is not like doing business in the West. Deals take longer, typically 18 months to two years to finalise. “The Saudis like to get to know and trust you,” says David Lloyd, a senior consultant for the Middle East Association, who makes regular trips to Saudi Arabia with trade missions. “They like to see your face, look you in the eye and expect to meet the same people each time. They treat you as a guest in their country and set great store by personal relationships with all countries, not just the UK.”
The Saudi royals also like to entertain and expect that to be reciprocated. In their home country that will consist of lavish dinners, with the finest food, in elegant surroundings. Abroad they will expect at least the same – and sometimes much more, especially in western Europe.
Aitken says that senior members of the Saudi royal family did not ask for prostitutes or drugs during his time in office. “We took them to see shows like Chicago and then we would get a table at Annabelle’s,” he says. “They were dignified and, on the whole, they did not get up to those squalid antics.”
The “whisky and women” were usually demanded by less senior members of the ruling family, says one former diplomat in Riyadh.
“There are about 5000 Saudi princes and a lot of the younger ones especially like to do things that many men of their age do. They are very restricted in their country so it’s understandable that some go a bit wild when they are over here.”
Even in Saudi Arabia, he said, there was much discreet drinking, especially among expatriates but also among the locals.
SAUDI Arabia is a country run by a curious coalition of the wealthy, nepotistic House of Saud and the fundamentalist Wahhabi religious leaders. The royal family has ruled the desert kingdom – which has 25 per cent of the world’s oil reserves – since 1932 when King Abdul Aziz al-Saud united warring tribes under Sharia law.
It has an historic connection with the Wahhabis, a branch of Islam linked to September 11, 2001, but King Abdullah’s desire to modernise the country – he succeeded King Fahd who died two years ago – has created tension with the clerics who are resisting his attempts to liberalise education and give women more freedom.
One of the king’s first appointments was to make his nephew Prince Bandar – the Western-friendly “Mr Fixit” and the central figure in the al-Yamamah row – his national security adviser.
The cigar-smoking prince has been friendly with British prime ministers and US presidents since the days of Margaret Thatcher and Ronald Reagan and is particularly close to George Bush snr and his son. Described as “charismatic and charming”, he glides easily between the West and the Gulf. He trained as a fighter pilot in the US and at RAF Cranwell in the UK.
The prince has certainly enjoyed the fruits of his al-Yamamah labours: he has a personal Airbus, painted in the silver and blue colours of his favourite American football team, the Dallas Cowboys, and landing rights at RAF Brize Norton, close to his 800-hectare Oxfordshire estate at Glympton.
It was Margaret Thatcher who approached Bandar in December 1984 for help in getting BAE a new weapons contract. He cleared the deal with the Reagan administration – unable to sell to Riyadh because of pro-Israeli opposition in Congress – then flew to London to meet Charles Powell, Thatcher’s private secretary, and other key officials. In summer of 1985, the Saudi envoy flew to Salzburg, where Thatcher was on holiday, with a letter from King Fahd to seal the deal, according to William Simpson, Bandar’s biographer and former RAF classmate.
“I told her specific numbers, shook hands, and the deal was done,” Bandar is quoted in the book as saying. The contract, the first instalment of a 20-year deal, was the fourth with BAE since 1967 in which commissions of up to 15 per cent had been passed to Saudi royals with Downing Street’s backing, according to British archives.
Other figures with smaller roles in the affair include the Syrian-born Wafic Said and Mark Thatcher, Baroness Thatcher’s son. Said, who went to the UK in the late 1960s, helped his brother run a kebab shop, became friends with the princes Bandar and Khalid, began organising their financial affairs, and is now worth an estimated £1 billion. Like Bandar, he owns an estate in Oxfordshire, 1200 hectares he bought in 1987.
Said, who donated an estimated £500,000 to the Tory party, is credited with helping to persuade the Saudi regime to “buy British” in the al-Yamamah deal and it is claimed that he hired Mark Thatcher as an unofficial “back channel”. Thatcher has denied allegations he received up to £12 million as part of the agreement.
The mystery over what was paid to whom and why in the deal has deepened because the Government, BAE and the Serious Fraud Office have declined to comment for “national security” and economic reasons. Blair said the completion of the investigation would have led to “complete wreckage of a vital interest to our country” and the loss of “thousands of British jobs”.
Bandar insists there were no secret commissions or “backhanders”. The payments were in the contract and any money paid from the accounts was “exclusively for purposes approved by the Saudi Arabian Ministry of Defence and Aviation”, he says.
When asked at another time about payments, he responded more robustly: “So what?”
So far the new “revelations” have changed nothing and the Government is determined that is how it will remain. But there is concern that BAE will suffer from the termination of the investigation. South Africa is under investigation over a BAE deal and although President Thabo Mbeki continues to co-operate with the Serious Fraud Office, he is furious over the different treatment of his country. He is expected to put Britain under pressure to drop the inquiry.
Washington, too, remains deeply suspicious. For years, US defence companies have refused to buy from BAE, concerned that it might fall foul of America’s Foreign and Corrupt Practices Act.
Meanwhile the Saudi princes continue to party, albeit more discreetly than in the past.
“They are a bit less flash nowadays,” the British businessman says. “But they still like to live it up in London.”
And still the stories come. Two months ago a newspaper claimed that two British actresses were paid tens of thousands of £ in 2001 from a slush fund set up by BAE to entertain a Saudi prince involved in the al-Yamamah deal. And in October last year, the 24-year-old model girlfriend of a Chelsea footballer was exposed as a former £1000-an-hour prostitute paid to take part in orgies and lesbian shows for rich Arabs.
With oil prices high and the Saudi economy booming, it seems the hedonistic London parties are far from over for the desert kingdom’s princely elite.
The Sunday Telegraph