As part of the February 2010 settlement agreement by the Serious Fraud Office (SFO) and BAE Systems Plc, BAE agreed to pay GBP 30 million in ex gratia payment for the benefit of the people of Tanzania in a manner to be agreed between the SFO and the Company, less any financial orders imposed by the Court. In December 2010, the Southwark Crown Court approved the settlement, and fined the company GBP 500,000 and ordered it to pay GBP 225,000 in costs to the Serious Fraud Office. (Sources: R v. BAE Systems PLC, Case No. S2010565, Southwark Crown Court, December 21, 2010; Serious Fraud Office Press Release, "BAE fined in Tanzania defense contract case," December 21, 2010.)
The company had agreed to pay the legal costs separate from the GBP 30 million settlement amount. In March 2012, the SFO announced that a newly agreed upon Memorandum of Understanding will enable the GBP 29.5 million plus accrued interest [amount unspecified] to be spent towards education projects in Tanzania. (Source: UK Serious Fraud Office Press Release, "BAE Systems will pay towards educating children in Tanzania after signing an agreement brokered by the Serious Fraud Office," March 15, 2012.)
For greater discussion of the case, see UK Parliament, House of Commons, The International Development Committee, "Financial Crime and Development, Eleventh Report of Session 2010–12," Volume I (30 November 2011) and Transparency International UK, "Deterring and Punishing Corporate Bribery: An Evaluation of UK Corporate Plea Agreements and Civil Recovery in Overseas Bribery Cases," (June 2012.)
According to a press release by the UK Serious Fraud Office, in December 2010, the Southwark Crown Court approved the February 2010 settlement agreement by the Serious Fraud Office (SFO) and BAE Systems Plc in which the company agreed to plead guilty to one count of breaching its duty to keep accounting records contrary to section 221 of the Companies Act 1985. (Source: Serious Fraud Office Press Release, "BAE fined in Tanzania defense contract case," December 21, 2010.)
The prosecuting authority was the Crown Prosecution Service.
The court involved was the Southwark Crown Court.
Contributing factors in this asset recovery were a settlement agreement by the Serious Fraud Office and BAE included provision on ex gratia payment to Tanzania; Memorandum of Understanding by Serious Fraud Office, the Government of Tanzania, BAE Systems and the Department for International Development (DFID) (Source: UK Serious Fraud Office Press Release, "BAE Systems will pay towards educating children in Tanzania after signing an agreement brokered by the Serious Fraud Office," March 15, 2012.)
The basis for international cooperation was the Memorandum of Understanding.
Assets returned
In the agreement for returned assets, "the Serious Fraud Office, the Government of Tanzania, BAE Systems and the Department for International Development (DFID) have now signed a Memorandum of Understanding enabling the payment of £29.5 million plus accrued interest to be paid by BAE Systems for educational projects in Tanzania." The funds will be used for the purchase of textbooks and other school supplies and equipment. (Source: UK Serious Fraud Office, "BAE Systems will pay towards educating children in Tanzania after signing an agreement brokered by the Serious Fraud Office," March 15, 2012.)
| Document Title | Size and Format | Document Type | |
|---|---|---|---|
| Link | Government report / press release | Go to site | |
| Link | Government report / press release | Go to site | |
| BAE SFO Press Release March 2012 | 75.94 KB pdf | Government report / press release | Download |
| UK Parliament Financial Crimes Hearing Report November 2011 | 971.05 KB pdf | Government report / press release | Download |
| R v. BAE Systems PLC, Case No. S2010565, Southwark Crown Court Sentencing Remarks of December 21, 2010 | 77.58 KB pdf | Court document | Download |
| Link | Government report / press release | Go to site |