BAE chief subpoenaed in U.S. over Saudi arms deal

By Jim Wolf

WASHINGTON (Reuters) - U.S. officials investigating alleged bribes in a Saudi arms deal subpoenaed the chief executive of BAE Systems (BAES.L: Quote, Profile, Research, Stock Buzz), Britain's biggest military contractor, on his arrival in the United States last week, BAE officials said on Sunday.

A subpoena was served on Mike Turner, the CEO, at George Bush International Airport in Houston, Texas, on May 12, said Greg Caires, a BAE spokesman in Washington.

Also subpoenaed was a BAE non-executive director, Sir Nigel Rudd, who was traveling with Turner, Caires said.

A subpoena is a court order to give testimony. The summonses were part of a U.S. Justice Department investigation of bribery charges tied to Britain's biggest arms deal, a series of warplane sales to Saudi Arabia clinched in the mid-1980s and valued at up to $80 billion.

The British government's Serious Fraud Office dropped an inquiry into the deal in December 2006 after then-Prime Minister Tony Blair said the probe threatened national security.

In June 2007, the company said it had been notified the U.S. Justice Department had begun investigating BAE's compliance with anti-bribery laws, including dealings with Saudi Arabia.

An unspecified number of subpoenas also were served on BAE Systems' employees in the United States last week, BAE said.

"The company has been and continues to be in discussion with the DoJ (U.S. Department of Justice) concerning the subpoenas served in the course of its investigation," Caires said.