3. The Saudi Connection
The Prime Minister curtsied so low she was almost squatting. Margaret Thatcher, the Iron Lady of whom Prince Bandar once said: ‘that woman was a hell of a man’, did not take kindly to subservience. But on arriving in Saudi Arabia, where women are not allowed to drive let alone participate in politics, she was more than happy to supplicate before the Saudi royal family. After all, they were about to save the newly privatized BAE from financial collapse, with the biggest arms deal of all time.
Signed in 1985, the Al Yamamah deal netted British companies, predominantly BAE, over £43bn for the supply and support of 96 Panavia Tornado ground attack aircraft, 24 Air Defence Variants (ADVs), 50 BAE Hawk and 50 Pilatus PC-9 aircraft, specialized naval vessels, missiles, shells, support services and various infrastructure works. In return the Saudis would supply 400,000 barrels of oil per day.1 In later years, the quantities of matériel and oil would both increase.*
Britain was awarded the deal not because of the superiority of its products but because the US Congress, under pressure from the powerful Israel lobby, would not agree to the sale of the F-15 fighter jets that the Saudis wanted. But France almost trumped the British. Throughout 1984 and 1985 it appeared France’s Mirage 2000 fighter had won out against the UK’s bid on the grounds of cost and earlier delivery. Michael Heseltine, the British Defence Minister, was dispatched to Riyadh to push the UK’s case. However, France’s more amenable foreign policy approach in the Middle East had swayed King Fahd, who gave Heseltine a rough reception.2 The French jet had already been successfully sold to Greece, India and Abu Dhabi and had the great advantage of being 25–30 per cent cheaper than the Tornado.3 President Mitterrand had lobbied Crown Prince Abdullah in a meeting in February 1985 and by March the French deal was said to be near completion.4 It was thought at the time that the Saudis still hoped to convince the Americans to sell them F-15s and were using progress on the French deal to pressure the US.5 But April came and it was clear that the F-15s would not be sold.6
Where Heseltine failed to charm, Thatcher succeeded. The Prime Minister interrupted a holiday in Salzburg in Austria to hold talks with Prince Bandar.7 The charismatic, dashing Saudi operator presented Mrs Thatcher with a letter from King Fahd containing a formal request for the Tornado purchase. Thatcher’s immediate response was ‘You have a deal.’ Bandar claims the conversation lasted no more than twenty-five minutes, the easiest arms deal he ever clinched.8 Exactly what was offered to secure the deal is still hotly debated.
The first Al Yamamah contract was formally signed in Lancaster House on 25 September 1985, for 132 military aircraft. Michael Heseltine and Prince Sultan, the Saudi Defence Minister, were the signatories. The French expressed shock at losing out, telling the Observer with typical Gallic understatement that it was ‘unexpected, incomprehensible and catastrophic’, and asserting that ‘this brutal change [was] of a political nature’.9 They may have been referring to the suspicion of bribes, or that the US administration, not able to supply their own F-15s, pushed the Saudis towards their loyal ally. A British ‘aviation official’ opined that ‘the American Jewish lobby has done us a favour’.10
Industry experts suggest that the Tornado might have been the better strategic option for the Saudis, as it is both an interceptor and strike fighter, whereas the Mirage lacked the same strike capability.11 However, the equipment offered was far from state of the art. So bad were the reliability issues with British aircraft in previous deals, especially, as we’ve seen, Lightning jets unsuited to the desert environment, that engineers working at the Dhahran airbase were known to joke that the only Tornado they could keep in the air was the one mounted on a plinth outside the main gate.12
Under the terms of the contract, BP and Shell processed and sold the oil that was used as payment for the aircraft. The proceeds were deposited, less a fee, into a Ministry of Defence account at the Bank of England, from which BAE would be paid. The deal was to prove the company’s lifeline for decades to come.*
Figure 1: Payment chain for the Al Yamamah deal
In July 1988, a second phase of Al Yamamah was announced. Al Yamamah-2 was estimated to be worth up to £10bn.13 It included 48 Tornadoes, along with the weapons and spares required, 60 Hawk jets, 88 Westland helicopters – mainly Black Hawks – 6 Sandown class minesweepers, a few BAE 125 and 146 aircraft for communications, the construction of an airbase – though this was later dropped – and facilities for the minesweepers, as well as training for the Air Force and Navy. The deal was signed on 3 July 1988 by Prince Sultan and the UK’s Defence Secretary, George Younger. Margaret Thatcher was again involved in the negotiations.14
The continuation of Al Yamamah was a clear indication of Saudi frustration with the US attitude to arms exports to the country. In the years between the two phases of the deal, the Saudis had several large arms purchases blocked by the US Congress. Had Congress not refused them, BAE would not have won the contracts. As one Saudi official put it: ‘We would prefer buying weapons from the USA. American technology is generally superior. But we are not going to pay billions of dollars to be insulted. We are not masochists.’15 In May 1986, Congress had overwhelmingly opposed the sale of missiles to Saudi Arabia. With more than a two-thirds majority against the sale, the pro-Saudi President Reagan was unable to use his veto. The vote reflected both the power of the Israel lobby and scepticism over Saudi support for the US following an American air strike on Libya, with some US politicians fearing Saudi Arabia might divert weapons to ‘terrorists’.16
Payments for both phases of the deal were affected by a fall in the price of oil by 1989 which meant that the 400,000 barrels a day would be insufficient to pay for the equipment. The falling oil price also precipitated a budget crisis in Saudi Arabia. Unwilling to borrow substantially from abroad, the Saudis’ profligate arms spending was under threat. Some of the equipment bought under the first phase of Al Yamamah was intended to be sold on to Iraq but the end of the Iran–Iraq War in 1988 left the Saudis without a buyer.17 However, their insatiable desire for weapons, and the accompanying bribes, motivated the Saudis to make a cash payment of £1.3bn and increase the flow of oil by an additional 100,000 barrels a day.18
The use of oil as the medium of exchange for the Al Yamamah contracts made bribes easier to hide, allowed Saudi Arabia to bypass OPEC’s restrictive quota guidelines and enabled the Saudi Ministry of Defence to continue to purchase weapons with no scrutiny.19 Tony Edwards, the head of Deso from 1998 to 2002, admitted that ‘for the Saudis the use of oil meant that the contract was effectively an off-balance-sheet transaction: it did not go through the Saudi treasury’.20 Chas Freeman, a former US ambassador in Riyadh, described the mechanism whereby the oil companies paid the proceeds from the sale of the Al Yamamah oil into a bank account administered by the UK MoD, with BAE the custodian, as ‘a general slush fund for the Saudi Ministry of Defence. They could debit anything they wanted against this account and BAE would do the procurement. And it was not subject to public scrutiny in either country. It was off budget and because it was out of sight, it was peculiarly susceptible to corruption.’21
The Iraqi invasion of Kuwait in August 1990, accompanied by a huge American airlift to protect Saudi Arabia from Saddam’s aggression, changed the political dynamic towards the Arab nation in the US. In no small part due to Prince Bandar’s tireless diplomatic efforts and legendarily generous schmoozing, the desert kingdom was once again seen as a crucial guardian of Western interests in the region.* This shift made it easier for the US to supply its Saudi ally directly rather than have the UK do it for them. The perceived superior quality of US equipment, battle-tested in the Middle East environment, contrasted with the poor reliability of BAE’s Tornado jets.22 In fact, the US was forced to fly extra sorties to cover for the Tornadoes incapacitated by sand and a radar fault which required the manual tracking of targets using stopwatches.23 Dick Cheney, then US Defense Secretary, promised Saudi Arabia a wealth of new military equipment previously disallowed by Congress, on the basis that ‘the situation in the Gulf region has changed dramatically’.24
However, in September 1990 Prince Bandar made clear that ‘we have no intention of scaling down our British purchases. If anything, we might be looking for more co-operation with our friends in Europe, including Britain, and for more equipment to equip our armed forces.’25 This reduced Saudi dependency on US supplies in what remained a volatile political environment. In 1991, Bandar announced that the kingdom would conclude deals for the equipment still outstanding from the Al Yamamah-2 deal. Despite the evidence to the contrary, Bandar praised the British equipment for its performance during the First Gulf War, saying: ‘We are very pleased with the performance of the Tornado in the Gulf War. When we first ordered the fighter in 1985 we needed strike capability and it proved itself during the conflict. We are also grateful for the support shown to our country by Mrs Thatcher and for the continued support from Mr Major.’26 The Al Yamamah deal in its entirety would eventually be worth over £43bn to BAE.27
While the second part of the deal included an offset component, investment was limited and the jobs created never rose above the hundreds.28 One of the stranger spin-offs of the deal was the appearance of the England football team in the kingdom in November 1988, to play a friendly international. They were flown on a Concorde jet chartered by BAE and ‘topped up with the company’s officials, customers and clients’. The Football Association’s chief executive, Graham Kelly, announced that ‘The FA are more than happy to assist the government to fulfil its obligation to Saudi Arabia.’29
* * *
On the British side, BAE’s Richard (Dick) Evans was almost as crucial as Margaret Thatcher. The bluff, pugnacious, Blackpool-born salesman was prepared to go to any lengths to win the Al Yamamah contract, including ‘swallowing sheep’s eyeballs as if they were canapés’ to ingratiate himself to the Saudis.30 Evans had started work at the Ministry of Transport in 1960, before moving on to the Ministry of Technology. He soon entered the revolving door between government and the private sector when he joined the defence electronics company Ferranti, in 1967, as a government contracts officer. Two years later he joined BAC, one of the companies merged to create BAE, rising to become commercial director for the Warton Division of BAE in 1978. In 1983, Evans was appointed deputy managing director for BAE Warton.
Evans’s career was made when he was posted to Saudi Arabia as head of operations, making him the point-man when it came to negotiating the Al Yamamah deal. His vast network of contacts in the kingdom was the stuff of legend. The success of the deal led to his appointment as chief executive of BAE in 1990, and he became chairman in 1998. During his reign, a City analyst commented that ‘BAE is run by a “mafia”, that Dick is the head and that they are a law unto themselves’.31 A former employee suggested that ‘he is a very affable guy and is very well liked … but there’s a ruthless side – you need to count your fingers after you have shaken hands with him’.32
But the real star of the Al Yamamah show was Prince Bandar bin Sultan. As his name implies, Bandar is the son of Prince Sultan, the Saudi Defence Minister, Crown Prince and heir-apparent to the throne if his health holds. Bandar was born in March 1949 to a sixteen-year-old servant named Khizaran. Sometimes described as a family slave, Bandar has referred to his mother as a concubine.33 Though under sharia law all sons are born equal, Bandar has always seen himself as an outsider, the illegitimate child among his thirty-two half-brothers and half-sisters. As a young boy he had very little contact with his father, living instead with his mother and aunt. Fortunately for the young Bandar his grandmother, Princess Hussa, the influential favourite wife of King Abdul Aziz, took a shine to him, brought him to live with her and persuaded Prince Sultan to recognize his illegitimate son.34 So when Bandar was aged eleven he and his mother moved into the palace with his grandmother,35 a development he described as ‘a practical decision, but it completely altered my life’.36 Prior to his arrival at the palace his was a relatively simple childhood spent playing barefoot in Riyadh’s dirt streets, making his own toys in a house that was only partially electrified.37 This has led the flamboyant and now very wealthy royal to describe himself as the ‘peasant prince’.38
Bandar attended school at the Institute of Riyadh, rather than following many family members to Eton, in what might have been a reflection of his lower status.* In his semi-authorized, sometimes hagiographic biography of Bandar, the writer William Simpson quotes a school friend, now General, Mifgai, saying of Bandar: ‘he had a superb academic record. He was also a very popular student … charming, outgoing, and was fun to be around. He was a mature, placid, and well-balanced young man. He was slow to anger and never lost his temper, choosing instead to ignore someone and walk away.’39
A combination of being around military men from when his father was made Defence Minister in 1962, the mood of patriotism sweeping the Saudi royal family during their intervention on behalf of the royalists in the Yemeni civil war and a desire to impress his father motivated Bandar to pursue the prestigious career of a fighter pilot. He said of his choice: ‘When you’re flying an airplane, it doesn’t matter who you are. An airplane doesn’t know if you’re Prince Bandar or no. Either you know what you’re doing or you don’t. If you know, you live; if you don’t, you kill yourself.’40
Bandar faked his age on the application to gain entrance to the Royal Air Force College at Cranwell in England.41 Prince Sultan bought his son a white Mercedes for his English sojourn, which Bandar promptly crashed. He replaced it with an Aston Martin, which he would drive to London at the weekend and if stopped would show a Saudi driving licence and claim diplomatic immunity. Bandar’s training sergeant recounts that ‘he had a drawer for parking tickets picked up in London, which were never paid, and he had a set of CD plates [Corps Diplomatique] which he used to stick on the car for weekends’.42
There were differing opinions of the Prince’s flying prowess. On the one hand he flew solo for the first time after only nine hours’ training, but a fellow pilot and friend John Waterfall bluntly opined that ‘he was pretty shit at Cranwell’.43 In one incident, Bandar joined the airfield circuit in the wrong direction, flying against the flow of the other air traffic. His flying instructor, Tony Yule, reported: ‘Sultan flies with spirit and enthusiasm. He has had a problem in the circuit, but was coping quite well by the end of the course.’44
After graduating from Cranwell in 1969 Bandar joined the Royal Saudi Air Force as a Second Lieutenant stationed at Dhahran, where he was trained by American instructors under the Peace Hawk training programme.45 He was complemented for his charisma and leadership as a company commander. Unlike other royalty in the military, Bandar preferred to use his rank of Captain or Major, rather than being addressed as ‘Prince’. He only started using his title again when he became ambassador to the US.46 Despite this supposed humility, Bandar maintained his status by insisting that all his fellow pilots stand when he entered a room.47 In 1970, he trained in the US, spending time in Texas, South Carolina and Arizona for training on the F-102 and the F-5A/B fighter aircraft that were being brought into the Saudi Air Force.48
On his first day in America, while changing planes in Dallas, Bandar encountered a rowdy group of American football players from the Dallas Cowboys. Though the players were attracting a lot of attention in the airport terminal, what really caught Bandar’s eye were the ‘magnificent’ cheerleaders. From that day on Bandar was an avid Cowboys fan, a fixture at their home matches as a guest of the owner, before he bought himself a $500,000-a-year private box. He is so well known to the team’s players that they refer to him simply as ‘the prince’. In turn, Bandar describes himself as ‘their number one international cheerleader’.49
In 1972, stationed again in Saudi Arabia as an F-5 pilot, Bandar married Princess Haifa bint Faisal bin Abdul Aziz Al-Saud. Princess Haifa is one of the daughters of the then ruler, King Faisal. The following year, with the outbreak of the Yom Kippur War, Bandar was part of a group of pilots ordered to attack Israeli oil and refinery installations near the Jordanian border. Expectations were that as many as nine out of ten pilots could be killed on the mission. Bandar recalls: ‘We had got as far as the end of the runway preparing to launch; it was the real attack when we received [an] eleventh-hour reprieve.’ Henry Kissinger had negotiated a ceasefire that may well have saved Bandar’s life.50 The Prince and his wife returned to the US in 1974 so that the pilot could undergo training on the new F-5E aircraft. Over the next few years he trained pilots on the new jet in Saudi Arabia.
Prince Bandar’s success as a pilot, a trainer and a commander of pilots clearly pleased him. A biographer observed that ‘it really appealed to [his] ego and self-satisfaction’ to know that he could fly a hundred feet above the ground, roll the aircraft 360 degrees and not kill himself.51 In 1977, his passion for stunt flying almost proved his undoing as his landing gear failed at an air show in Abha, south-west Saudi Arabia. Rather than eject as he had been trained to do, the Prince attempted to land the plane on its belly. He hit the runway hard, seriously injuring his back, a lifelong problem that would eventually end his flying career.
In April 1978, Bandar, then twenty-nine and still focused on his Air Force career, was travelling back to Saudi Arabia from California when he stopped overnight in Washington DC. Crossing the lobby of the fashionable Madison Hotel, a favourite haunt of wealthy Saudis only five minutes’ walk from the White House, he ran into his brother-in-law, Prince Turki al-Faisal.52 Once Bandar had explained that he was homeward bound from an Air Force mission, Turki responded: ‘you know, you came to me from heaven. I need you.’ At the time, Turki was leading the lobbying effort to persuade the US to sell sixty F-15 fighter jets to the kingdom. Bandar was taken upstairs to a room full of American advisers and PR experts, who bombarded the young Air Force Major with questions about Saudi Arabia’s military need for the F-15. He responded that the fighter was essential to protect oil infrastructure and the holy sites of Mecca and Medina, as well as to counter the threat from Marxist South Yemen. He adroitly dodged questions about the fighter being a threat to Israel, avoiding any mention of the deployment of jets at the Tabuk base within reach of the Jewish state.
Bandar so impressed Turki and the American advisers that he was asked to stay on. The following day he was taken to see Senators John Glenn and Barry Goldwater, two key members of the Senate Armed Forces Committee and former pilots, who were favourable to the sale of the jets. He then met with Senators Frank Church and Jacob Javits, who were opposed to the sale. Bandar found traipsing from one office to another answering mostly hostile questions ‘boring work’ and wanted to go home to his wife.53 However, Turki called Crown Prince Fahd, asking for Bandar to stay on. Fahd agreed and when Turki passed on the royal order, Bandar simply didn’t believe him and responded: ‘No, thank you. I’ve stayed two days to help you as a friend and colleague.’ He headed to Paris to join his wife but the next day received a phone call from Crown Prince Fahd, ordering him to ‘report to the White House’ to help win the vote on the F-15 sale.54 Bandar had only been to the White House as a tourist in 1973 while stationed in Alabama. On this occasion, ‘I went to the White House, and Hamilton Jordan [Chief of Staff] took me in to see President Carter. Suddenly, there I was sitting in the Chief of Staff’s office, and they take me to the Oval Office. I left really in a daze.’55
Bandar was needed because legislation passed in 1974 required the support of Congress for all arms sales over $25m, with thirty days’ advance notice. While the administration’s priority lay in securing the country’s oil supply through as close an alliance as possible with Saudi Arabia, the powerful pro-Israel lobby led by the American Israel Public Affairs Committee (AIPAC) was highly active in lobbying against arms sales to hostile, or potentially hostile, Arab nations. AIPAC literature described the F-15 as ‘the most advanced air-superiority fighter in the world’, claiming the aircraft would enable the Saudis to ‘strike deep into Israel’.56 The Carter administration had inherited President Ford’s secret 1976 commitment to sell Saudi Arabia the F-15s to replace the ageing British Lightning interceptors and renewed the pledge during a visit by Crown Prince Fahd to Washington in May 1977.
The original informal deal was to sell sixty F-15s to Saudi Arabia, balanced by the sale of seventy-five F-16s to Israel and fifty F-5s to Egypt. Congress was only notified of the deal on 18 April 1978, setting the thirty-day clock ticking as Bandar was ordered to lead the lobbying effort. The Saudis had employed a selection of experienced US political advisers, including Frederick Dutton, who had been President Kennedy’s Special Assistant for Intergovernmental Affairs and Assistant Secretary of State for Congressional Affairs; John West, a former Governor of South Carolina and Carter’s ambassador to Riyadh; and David Long, a State Department Middle East specialist and professor of International Affairs.57 Dutton would remain a close companion and political adviser to Bandar for the next twenty-seven years, earning the nickname ‘Fred of Arabia’ among the Washington Press Corps. Dutton’s wife, Nancy, undertook legal work for the Saudi foreign ministry in Washington at the time and was still working as the Saudi embassy’s legal adviser in late 2007.58
Bandar quickly learned the Washington lobbying game. His ambition was to adopt the tactics of the hugely successful AIPAC, to create a rival Arab lobby.59 The difficulty of Bandar’s task was made clear by a study carried out by Carter’s staff indicating that AIPAC could count on 65–75 votes in the Senate whenever needed. Bandar – whom John West, the ambassador to Riyadh, described as ‘the best thing that happened to the F-15 fight’60 – set about building a constituency for the sale. The Saudis decided to communicate personally with as many AIPAC-supporting Senators as possible and contacted McDonnell Douglas (since merged with Boeing), which made the F-15, and many other contractors, subcontractors and labour unions to lobby Congress in favour of the sale. Bandar was the PR point-man to the media, members of Congress and influence peddlers.
As part of the lobbying effort Bandar visited the former Republican Governor Ronald Reagan, then plotting his presidential bid. He had no idea who Reagan was, which highly amused Carter. They hoped Reagan might support the sale, persuading fellow Republicans on the basis of Saudi Arabia’s strong anti-communist credentials. Bandar contacted Thomas Jones, the chairman of the F-5’s maker, Northrop Grumman, and a close friend of Reagan’s, and was soon invited to see the Governor in California. As Bandar tells it:
I sat down with Governor Reagan, and we chatted a little bit. Then I explained why we needed the aircraft. He said to me at the end of it, ‘Prince, let me ask you this question. Does this country consider itself a friend of America?’ I said, ‘Yes, since King Abdulaziz, my grandfather, and President Roosevelt met. Until now, we are very close friends.’ Then Reagan asked a second question. ‘Are you anticommunist?’ I said, ‘Mr. Governor, we are the only country in the world that not only does not have relationships with communists, but when a communist comes in an airplane in transit, we don’t allow him to get out of the airplane at our airport.’61
Bandar says he was expecting a long discussion about the sale but ‘That was it. Two things were important. Are you friends of ours? Are you anticommunist? When I said yes to both, he said, “I will support it.”’ Bandar then asked Reagan to voice his support to a reporter from the Los Angeles Times whom Dutton had tipped off. According to Bandar, the reporter asked: ‘Do you support the sale of the F-15s to Saudi Arabia that President Carter is proposing?’ Reagan responded: ‘Oh yes, we support our friends and they should have the F-15s. But I disagree with him [Carter] on everything else.’62
While campaigning, Bandar also met Senator Russell Long, the powerful Chairman of the Finance Committee and son of the notoriously corrupt Senator and Governor of Louisiana, Huey Long. Bandar was surprised when Long asked to have the meeting with no aides present. As soon as they were alone the Senator said: ‘You want my vote, don’t you?’ ‘Yes,’ responded Bandar. ‘It will cost you ten million,’ said Long, putting an arm around Bandar and easing him into a chair. ‘Did I shock you?’ asked the Senator, before explaining that the money wasn’t for himself but for a bank in Louisiana that was a major backer of his re-election campaign. In order to be certified to transact abroad the bank required a $10m foreign deposit. Bandar agreed to ask the Saudi government. It is unknown whether the transfer was made. Long voted in favour of the F-15 sale and was re-elected but died in 2003 without confirming the story.63
The vote was won 55–44 by the Saudis, with the sale authorized on 15 May. John West praised Bandar for his ‘boundless energy’ and ‘utter politeness and courtesy’ in his dealings with members of Congress. He told Crown Prince Fahd that ‘Prince Bandar evinced such enviable maturity as to rank him among prominent international statesmen and diplomats.’64 While Bandar certainly galvanized the Saudi intervention, it would have been largely irrelevant without President Carter’s personal lobbying effort, along with many members of his Cabinet.
* * *
After the F-15 campaign Bandar returned to Saudi Arabia and his duties in the Air Force. He maintained his friendship with John West, with whom he would often discuss US politics and the Middle East peace process. In autumn 1978, Carter and Crown Prince Fahd used Bandar to ferry messages between Washington and Riyadh. In the first instance they concerned the relationship between Saudi Arabia and Anwar Sadat, the Egyptian President ostracized in the Arab world after his Camp David peace deal with the Israelis. The offer was rejected by Fahd, who responded: ‘We will sort out our problems with Egypt directly, not with you.’65 But Bandar had been initiated into the craft of secret diplomacy and had developed a closer relationship with his uncle, the Saudi heir. Before long Fahd, who was the de facto ruler, made Bandar his personal ambassador to Washington.
The Prince returned to the US as an Air Force officer in 1979, initially to Maxwell Air Force Training School in Alabama. But John West and David Long arranged a special programme for Bandar at Johns Hopkins University in Washington.66 A memorandum from May 1979 showed that Long was acting ‘with the encouragement’ of the White House Chief of Staff, Hamilton Jordan, and the Secretary of State, Cyrus Vance.67 The special programme allowed Bandar to commute twice a month from Alabama to undertake one-to-one tutorials with professors who were paid extra for the sessions. He took courses in international economics and politics, leading to a masters degree in International Public Policy with a thesis on the domestic origins of US foreign policy, on which he almost certainly received help from Fred Dutton.68
President Carter’s re-election campaign in 1979 commenced amid spiralling global oil prices. With Bandar’s help, Carter drafted a letter to Fahd requesting Saudi Arabia to put more oil on the market.69 Fahd responded: ‘Tell my friend, the president of the United States of America, when they need our help, they will not be disappointed.’70 He promised to do ‘anything in his power externally or internally to ensure your re-election’, since this was ‘essential if there was ever to be a just and lasting peace in the Middle East’.71 This assistance, which saw Saudi oil trading $4–5 a day below other suppliers, cost the kingdom $30m to $40m a day. In gratitude, Carter invited Bandar to the White House in early December 1979, where they discussed Middle East politics and the US–Saudi relationship.
With Carter’s earlier request for Saudi–Egyptian rapprochement still in mind, Bandar took it upon himself to meet the then Egyptian Vice-President, Hosni Mubarak, in Washington DC in November 1979. Bandar had neither the permission of the Saudi government nor prior authorization from Fahd, although the Crown Prince approved the continuation of the initiative after the meeting.72 Bandar’s idea was for Carter to ask Fahd to write a conciliatory letter to Sadat, which would be delivered in person in Washington when the Egyptian President was meeting with Israel’s Menachem Begin and Carter. Fahd initially hesitated but then wrote the letter just in time, allowing Bandar to walk into the meeting between Carter and Sadat and present it. Bandar had, however, altered Fahd’s letter to make it more conciliatory. He defended his actions audaciously, claiming: ‘I knew what Fahd wanted to say, and needed to say, so I translated it that way.’73 Bandar’s high-risk creative diplomacy failed in this instance, as Egyptian–Saudi reconciliation remained elusive. But it revealed a great deal about the intermediary.
In 1980, Saudi Arabia’s dependence on the US increased further when the kingdom’s woeful human rights record and unequal, sometimes violent, treatment of women was highlighted by the broadcast of Death of a Princess in the UK. The film dramatized the story of a young princess from a fictitious Middle Eastern Islamic nation and her lover who had been publicly executed for adultery. It was widely believed to be based on the tragic story of Princess Misha’al bint Fahd al Saud, grandniece of King Khalid. Princess Misha’al had been shot dead, kneeling on the ground of a Jeddah car park in 1977 and her Lebanese boyfriend, Khalid Mulhalal, beheaded. The Saudi royal family attempted to cover up the deaths, claiming the Princess had died in a ‘swimming pool accident’.74 The airing of the drama incensed the Saudis, casting an icy chill on UK–Saudi relations and leaving the Saudis few alternatives to the US for their defence needs.
The Saudis were keen to purchase aerial refuelling tankers from the Americans to extend the capabilities of their F-15 fighters. However, the effort was stymied by an AIPAC-organized letter signed by seventy Senators. The outbreak of the Iran–Iraq War in 1980 changed the situation. In response to Saudi concern that the conflict could spread towards their country, and with Bandar again acting as intermediary, the ambassador, John West, asked Prince Sultan if the Saudis ‘wanted equipment such as AWACS and an anti-aircraft Hawk missile battery’.75 The exchange initiated an epic battle that would dominate the early days of the Reagan era.
AWACS was the most sophisticated control, command and surveillance system yet developed. No non-NATO country had access to it, not even Israel. The system is essentially a military aircraft based on a Boeing 707 jet with a distinctive radome over its fuselage. Bandar arranged for the top Saudi brass to be taken up in the aircraft, convinced that once they experienced it, there would be no talking them out of it. ‘Like selling them a new car.’76 The Carter administration, though not yet willing to sell the AWACS system, did send four manned AWACS to Saudi Arabia as a show of commitment to Saudi security. A potential diplomatic storm about whether Saudi Arabia requested the aircraft or the US offered them was averted by Bandar, who suggested that the press releases in Arabic and English provide different versions of the story. The gesture so pleased Fahd that he was willing to approve ‘just about everything’ the Pentagon requested in Saudi Arabia – pre-positioning of war matériel, joint military planning and access to Saudi bases for the AWACS. Apparently both Fahd and Prince Abdullah, at the time commander of the National Guard, travelled to Mecca to offer special prayers for Carter’s re-election.77
Their prayers were in vain as Ronald Reagan swept to power in the 1980 election. As the only Saudi royal to have met Reagan, Bandar was chosen to make first contact with the new President. When the Secretary of State, Alexander Haig Jr, visited Saudi Arabia in April 1981 to drum up support for the anti-communist crusade, he was told that the Saudis’ key concerns were the Palestinian issue and the acquisition of the AWACS system. While discussing the problem of getting the sale past Congress, Haig suggested that ‘maybe Prince Bandar could come back and help with Congress’. Fahd agreed.78 Bandar was now officially the chief Saudi lobbyist with a royal mandate.
The Reagan administration believed that the AWACS sale ‘was important to strengthen ties with this relatively moderate Arab country, not only because its oil exports were essential to our economy, but because, like Israel, it wanted to resist Soviet expansionism in the region’.79 But Israel clearly felt that the arms sale threatened it, not only because the AWACS system would enable the Saudis to track Israeli military movements, but also because Reagan intended to include upgrades to the F-15 that would enhance the fighter, making it capable of strike missions against Israel. This ensured that Congressional debate on the sale was dragged out for nine months.80 The outcome was always going to be close. Fred Dutton, Bandar’s adviser, came up with the crude slogan for the campaign, ‘Reagan or Begin’. It proved apposite as the Israeli Prime Minister, Menachem Begin, made life difficult for the Israel lobby. First he ordered the bombing of the Osirak nuclear reactor in Iraq without informing the Reagan administration beforehand. And then, after being asked by the new President not to lobby on the AWACS deal when he visited the US during debate on the issue, he proceeded to do just that outside the White House gates.
Bandar was again the point-man on the deal, still only thirty-two and not even an accredited diplomat. Newsweek described how he had ‘dazzled senators with his grave wit and charm’. The Prince had taken up regular squash matches with General David Jones, the Chairman of the Joint Chiefs of Staff, and took to mimicking aerial dogfights with John Glenn, a Democratic Senator and former pilot and astronaut, as if they were ‘old pilot buddies’.81 He became closely acquainted with James Baker III, Reagan’s Chief of Staff who would one day be President George H. W. Bush’s Secretary of State, and at one point was involved in negotiating between King Khalid and President Reagan about the type of compromises that might secure the sale.82 A compromise was eventually struck to sell the AWACS on the condition that there would be sharing of information with the US, and various safeguards were included to prevent third parties from accessing the system. The deal, together with other initiatives to extend its military influence in the region, would culminate in the US using the kingdom as a launching pad for the First Gulf War.
Soon after the successful AWACS sale Bandar was named Defence Attaché to the Saudi embassy in Washington DC. While the job was usually the kiss of death for a military career, Bandar took the assignment to be a test of his abilities on the part of King Khalid.83 He undertook his new role just as Israel began its massive invasion of Lebanon, hoping to drive out the PLO and eliminate Yasser Arafat. A week after the invasion King Khalid died, to be succeeded by Bandar’s uncle and mentor, King Fahd, in June 1982. Bandar claims that, at the time, he was at the centre of negotiations to allow the PLO to evacuate Lebanon, though neither Reagan nor his two Secretaries of State give the Saudi more than a passing mention in their recollection of the events. Whatever his role in this instance, it was hardly a surprise when on 24 October 1983 Prince Bandar was made the Saudi ambassador to the United States.
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As the new emissary was presenting his credentials, President Reagan cut him short. ‘You know something? You came a long way. When I first met you, you were a young major in your air force. And now, you are an ambassador of your country to the United States of America.’ Bandar responded: ‘Well, Mr. President, you didn’t do too shabbily yourself. When I first met you, you were an unemployed governor, and now you’re president of the greatest country in the world.’84
Bandar had such regular access to the Reagan White House that, at one point, the Israeli ambassador to Washington complained.85 The Saudi would prove to be of great value to the Reagan administration, believing that by assisting the administration internationally and domestically he could act as a counterweight to the powerful Israel lobby.
An opportunity soon arose to demonstrate his worth in the Iran–Contra scandal. As mentioned, in 1984, despite Congressional rulings forbidding the US government from providing material support to the right-wing Nicaraguan Contras, President Reagan and his National Security Planning Group were committed to aiding the rebels in order to prevent the spread of communism in Central America. Reagan directed his National Security Advisor, Robert McFarlane, to ‘keep the Contras together body and soul’. In essence, the proceeds of illegal weapons sales to Iran through Israel – which broke US law and undermined America’s own campaign to cut off arms sales to the Khomeini regime – were used to fund the Contras.
This complex arrangement took time to implement. In the interim, after Congress withdrew funding from the Contras, McFarlane asked Prince Bandar to make up the shortfall. After meeting with McFarlane and the Defense Secretary, Caspar Weinberger, Bandar ensured that the Contras received $1m a month from mid-1984. At a breakfast meeting with Reagan in early 1985 King Fahd offered to double the remittances. Over time, the Saudis gave $32m to the Contras.86 The routing of this money was linked to the AWACS sale in that a fund was created from the sale, from which the Contras’ monthly money was diverted.87
Bandar would say later: ‘I didn’t give a damn about the Contras – I didn’t even know where Nicaragua was.’88 This support was the Saudi way of investing in America, the ultimate aim being a Saudi–American alignment to compete with Israel’s relationship with the US.89 The strategy was further oiled by the Saudis’ legendary schmoozing. King Fahd, as confirmation of his support for the American cause, lavished Arabian horses and diamonds worth $2m on the President and First Lady. Bandar was inventive in ensuring that the gifts became the personal property of the first couple rather than, as protocol demanded, being accepted and registered on behalf of the American people. Bandar, who was particularly close to Nancy, helped the family in countless ways. When Nancy asked him to employ Michael Deaver, the powerful Deputy Chief of Staff to the President who was leaving the White House broke, with legal problems and drinking heavily, Bandar hired him as a consultant for $50,000 a month, even though he had absolutely no contact with him throughout the year that he was on the payroll.90
Given Saudi willingness to provide covert assistance on Iran–Contra, Caspar Weinberger attempted to hide their involvement when the scandal was investigated by Congress.91 On 31 July 1987, Weinberger was questioned about a conversation he had with the CIA’s Director, William Casey, at their weekly breakfast meeting, in which it was mentioned, and memo’d, that Prince Bandar had earmarked $25m for the Contras in $5m increments. Weinberger suffered severe memory loss throughout the hearings, claiming he couldn’t remember saying it. General John (Jack) Vessey, Chairman of the Joint Chiefs of Staff at the time, contradicted the Secretary, confirming that Weinberger had ensured $25m for the Contras. In addition, Vessey revealed in a 1992 interview with counsel in the investigation that Bandar had twice told him about his contribution. One of the conversations took place in a White House meeting on 25 May 1984 about the AWACS sale at which Robert McFarlane was present.92 It transpired that Weinberger kept diary entries of a number of these conversations and had noted at least sixty-four contacts with Bandar, including sixteen meetings at the Pentagon.93
The Secretary of Defense was indicted for perjury and obstruction of justice but given a presidential pardon by George H. W. Bush in 1992. Bandar also denied involvement, claiming in a 21 October 1986 press release that ‘Saudi Arabia is not and has not been involved either directly or indirectly in any military or other support activity of any kind for or in connection with any group or groups concerned with Nicaragua.’ When his lies were revealed Bandar defended the actions, claiming that they ‘broke no US law per se’.94 This was yet another lie, as Congress had explicitly prohibited soliciting donations for the Contras from other countries. Casey had effectively used the Saudis as proxies to do what Congress had banned. Though the evidence led to senior officials including Weinberger and the notorious Colonel Oliver North, Casey was careful to protect himself by never discussing the matter with the Saudis. Bandar also avoided a banking paper trail by flying to Switzerland to have his own bank transfer money into Cayman Island accounts, en route to the Contras.95 The Prince, who had diplomatic immunity, refused throughout to cooperate with investigators. Revealing his cavalier attitude to the truth, Bandar voiced his disappointment at the exposure of the Saudi role to McFarlane: ‘I don’t care what the truth is: if you’re going to tell some story, let’s tell it together. If it’s a lie, then let’s lie together.’96
The Saudis also funded Jonas Savimbi’s brutal UNITA forces in Angola, who, with the substantial backing of the nearby apartheid regime, were trying to overthrow the communist MPLA government. A Palestinian-American businessman, Sam Bamieh, testified before the US House Subcommittee on African Affairs that he had met Fahd in 1981 and was told by the then Crown Prince that if they received the AWACS the Saudis would be willing to fund ‘anti-communist movements around the world’.97 Bamieh testified that Bandar was put in charge of making it happen. He and Bandar, therefore, met in February 1984 in Cannes, France, to discuss setting up a shell company to funnel money to the Angolan rebels and to Afghanistan. Bandar told Bamieh that, as they were meeting, Casey and Fahd were discussing the same issue aboard the royal yacht. Bamieh claimed the Saudis had provided over $50m, through Morocco, to fund the Angolan rebels.
Bandar’s next covert mission allegedly came at the request of William Wilson, the US ambassador to the Vatican and a close friend of Reagan. According to one account, Bandar was asked to provide and deliver $2m to the Italian Christian Democratic Party to help prevent the feared victory of the communists in the 1985 elections.98 The Saudi ‘donation’ was packed in a suitcase with which Bandar then supposedly flew to Rome in a private Airbus. He personally took it in a Saudi diplomatic car to the Vatican Bank, where a priest came to the bottom of the stairs to take delivery of the suitcase, without a question being asked. The Vatican distributed the money to the Christian Democrats, who ultimately triumphed at the polls by 4 per cent of the vote.99 The veracity of this account is difficult to discern as it has only been told to four people, three at the Washington Post and William Simpson. The ambassador, Wilson, denied all knowledge of the events, saying that if it happened ‘it sure took place without my knowledge’.100 Simpson claims the plan was cooked up by Reagan, Fahd and Thatcher, and Bandar’s involvement was so that ‘it was done with a deniability factor, because you would never see American fingerprints – or the British – on it. The money didn’t come from them. They didn’t authorize it through Congress or Parliament. Everybody could say, “I had nothing to do with that; it’s nothing to do with me”, but yet that’s the way things got done … This was a classic example of how strategic cooperation took place between Reagan, Fahd and Thatcher in many, many ways.’101
Had Bandar become a bagman for the Pope? If there is any truth to the story it would render deeply hypocritical Bandar’s court statement in 1993 when he sued the Guardian newspaper for libel, after the paper claimed in error that he had secretly made donations to the Conservative Party. Bandar told the court that the mere idea that he should seek to influence an election in another country caused him extreme ‘embarrassment and distress’.102
On 8 March 1985, a massive car bomb exploded outside a mosque near the apartment of Sheikh Mohammed Hussein Fadlallah, the spiritual leader of the newly formed Hezbollah. It killed eight people and injured at least 200 more. Many of the victims were worshippers leaving the mosque. Fadlallah was unharmed. The acclaimed Washington Post reporter Bob Woodward claims that William Casey and Prince Bandar had conspired to carry out the attempted assassination, hiring a former British commando, who was paid $3m by Bandar.103 The Saudi strenuously denied the accusation, which Woodward repeated in a 2001 Frontline programme. The reporter claims that during ‘a stroll in the garden’ at Bandar’s residence in McLean, Virginia, he and William Casey agreed that the Saudis would ‘put up the money to hire some professionals to go and try to car-bomb Sheikh Fadlallah’. Casey said the operation would be ‘off the books’ so that not even Reagan would know about it.104 Supposedly, exposure of the abortive operation cost Bandar the job he wanted in Riyadh at the time, as National Security Adviser.105 Bandar steadfastly maintained that allegations of Saudi involvement in the attempt on Fadlallah’s life were completely without foundation and he stated explicitly that he played no role in the endeavour.106
The Saudis spent several billion dollars on arms and economic assistance for the war in Afghanistan against the Soviets, and worked with the CIA to fund Afghan madrassas in the 1980s.107 Prince Bandar claims that he also played an essential role in convincing President Gorbachev to withdraw from Afghanistan. On a visit to Moscow in 1988 Gorbachev told the Prince that the Russians knew the Saudis had been providing $200m every year to the mujahideen. Bandar responded: ‘You are absolutely wrong, Mr. President. We are paying five hundred million, not two hundred million, and we’re willing to pay a billion if you don’t get out of Afghanistan.’108 Bandar suggests that Gorbachev almost immediately agreed to leave Afghanistan by the following March. Whatever the truth of the content of the discussions, Bandar came away with a remarkable souvenir, a photo of Gorbachev and Reagan with the words ‘Trust But Verify’ written on it, a favourite phrase of Reagan’s. Gorbachev gave Bandar one of only fifty copies of the photo in existence. The next time Bandar saw Reagan the Saudi asked: ‘Why do you think he gave it to me, Mr. President?’ ‘What did he tell you?’ asked Reagan. ‘He said, “I want you to know I’m a friend of your friend, too.”’ Reagan then wrote on the photograph: ‘Prince Bandar, Trust But Verify’. When Bandar next met Gorbachev a few years later he too wrote on the picture in Russian: ‘Doverey no Proverey’. Bandar kept this photo on prominent display in his office for many years.109
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Prince Bandar has the ability to charm the powerful and his country’s money with which to buy friendship and influence. He is comfortable and inventive at circumventing laws and restrictions and has on occasions appeared to be loose with the truth. This made him the ideal person to negotiate the world’s ultimate arms deal.
As Bandar has said, Mrs Thatcher was very accommodating of the Saudis’ weapons needs. While the US option was not open to them and the French had done themselves a disservice by purchasing more Iranian oil, another factor that influenced the Saudi decision to buy British was the most base of all: money. The deal is probably the most corrupt transaction in arms-trading history, with Bandar, Thatcher’s son and many others implicated in receiving payments on an epic scale.
As Bandar recalled to Nihad Ghadry, a former adviser to the Saudi royal family: ‘I told her [Mrs Thatcher] that this deal is between us directly, between the two countries. It should go no further. Whatever is related to us is our concern and no one else’s … I also told her that we are a royal family and around us are a lot of people and a lot of responsibilities. My conversation with Mrs. Thatcher ended with her understanding what I meant.’110