THE British arms firm BAE Systems secretly paid nearly £250,000 for a honeymoon for the daughter of Prince Bandar, the Saudi Arabian prince at the centre of bribery allegations.

A senior BAE executive authorised the payments, allowing Bandar’s daughter to enjoy a six-week honeymoon in luxury resorts in Singapore, Malaysia, Bali, Australia and Hawaii. The couple stayed in five-star hotels costing up to £4,000 a night and had a private jet trip to the Great Barrier Reef.

Peter Gardiner, managing director of the travel agency that organised the honeymoon, said: “BAE instructed me to give Bandar's daughter and her husband the honeymoon of a lifetime at BAE’s expense. Who says that big business doesn’t have a heart?”

The disclosure is the first evidence that Bandar and his family may have benefited from secret payments made by BAE. The company and Bandar, who was Saudi Arabia’s ambassador to Washington at the time, have denied any impropriety.

Background

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Last week Bandar insisted that claims by BBC’s Panorama that he had benefited from payments of more than £1 billion allegedly given to him by BAE were “grotesque in their absurdity”. The cash was reportedly used to buy an Airbus 340 jet and refurbish his official residence in Saudi Arabia. He insists that they were approved by the Saudi defence ministry and were given to him in his capacity as a government minister.

However, the honeymoon for Bandar’s daughter, Princess Reema, was paid for through a £60m slush fund which the Serious Fraud Office (SFO) believes was set up by BAE to encourage Saudi royals to continue with a £43 billion arms contract to supply Hawk and Tornado jets.

The latest twist in the BAE affair has been disclosed by Gardiner, who said he has made a detailed statement to the SFO. He described how his company, Travellers World, was used by BAE to make payments to Saudi royals when they were holidaying around the world. His company would arrange and pay for hotels, airline tickets, apartments, boat and jet charters, as well as hiring limousines and bodyguards.

Gardiner had agreed to testify as the chief prosecution witness in an expected trial of BAE executives over the deal. The prosecution was halted last December after the Saudis threatened to suspend diplomatic and intelligence ties. Tony Blair has said he takes full responsibility for the decision, which has led to worldwide criticism.

Last week Gardiner said Tony Winship, a senior BAE marketing executive responsible for overseeing the slush fund, approved the costs of the six-week trip for Princess Reema bint Bandar and Prince Faisal bin Turki, the son of Prince Turki bin Nasser, another Saudi royal implicated in the SFO’s bribery inquiry.

“They were a young, attractive couple in love and on a dream honeymoon. They knew nothing about BAE paying and must have believed it was their parents paying. I was instructed by BAE not to discuss payments with them – or with anyone. I was told by BAE to give them the very best,” Gardiner said.

“The couple selected the itinerary. I chose and arranged the hotels, transportation, diplomatic arrivals. They never took advantage and any personal expenditure such as shopping they paid for themselves.”

The couple were married in Riyadh, the Saudi capital, in December 1996. They flew on Turki’s private Boeing 707, staffed by an English captain and crew, to Singapore. There they stayed for a week at Raffles, the country’s most exclusive hotel where suites cost from £500 to £2,800 a night.

They then travelled for a week’s stay to the Pangkor Laut resort on a privately owned island off Malaysia. It is often described as the best resort in the world. “The honeymoon suite was a two-bedroom, overwater bungalow with a partial glass floor so that guests could see the sea below them,” said Gardiner, who accompanied the royal couple during the early part of their stay. “They very much liked the suite.”

After a week in Malaysia, Bandar’s daughter and her groom flew by private jet to Bali where they stayed at the five-star Four Seasons Jimbaran Bay resort. They arrived in Australia and spent Christmas at the Regent hotel in Sydney. During that visit the prince who, like his father-in-law Bandar, is a fan of the Dallas Cowboys football team, was keen to watch a critical game. Gardiner says he found a private club in a town 60 miles away which could show the game live on cable TV. The entire club was hired in the middle of the night so that Bandar’s daughter and her husband could watch the match live. The three-hour stay cost £6,000. BAE again footed the bill.

The couple then flew to the Gold Coast where they stayed at the five-star Sheraton Mirage and Spa. On a day trip they hired a Gulfstream jet to fly to the Great Barrier Reef. The bill, paid by Travellers World and reimbursed by BAE, was £15,000.

Documents in the possession of the SFO show that Travellers World invoiced BAE £45,490 for the couple’s stay in Australia. The item is billed as “HM.Aus”, which Gardiner said was shorthand for “Honeymoon, Australia”. The couple moved on to Hawaii where they spent a few days at the Halekulani on Waikiki beach. From there they flew to the Grand Wailea, on the Hawaiian island of Maui, where their penthouse suite on a private floor cost about £4,000.

The files show one part of the bill for Hawaii was £101,412. The payments, again paid by BAE, appear as “HM. Haw.” and “HM Haw.Xtra”. For the month of January alone the cost was £190,486. According to Gardiner, this did not include the first leg of the honeymoon which began in mid-December the previous year. The total cost was nearly £250,000, he said.

A spokesman said Bandar was unavailable for comment. BAE denied any wrongdoing, adding that it does not and will not pay bribes or offer improper inducements.

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