Collapse of bribery case involving Alba deals blow to British watchdog

Britain’s Serious Fraud Office had accused Victor Dahdaleh, a former associate of former British leader Tony Blair and donor to Britain’s Labour Party, of making illegal payments of about US$67 million.

Aluminium blocks on stockpile at the Khalifa bin Salman port in Bahrain. Razan Alzayani / The National

The prosecution of a businessman who allegedly paid bribes to Aluminium Bahrain’s management, including a royal family member, has collapsed, dealing an embarrassing blow against Britain’s Serious Fraud Office (SFO).

The SFO had accused Victor Dahdaleh, a former associate of former prime minister Tony Blair, of making illegal payments of about US$67 million.

The payments were allegedly made to help secure contracts worth more than US$3 billion for western businesses between 1998 and 2006.

However, the case, which formally began on November 5, came to an abrupt halt on Tuesday, after the SFO’s lead counsel admitted there was no realistic chance of securing Mr Dahdaleh’s conviction.

The admission came after a key SFO witness changed his testimony, and two United States lawyers central to the prosecution’s case declined to be questioned.

Bruce Hall, Alba’s former chief executive, had already pleaded guilty to conspiracy to corrupt with Mr Dahdaleh and had given evidence for the prosecution.

But Mr Hall then proceeded to give an account in court that “differed markedly from the witness statement he had provided to the SFO”, according to the office. The change in Mr Hall’s testimony coincided with a request by two US lawyers, who were acting as witnesses for the prosecution, to put a limit on the extent to which they could be cross-examined in court.

Their request came after it emerged last week that Akin Gump, their law firm, was representing Alba in a civil case in the US, leading to concerns about fairness and conflicts of interest.

“After careful consideration of all of the circumstances of the case, the Serious Fraud Office has concluded that there is no longer a realistic prospect of conviction in this case,” the SFO said.

The presiding judge subsequently instructed the jury to return “not guilty” verdicts on all eight counts.

Mr Dahdaleh had admitted making payments to Alba’s management, but insisted that such payments were part of local business practices and were approved of by the Bahraini authorities.

The defence was made under Britain’s Prevention of Corruption Act 1906, the precursor to the much more stringent Bribery Act of 2010.

It emerged last week that Jamel Saleem Al Arayed, one of Bahrain’s five deputy prime ministers, had written to the SFO and Britain’s attorney-general last November to insist that the authorities had known and approved of the payments made to the member of Bahrain’s royal family.

The collapse of the SFO’s case comes seven years after the closure of its investigation of the Al Yamamah arms deal.