Senior MoD jailed for taking bribes from US arms dealer
Last updated at 17:16pm on 16th April 2007A senior Ministry of Defence official who built a luxury villa in the sun with bribes for helping an American company win a lucrative contract has been jailed for two years.
Greedy Michael Hale's lengthy betrayal of trust saw the American company being fed so much confidential information that it was able to run circles around the competition.
In addition to backhanders of more than £217,000, the 58-year-old civil servant's five-star lifestyle featured free flights, champagne hospitality aboard an ocean-going cruiser and stays in top hotels, London's Southwark Crown Court heard.
But when his secret paymaster was taken over by another firm, "due diligence" attorneys in California uncovered a total of nine corrupt payments paid to him over the years.
The US authorities promptly informed the MoD.
During the ensuing investigation both his wife and stepson were arrested and wrongly accused of money-laundering. They were subsequently cleared of any wrongdoing.
Hale, of Crown Mews, Ramsey, Cambridgeshire, pleaded guilty to nine counts of accepting bribes from Pacific Consolidated Industries between November 1999 and July 2003.
He showed no reaction as Judge Christopher Elwen told him jail was inevitable for his life of crime.
He said the £4.5 million contract Hale was in charge of as a team leader and a senior professional technology officer was for the supply of gas and containment equipment for all three services, particularly the RAF.
He said: "The first set of payments, all of which were actually made in US dollars, was made to you using your stepson's bank account.
"The second set of payments were paid from an American account to one in Spain in relation to the purchase and building of a five-bedroom villa with swimming pool in Benidorm.
"You were well aware of the strict rules about behaviour to be avoided so as not to raise the presumption of corruption.
"In that context you got to know Pacific Consolidated Industries (PCI) in Santa Ana, California, initially on a legitimate basis.
"But the relationship with that company and in particular with one of the company's vice-presidents, one Lee Smith, became corrupt."
The judge said that if the normal tendering process had been followed, interested companies would have received only the "general specifications" of what was needed in order to "trigger and provoke innovation of solutions".
"But as a result of your intervention, that tender process became, on occasions, entirely corrupted.
"In other words, the playing field sloped considerably in favour of PCI and against everybody else who chose to enter into the competition."
He continued: "It is suggested on your behalf that nothing you did resulted in the MoD being supplied with sub-standard equipment.
"There is, however, no doubt that offences of this nature, which to put it bluntly are the taking of bribes by public servants involving breach of trust and breach of confidence, can be visited by an immediate custodial sentence.
"And sentences for public servants acting corruptly contain an element of deterrence as well as punishment."
Christopher Donnellan, prosecuting, said the investigation by MoD police revealed the full extent of Hale's life of luxury.
Apart from his five-bedroom Spanish villa, he bought another house near his home and enjoyed "lavish hospitality" from his alleged American partner-in-crime, who is still awaiting trial.
"He was taken out for meetings and dealings on Lee Smith's boat and air fares and hotel bills paid for him," said counsel.
A confiscation hearing will be held later this year.
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