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Saudis threaten to cut ties with Britain over funds probe

Saudi Arabia has threatened to suspend diplomatic ties with Britain unless it intervenes to block an investigation into a 60 million pounds “slush fund” allegedly set up by Britain’s biggest defence company, BAE Systems, for some members of its royal family.

Saudi Arabia has threatened to suspend diplomatic ties with Britain unless it intervenes to block an investigation into a 60 million pounds “slush fund” allegedly set up by Britain’s biggest defence company, BAE Systems, for some members of its royal family.

According to a report in The Sunday Times, a senior Saudi diplomat in London has delivered an ultimatum to British Prime Minister Tony Blair that unless the inquiry into an allegedly corrupt defence deal is dropped, diplomatic links between the two countries would be severed.

The Saudi have also threatened to cut intelligence cooperation with Britain over al-Qaeda, the report said.

They have repeated their threat that they will terminate payments on a defence contract that could be worth 40 billion pounds and safeguard at least 10,000 British jobs.

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The Saudis are furious about the Serious Fraud Office’s criminal investigation into allegations that BAE Systems set up the “slush fund” to support the extravagant lifestyle of members of the Saudi royal family. The payments, in the form of lavish holidays, a fleet of luxury cars including a gold Rolls-Royce, rented apartments and other perks, are alleged to have been paid to ensure that the Saudis continued to buy from BAE under the so-called Al-Yamamah deal, rather than going to another country.

Al-Yamamah is the biggest defence contract in British history and has kept BAE in business for 20 years.

Asked about the Saudi threat, a Downing Street spokesman said: “We don’t speak about ongoing investigations and we don’t speak about discussions with other countries.”

First published on: 20-11-2006 at 01:47:28 am
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