Friday, March 21, 2014

Tanks for the Memory

BRITISH Chieftains on parade. Argument over where they went and bill that was twice paid.

BACK in the early 1980s when circumstances forced me to take a security job, which was all I could get, about the only privilege for working long, boring hours, was entrance to some interesting buildings. Among the larger ones was a stately pile on Millbank, near Parliament Square, housing the offices of the Crown Agents, who supplied anything from postage stamps to pharmaceutical storage systems to overseas governments. It is now a private company with headquarters in Surrey.

Not far away, on Great Smith Street, was a neat, more modest unmarked building belonging to an offshoot of the Crown Agents, International Military Services(IMS). When I spent a night there my instructions included to check all desks in the reading room for any materials or documents that had been left out, and if I found any, to make a note of the location, then remove the items to a safe in the office. Had I been there during the day I might have seen visitors from various countries perusing manuals and catalogues of military hardware for export, much like you or I looking through an Argos catalogue.

At that time the Argentine junta had a naval purchasing mission in Victoria, as it seems HM government was very sportingly helping them prepare for the Falklands/Malvinas war. Other visitors who came on shopping trips had included both Iranians and Iraqis.

IMS, which also had a much larger modern building in Abbey Orchard Street, had been set up by Harold Wilson's Labour government in 1974, but its first chairman was Sir John Cuckney, a former director of Midland Bank, whose name later cropped up in the controversy over arms to Iraq. It was Midland Bank which had a special section devoted to military equipment sales, and which loaned large sums to Saddam Hussein's government. Any losses made when the regime defaulted or was brought down were covered by the British Department of Trade and Industy's Export Credit guarantees, in other words, the public.

However, our current story concerns arms to Iran.

Between 1971 and 1976, the Shah of Iran had ordered 1,500 Chieftain tanks and 250 repair vehicles costing £650 million. The shah's regime paid up front, which must have come in handy for the British government. But then in 1979,  with only 185 tanks delivered,  the Iranian Revolution deposed the Shah, and installed an Islamic Republic. The massive arms deal came apart, and the Iranians asked for their money back. But the British government had other ideas.

"We chose not to return the equivalent of £450 million that Iran had paid us," said Tory MP Ben Wallace. "Instead we sold the tanks to Saddam Hussein who then proceeded to use them against the people of Iran."

In 2010 it was reported that the Iranian government had won a longdrawn out court case ove this, and that Britain, more specifically IMS, was waiting for the Iranians to apply for their money, and would then pay it back. But by last year the money had still not been paid, possibly because of sanctions against Iran. The Foreign and Commonwealth Office granted visas to a group of Iranian officials to come and pursue their case for the funds in the courts here. But no sooner had the Iranians touched down at Heathrow than their passports were seized, their visas revoked, and themselves locked up as supposed asylum-seekers.

(This reminds me incidentally of another case, when a British diplomat who had been working in Iran was detained under the Prevention of Terrorism Act, and his home was searched, although he was never charged. It looked as though MI6 and MI5 might have been working at cross purposes).+

Ben Wallace, MP for Wyre and Preston North, is a former Army intelligence officer who also served as overseas director for QinetiQ, the now privatised MoD research and development company. He is chair of the All-Party Parliamentary Group on Iran. Speaking in a Westminster Hall debate on March 11, he urged that the money owed to the Iranians be released now that relations were improving. The MP also expressed concern that while the US government was issuing letters of comfort to assist US banks wishing to trade in Iran after sanctions were eased, British banks had no such protection from the long reach of Congress.

IMS is fairly dormant as a company now that arms sales are left to private companies, but it is being kept going to deal with cases like the Iranian claim, which could reach court here in June.

Meanwhile, according to Private Eye, the Treasury has Iran listed as owing the UK money on this deal, because the Shah borrowed part of the money for the deal from British banks, which were paid £28.44 million under our old friend the Export Credit Guarantee Department.


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