BAE reported confirming Saudi "support services" deals

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LONDON (Reuters) - BAE Systems has confirmed that "support services" were paid for and provided to senior Saudi Arabian officials as part of a major arms deal, the Financial Times said on Thursday, citing an official account.

The company touched on the nature of payments at the heart of bribery allegations surrounding the Al Yamamah defence contract in a letter from its solicitors to the Serious Fraud Office (SFO) in November 2005, the newspaper reported.

But BAE told the SFO the allegations were unfounded, the FT said, noting that details of the letter were released late on Wednesday under freedom of information laws.

According to the account, BAE’s lawyers confirmed to investigators that payments had been made for the provision of "support services" to Saudi officials, although it did not say what these services were, the newspaper reported.

The letter added that the lawyers said the payments had been made as part of contractual arrangements, the FT said.

A comment was not immediately available from BAE.

The SFO dropped a corruption inquiry last December into the multibillion dollar Saudi deal with BAE Systems.

Prime Minister Tony Blair said pursuing the case would have harmed national security and relations with Saudi Arabia, which he called crucial for counter-terrorism and Middle East peace.

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