But investigators backtrack from questioning Amyas Morse over previous job at MoD
SFO sources revealed to Exaro that investigators wanted to interview Amyas Morse, NAO chief and auditor general, as a witness about his previous role as a senior official at the Ministry of Defence that they believed gave him some oversight of a long-running contract to overhaul the Saudi national guard’s communications systems under the ‘Sangcom project’.
Before heading the body that audits the spending of all government departments, Morse ran the MoD’s new commercial directorate from 2006 to 2009, shaping the ministry’s relationship with industry, and overseeing its commercial arrangements.
His job was to streamline and modernize the ministry’s much-criticized procurement of equipment which had persistently resulted in embarrassing overspends and delivery delays.
While he was not implicated in any alleged wrongdoing, Morse was on a list of people to interview, one senior SFO source said. “You have to ask what the MoD knew,” he explained.
However, he added that the SFO was rowing back from the move because it had become scared of challenging the MoD over such a highly sensitive issue – alleged bribes in a huge government-to-government defence deal with Saudi Arabia.
Morse would make no comment to Exaro. Asked whether the SFO had approached him for assistance, an NAO spokeswoman said: “As this is an ongoing investigation, it would not be appropriate for us to comment.”
Exaro revealed in May last year evidence from whistleblowers that showed how GPT Special Project Management, a UK subsidiary of EADS, the European defence group, transferred more than £14.5 million as part of the Sangcom project between 2007 and 2010 to two mysterious offshore companies that did not appear to carry out any sub-contracting work.
Exaro has published a series of disclosures about the deal, leading to the launch of the SFO’s full criminal investigation.
Sources close to the SFO investigation say that the position of EADS is that the group has done nothing on the Sangcom project without the MoD’s approval.
Neither EADS nor the MoD is commenting on the Sangcom project, citing the SFO investigation. EADS has only said that it is co-operating with the SFO investigation.
Exaro previously revealed that the MoD knew about the offshore transfers and warned that the ministry was unlikely to approve them in future, although payments continued for at least another 19 months.
When the Sangcom deal was first negotiated back in 1976, the MoD’s then permanent secretary, Frank Cooper, approved the inclusion of “agency fees” of 15 per cent. The initial contract was valued then at £150 million, but the latest 10-year phase is reportedly worth £2 billion.
Morse has clashed with the SFO over a separate issue. Last November, he qualified the SFO’s 2011-12 accounts over a £422,000 pay-off for its former chief executive officer, Phillippa Williamson. The SFO agreed to the “irregular” payments – without approval from the Cabinet Office or the Treasury – in April last year just before David Green took over as director.
But it was Morse’s previous MoD role that had made him potentially relevant to the SFO investigation into the Sangcom project. And Exaro reveals today that he doubts whether the SFO will find any evidence of corruption in the MoD’s accounts.