The Gripen affair again

Just when it looked as if the Gripen investigation would suffer a quiet death, there are new developments. And they are serious. Up to now the committee of experts under the leadership of Ágnes Vadai, undersecretary of the Ministry of Defense, managed to produce a thirty-five-page-long report that was handed over to Prime Minister Gyurcsány. Vadai was interviewed several times in the last few months, and she invariably told the reporters that her committee was not charged with investigating any possible bribery by BAE Systems/Saab concerning Hungary’s surprise purchase of Gripen fighter jets. The members of the committee simply analyzed the legality of the decision making process. They discovered a few procedural problems but nothing shocking.

There was a promise that a parliamentary committee would look into the real question: did the Orbán government receive any money from the British-Swedish company to ensure the purchase of Gripens? After all, the original decision was to purchase American planes, but in the last minute Viktor Orbán alone, against the advice of the Hungarian military experts, decided in favor of the Swedish jets. However, there has been a deafening silence concerning the creation of such a parliamentary committee. This isn’t surprising. The chairman of the committee on national defense is István Simicskó (the good Christian Democrat), who in the Orbán government was an undersecretary in the Ministry of Defense. So it looked as if the Gripen affair had been buried once and for all.

And then comes a lengthy article in The New York Times’ business section, November 25: “Payload: Taking Aim at Corporate Bribery.” The story is fairly intricate, and Hungary is but a subplot. The U.S. Justice Department is examining BAE because BAE generates nearly half of its revenue in the United States, and, more importantly, BAE recently acquired a major supplier of armored Humvees used by the Americans in Iraq. What the Justice Department wants to know is whether BAE violated any domestic laws banning international bribery and money laundering. This case is not unique. The Justice Department is investigating about sixty companies under a law called the Foreign Corrupt Practices Act (FCPA).

The article is mostly about BAE’s bribes to the Saudi royal family, but toward the end it claims that BAE most likely also dispersed money to the Czech and Hungarian governments. There were, of course, earlier charges stemming from the Swedish investigation into the Gripen affair. According to the New York Times article, Lt. General Tome H. Walters Jr., then head of overseas sales for the Pentagon, wrote a letter to the Czech foreign minister in which he complained about a “lack of transparency” in the negotiations. He also maintained that “the competition for the contract was not above board.” As we know, the contract was subsequently awared to BAE and its Swedish partner, Saab.

General Walters, now retired, told the reporters that similar problems were encountered trying to sell American jets to the Hungarian government. BAE again secured the Hungarian contract. “American officials say they believe that the Hungarian and Czech governments were influenced by payments. They cite a CIA briefing during which they were told that BAE paid millions of dollars to the major political parties in Hungary to win the contracts there.”

This is a fantastic turn of events and, in my opinion, doesn’t bode well for Viktor Orbán and Fidesz in case these charges can actually be proven. The Department of Defense obviously suspected foul play already in 2001. The CIA was also keeping an eye on the situation. It may take some time, but I hope that eventually we will find out the truth (especially once Western reporters get inspired).

Needless to say, Hungarian reporters ran to Péter Szijjártó, the Fidesz spokesman. They wanted to know the party’s reaction. And what could be the reaction? Fidesz cannot be bothered fighting military companies over contracts. It’s none of their business. The charge is in stark contrast. It was precisely the business–big business–of Fidesz to exact payments for contracts. Let’s see whether the charge can be substantiated.

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[…] the subject was written on August 13, 2007. Shortly afterward, on November 26 of the same year, I had to return to the topic because of a parliamentary committee that was investigating the questionable purchase […]

Member

I guess some money in a Nokia box is small change compared to what some of these deals could bring into some boxes.
I have a question. Are there any requirements in Hungary of full disclosure of received donations? Where can someone check that list of that is exist? You say that there is a possibility that “BAE paid millions of dollars to the major political parties in Hungary to win the contracts there.” Which parties? Would this be in a form of donation? If it is not in the books, then it is gone to various people versus to various parties. Those people maybe took their cut, but at any case if any of the money was filtered into any party via third parties, that is a clear case of money laundering.

Member

I’d like to know if the Orban government inquired the State Department about the details of the alleged bribery. I see no reason why the US would not cooperate. Julian Assange, are you reading this?

Member

Just a ‘bit off topic. I made an off topic post last week regarding an item that showed up on every single government supporting media (go to Google and enter” Mesterhazy, Veres, IMF). The Fidesz explicitly requested Attila Mesterhazy and ex-Finance Minister János Veres to provide the parliamentary economic committee information on the 2008 IMF agreement and on the measures taken to comply with its condition on this past Monday in the parliament. I had not heard anything since then, and any search regarding the subject does not bring up any new items. THis makes me believe that that Fidesz took a shot in the dark again. I would assume if there would of been something that MSZP did at the time that would of compromised Hungary, Fidesz and their friendly media would be going wild on the subject, but there is silence, and today is Wednesday…

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