House of Commons - Foreign Affairs

Select Committee on Foreign Affairs Second Report

SANDLINE AND MR SPICER

26. Mr Spicer described Sandline as a "private military company."[81] The FCO defines private military companies as "private sector companies which provide operational combat support, military training and assistance, procurement services, military analysis and logistical support."[82] Sandline's business in Sierra Leone included the provision of arms, equipment and manpower.[83] It was in essence, a company of mercenaries. As far as its arms supplies to Sierra Leone were concerned, as Mr Murray told us, "the last thing that the region needs is more arms. The region is awash with arms."[84] At least one of the characters involved in Sandline's dealings was unsavoury: for example, Mr Rakesh Saxena, the financier who originally intended to finance the Sandline operation in Sierra Leone, and who was doing so in return for diamond concessions there, was described memorably by the Foreign Secretary as "an Indian businessman, travelling on the passport of a dead Serb, awaiting extradition from Canada for alleged embezzlement from a bank in Thailand."[85] Our attempts to uncover the structure, ownership and business connections of Sandline were met with extraordinarily evasive answers by Mr Spicer.[86] A follow-up memorandum from Mr Spicer was thin and opaque—and failed to provide a number of promised answers.[87] Nevertheless, Mr Spicer's business is not unlawful, and he is a British citizen with a record of service in the armed forces (for which he was appointed OBE).

Should Mr Spicer have known the law?

27. It is fundamental to Mr Spicer's case that he did not know that the supply of arms to President Kabbah was illegal. We have earlier shown that, even if the Order in Council was unambiguous, the scope of the UN resolution containing the arms embargo was not patently obvious. Nor did the material put out by the FCO explain the true position. Should Mr Spicer, with his knowledge of the area, nevertheless have been aware of the true position? Sir John Kerr could not understand this aspect of Mr Spicer's evidence: "if one is in the business of supplying arms it seems that the natural first thing one would do is to look at the law of the land and establish whether what one was doing was legal or illegal."[88] As Sir John pointed out, "Mr Spicer....operates with a firm of solicitors about him."[89] Mr Spicer argued that he had relied on a reasonable interpretation of the Security Council Resolution which would have allowed arms sales to President Kabbah and ECOMOG, but that he was ignorant of the Order in Council. He told us that he "did not know of the existence of the Order in Council until such time as Customs and Excise referred me to it."[90] We believe that it was an extraordinary omission by Mr Spicer and his legal advisers not to ascertain the position in law about the sale of arms to Sierra Leone. The Order in Council was not peripheral to the issue, and anyone familiar with arms embargoes, as Mr Spicer was, would have been aware that UN Resolutions are followed by domestic legislation. If Mr Spicer truly was not aware of the Order in Council, then his firm and their advisers are guilty of professional incompetence. It is the view of the Committee that Mr Spicer should have known the law about arms sales to Sierra Leone.

Mr Spicer and FCO officials

INTRODUCTION

28. However, let us assume for the purposes of argument that Mr Spicer failed to take adequate steps to ascertain the law directly governing his proposed arms sales. In this case, he argues not only that he was acting in good faith and in the best interests of President Kabbah, but that he had relied on the word of British officials—a reliance which proved to be misplaced.[91] They had led him to believe that nothing which he was doing was illegal. As he said, "we told them what we were going to do, and they understood exactly."[92] As far as his dealings with Mr Penfold were concerned, Mr Spicer emphasised that he did not distinguish his dealings with the High Commissioner from his dealings with other British Government officials.[93] It is common ground that Mr Spicer informed Mr Penfold of his intentions. The extent to which this information was full, and when and how it was relayed, are matters of dispute. As far as other officials in the FCO were concerned, there was a crucial meeting on 19 January 1998, attended by Mr Spicer, Mr Murray and his deputy, Mr Andrews. What passed at this meeting is hotly disputed.

MR SPICER AND MR PENFOLD

29. Mr Spicer told us that he made Mr Penfold aware over lunch on 23 December 1997 that he had concluded an agreement with President Kabbah which involved the supply of military equipment, and that he had handed a copy of the agreement to Mr Penfold, who had taken it away with him.[94] Mr Penfold had already been shown a draft of the relevant contract by President Kabbah on 19 December.[95] According to Legg, "although the contract did not expressly mention arms or weapons, Mr Penfold says that he immediately assumed that it included them, because of the size of the sum involved."[96] He confirmed this to us.[97] Mr Penfold, however, told us that he was "convinced" that he did not come away from the lunch on 23 December with a copy of the contract, though he was shown it and the discussion followed the lines Mr Spicer suggested.[98] According to Mr Spicer, a letter he had written to President Kabbah on 4 December was also shown to Mr Penfold.[99] Mr Penfold told us that he had never seen the 4 December letter.[100] He also believed that he had neither encouraged nor discouraged Sandline from the course they intended to follow, though Mr Spicer implied he had been rather more enthusiastic.[101]

30. On 28 January 1998, Mr Penfold visited Sandline's offices and was taken through their military plan. He was handed a copy of a strategy paper outlining Project Python.[102] According to Legg, Mr Penfold confirmed that he understood that Sandline were delivering arms and ammunition to President Kabbah.[103] For Mr Spicer, this was the culmination of a series of meetings which had brought FCO officials fully within the picture.[104] Mr Penfold handed the copy of the strategy paper to Mr Andrews of the FCO on 29 January;[105] he had no reason to suppose that Mr Spicer did not want him to do so.[106]

31. Unless Mr Penfold was complicit with Mr Spicer in not passing on information (and we have absolutely no evidence of this), the only fair conclusion we can draw is that Mr Spicer had every reason to believe that the FCO was aware of the nature of his business with President Kabbah because of his dealings with Mr Penfold. It would have been entirely reasonable of him to assume that Mr Penfold was acting with full authority of HMG. As Mr Spicer pointed out, the High Commissioner was the representative of Queen and Government in Sierra Leone.[107] If the FCO machine was working properly, once a matter had been reported to Mr Penfold, it had been reported to the Government.[108]

19 JANUARY MEETING

32. As to what actually happened at the meeting on 19 January, we are not able to resolve the conflict of evidence between Mr Spicer and Mr Murray. Mr Spicer alleged in his written evidence[109] that "it was quite clear at the conclusion of this meeting that the FCO was cognisant and supportive of Kabbah's intentions, and Sandline's role in supporting him, including the provision of weapons and equipment." He was sure that the supply of specific military equipment was mentioned; that means of short-circuiting the restrictions on exports of dual-use equipment were discussed; that no warning was given that Sandline's enterprise was illegal;[110] that "what President Kabbah was contemplating with our assistance was not going to be objected to"[111]; and that a principal concern of the FCO was that the campaign should not be long drawn-out or bloody so causing organisations such as Amnesty International to cause questions to be raised in Parliament.[112] Mr Murray told us that Mr Spicer had referred to a prospective contract with President Kabbah, while one had already been signed; that he had not referred to the possibility of his exporting illegal military equipment but only non-lethal material;[113] that he had misrepresented aspects of his conversation with the two officials (for example, about the supply of night vision equipment which they claim he said was for a mining company in Guinea); that there were matters which were "simple fabrication" (for example, any reference to a helicopter gun), and that Mr Spicer was "warned....strongly" and could have been in no doubt that the supply of arms was illegal. Mr Murray told us that he found it "difficult to reconcile [Mr Spicer's] version of events with the truth at all." In effect, Mr Murray told us that Mr Spicer had lied.[114]

33. Mr Spicer told us that his version of the 19 January meeting should be believed because there was no record in the minute of the meeting to any warning being given to him; that the UN Resolution, not the Order in Council, was referred to in the meeting; that he would not have subsequently met the High Commissioner or briefed him on the operation if he had known it to be illegal; and that he would hardly have contacted Mr Murray to ask him to intercede on his behalf with Customs and Excise (the prosecuting authority) once they had begun their investigation if Mr Murray's version of events was correct. He also attempts to expose a number of illogicalities, errors and inconsistencies in Mr Murray's account of events.[115] We note, too, that Mr Spicer rang Mr Andrews of the FCO on 10 March after a story implicating Sandline had appeared in The Observer two days before. The tenor of this conversation, as reported by Legg,[116] tends to support Mr Spicer's view that officials were aware of what he was doing. We also note that Mr Andrews at least was aware that a contract had been signed with Sandline as a result of a minute written by Mr Everard on 5 January.[117] That should have made him suspicious of the reference to a prospective contract on 19 January.

34. The principal difficulty in arriving at any definite conclusion about what transpired at the 19 January meeting arises because of the gross inadequacy of the official record. In our view, Sir John Kerr seriously understated the position when he described the written account of the meeting as "not a very satisfactory account."[118] The detail of the note of a meeting lasting about 40 minutes is contained in less than 200 words, and was only written after the meeting had ended. Mr Murray described the note as "accurate but not full," and explained why he had not required his junior colleague to write a fuller version.[119] However, the momentous consequences of the meeting for Mr Murray himself—his conclusions that Mr Spicer was "shifty" and "not trustworthy" and therefore someone to be blacklisted by Mr Murray's sections—warranted a much fuller note. We note that part of the guidance for future dealings with private military companies[120] requires a full record to be taken and to be shown to the company concerned so that they may have the opportunity to dissent if they wish.[121] For his part, Mr Spicer told us that in future he would seek written confirmation of his dealings with the FCO.[122]

35. In the absence of any record to the contrary, we cannot conclude with absolute certainty that Mr Spicer was clearly informed on 19 January that arms supplies to President Kabbah were illegal. Mr Spicer told us that there was "absolutely no question....at all" that he had deliberately attempted to implicate FCO officials in a course of action which he knew to be illegal so that he would have what could be described as "the Matrix-Churchill defence" if things turned nasty, and he specifically denied that he had tried to cloud or obscure the nature of his operation at the meeting on 19 January.[123] Nevertheless, we do not think that we can rule out the possibility that Mr Spicer was disingenuous in his dealings with Mr Murray and Mr Andrews and exploited a certain naiveté which they probably displayed.[124] After all, if he sensed any difficulty with them, he knew that his back was already covered by his dealings with Mr Penfold. Mr Murray certainly agreed with the Foreign Secretary's assessment that advantage had been taken of officials.[125] We do not, however, conclude that Mr Murray had any interest in positively facilitating Sandline's arms supplies—there is enough evidence from other sources that Mr Murray did not approve of the military solution which he was concerned that Mr Penfold appeared to be advocating.[126]

36. Although the Foreign Secretary accepted[127] his officials' account of the 19 January meeting, Legg concluded that "the only safe conclusion is that failure of communication was mutual."[128] However, we wonder whether there was some advantage to both sides in coming away without having exposed what was really happening in the case of Sandline, or having asked the really awkward questions in the case of Mr Murray and Mr Andrews. Mr Murray, for example, admitted that, though he had suspicions that Mr Spicer intended to supply arms, he did not ask him whether that was indeed his intention.[129] We are not convinced that Mr Spicer made it really clear to FCO officials that Sandline was going to supply arms.

Preventing the future use of the "Oral Licence Defence"

37. One small point in the drafting of the Order in Council helped Mr Spicer avoid criminal prosecution. It was a clear contention of Sandline's lawyers in their letter of 24 April to the Foreign Secretary that "it is quite apparent that the involvement of Sandline International in support of President Kabbah had at all times the approval of Her Majesty's Government and, should it become necessary, we would contend that a licence had been given within the meaning of the Sierra Leone (United National Sanctions) Order 1997."[130] Although a licence to export arms would normally be given in writing by the Department of Trade and Industry (and, of course, any arms supplier would be well aware of that), the Order simply refers to "a licence granted by the Secretary of State." Any Secretary of State could therefore in theory give a licence, and it could be contended by defence lawyers at a trial that any officer of any Secretary of State, as a High Commissioner clearly is, could give a licence—and could give a licence orally. Whether a jury would have been convinced by this defence will never be known. However, there is a simple remedy against this possible line of defence in future. We recommend that any future Order in Council dealing with arms embargoes should specify that any licence must be given in writing.

81 Q1018. Back

82 Unreported evidence. Back

83 Unpublished memorandum No.11. Back

84 Q1525. Back

85 Q724. Back

86 QQ782-788; 803; 805-7; 853-7; 912-928; 932-952; 1044-7. Back

87 Evidence, pp.151-152. E.g. of directors' names-see QQ938-40. Back

88 Q1778. Back

89 Q1833. Back

90 QQ797-801. Back

91 QQ775-781. Back

92 Q1022. Back