The U.S. government has fined BAE Systems up to $79-million (U.S.) and will maintain “enhanced” oversight over some of the defence contractor’s UK-based export program as part of a deal that looks to have drawn a line under a corruption probe into the company by Washington.
The settlement with the U.S. State Department is part of a wider U.S. investigation into BAE which saw it plead guilty last year to one charge of conspiracy to defraud the U.S. in connection with the company’s anti-bribery compliance program and violation of export control laws.
As part of that plea, BAE paid a $400-million fine to the Department of Justice, which conducted a separate probe. It also settled a UK investigation by paying a £30-million fine after pleading guilty to a minor accounting offence.
The State Department was required by law to launch its own investigation to ensure that no export licences are granted to parties involved in illegal practices. The investigation did not include BAE’s U.S. subsidiary, which generates more than half the company’s profits.
BAE said on Tuesday that as part of the civil settlement with the State Department “a limited number of the company’s UK-originated export program will be subjected to enhanced administrative review”, adding that it did not expect this measure to “adversely impact . . . current or future export programs”.
Many of the weapon’s systems and other equipment made by BAE outside the U.S. are likely to contain some technology that originates from the U.S. Under U.S. law, the State Department has the power to block any export of military technology.
BAE did not clarify which programs were affected but said any such review applied to future licence applications on a “case-by-case basis”.