The nature and extent of the Weir Group’s illegal trading with the former Saddam regime in Iraq was astonishing.
In short, the Group in a corporate prosecution, pled guilty last week to sanction busting by paying kickbacks to obtain contracts in Iraq and are now due to pay nearly £17 million in corporate fines. Yet, the guilty men – and they probably are men – have avoided identification and also, prosecution. Those at the top of the Weir Group helm have gone on to new prestigious roles, though one – the Group’s Chairman, Lord Smith of Kelvin – is still in situ. The international aid charity, War on Want has already called for the guilty men to be named and shamed. The burd agrees.
In fact, Lord Smith of Kelvin, should be made to resign, not only as Chairman of the Weir Group but from his role as chairman of the Glasgow 2014 organising committee. Our Commonwealth Games must not be tainted by even a hint of association with such a heinous crime.
For it was a heinous crime. The way to pay the kickback in order to be given access to lucrative contracts was to overcharge the United Nations Oil for Food (OFFP) programme. This meant that £3.1 million that should have gone to providing food and essential supplies to the Iraqi population was diverted into Saddam Hussein’s coffers.
The people involved in this activity have no place and should have no role to play in Scottish corporate activity nor in civic life. Unless the directors and managers involved are named and shamed, and thereafter barred from holding similar positions and/or struck off from any professional registers, they will be allowed to continue with their lives and careers as if nothing ever happened. Indeed, the Chief Executive, Mark Selway, who was in charge when the crimes were committed and who originally denied any wrongdoing, only left the company in November 2009. He is now Chief Executive of an Australian building firm.
The company was fined a paltry £3million by the High Court last week. The judge, Lord Carloway, took into account the fact that the Weir Group was willing to pay back the £9,4 million made in profit from the deals, the £3.1 million diverted from the OFFP and the £1.4 million paid to the Iraqi agent who was required to intercede to enable the deals to go ahead. However, the Weir Group plc – now restructured with its procedures overhauled – stands to make profits this year £50 million above expectations. The forecast profit for the second half of 2010 is £145 million.
£3 million, or indeed £17 million, is not even enough to make the Group’s directors catch their breath. The company should have been fined in accordance with the severity of the crime, not its willingness to mitigate its guilt.
Moreover, the Justice Secretary, Kenny MacAskill MSP, has suggested that some of the money will go into the Cashback for Communities programme used to fund projects to benefit communities blighted by crime but primarily, for activities to divert young people from anti-social behaviour.
Scotland should have no truck with this money. It is not ours. All of it – not some of it – should go back to the Iraqi people, for their benefit and investment in their communities. Their need is greater than ours, after all. The idea of using it as some kind of windfall for our benefit should not even be countenanced. It is distasteful in the extreme.
It would seem that the Weir Group plc has engaged in a charm offensive in recent months to effect its rehabilitation. A feature piece was carried by the Herald in May, interviewing the new Chief Executive, Keith Cochrane. The article held out the promise of sweeties for Scotland in the form of “hopes” by the company to spend more of its research and development budget in Scotland.
Remarkably, much of its research and development is conducted outwith Scotland and the company has only one partnership with a Scottish university, but the new Chief Executive “voiced his belief” that partnerships could be formed with more of Scotland’s higher education institutions.
Hmm. Any of this coming to fruition yet? It will be interesting to see if it does. Such measures would go some way to providing reparation to Scotland for the stain placed on its international reputation as a result of this case.
The Weir Group is one of the most famous names in Scottish manufacturing – it is clearly one of our global success stories and is indelibly linked to its Caledonian roots. Until we can be certain that all the miscreants involved in the sanction busting are no longer working for Weir Group or engaged in Scottish businesses in some capacity, we cannot be certain that a similar situation will not arise again. And without that certainty, Scotland’s reputation as a compassionate nation with a high standard of business ethics, at home and abroad, will remain tarnished.