Financial Times FT.com

Barter fund used to pay commissions to middlemen

By Stephen Fidler and Michael Peel

Published: June 8 2007 03:00 | Last updated: June 8 2007 03:00

An opaque series of contracts dating back to 1985 lies at the heart of the controversy about payments made by BAE Systems in connection with Britain's biggest ever defence deal.

The contracts covered the purchase and maintenance of Tornado warplanes, Hawk training aircraft and other defence equipment worth £43bn under a deal named Al-Yamamah, Arabic for dove.

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