Prince Al-Waleed is one of Saudi Arabia’s richest princes and profited enormously from Saudi arms purchases. Andrew Feinstein, the author of ‘Shadow Wars,’ on the legal risks of corrupt arms dealing

Story Transcript

SHARMINI PERIES: It’s The Real News Network. I’m Sharmini Peries coming to you from Baltimore. Prince Alwaleed bin Talal is the most famous among the hundred of senior Saudi Arabian officials arrested in the purge ordered by the Crown Prince, Mohammed bin Salman. The arrested officials are being held at the Ritz Carlton Hotel in Riyadh. The apparent corruption investigation and crackdown and mass arrests that are taking place, are they really genuine efforts to clean up the state or is it a power struggle among the differences within the kingdom’s royalty itself on how they should operate in the Gulf and the region? Whatever it is, it is shaking the pillars of Saudi Arabia and the government in charge, including the royalty itself, causing a great deal of uncertainty as to the direction of the wealthy kingdom’s role in the region, particularly in relation to its regional rival, Iran. Meanwhile, the Wall Street Journal reports that assets of the detained princes and officials, worth an estimated $800 billion, may be confiscated by the state. On to discuss these developments is Andrew Feinstein. He is the author of The Shadow World, which is a comprehensive study of the world of arms dealers and the large weapon companies. His movie, based on the book, is released in 2016 and will be aired soon. Andrew, good to have you with us. ANDREW FEINSTEIN: Thank you very much. I’m delighted to tell you that the film will actually be screened on ITVS in the U.S. on the 20th of November. SHARMINI PERIES: Andrew, Prince Talal is very famous for his large investments in western companies, such as Citigroup, Twitter, 21st Century Fox and others. While news of his arrest got around in the stock markets, I understand his wealth had declined by three-quarters of a billion dollars. What do you know about his dealings and, particularly, his role in the arms industry? ANDREW FEINSTEIN: He’s certainly one of the richer Saudi of the princes, even if not the richest. He has a golden throne on his private jet, so really a man of the people, this one. He has, as you mentioned, investments in a wide array of corporations, including some defense companies. He recently, as far as I can establish, actually exited his investment in 21st Century Fox. I’m not sure whether that was a consequence of his arrest or not, but he is certainly one of the key Saudi movers and shakers in the world of high finance. That, of course, includes being invested in the defense sector. He very much reflects the sort of standard modus operandi of members of the Saudi royal family, in that they do massive transactions often through the Saudi state, so they will either operate in their individual capacity or through the Saudi state. A big function of the large arms deals that are undertaken through the Saudi state, and particularly arms deals, being an industry that accounts for about 40 percent of all corruption in global trade, an industry that takes place behind a national security enclosed veil of secrecy. It’s the perfect vehicle and tool with which to move money from the national treasury in Saudi Arabia into personal offshore accounts, and has been used for this purpose since the Saudis have become really serious players in the global arms trade, which is since the 1950s. The prince is no exception when it comes to that. I think the only thing that probably differentiates him to some extent is the scale of the amounts of money being, as I mentioned, one of the richest of the Saudi royal family. But I think most crucial of all is that when we look for reasons for his arrest, we’re not really looking, as stated, at some sort of corruption crackdown, because then the entire Saudi royal family would have to be jailed, including the Crown Prince, who is supposedly heading up this crackdown. Rather, this is a power play, a political power play reflecting on dynamics within the Saudi royal family, and it happens whenever there is a changing of the guard in Saudi Arabia. This is the Crown Prince trying to consolidate his power base, trying to get rid of potential rivals. I should say that those rivals are both political and economic rivals, because how the Saudi royal family operates is that, in order to achieve power, to get into the position of being Crown Prince, where you become the anointed successor, if you will, requires an enormous amount of money. This is effectively, to be able to have the resources to disperse to other members of the Saudi royal family in order to consolidate your position and power. Obviously, somebody like Prince Talal, who has significant financial holdings around the world, who has significant economic power behind him, is in a position to dispense patronage. The current Crown Prince had to neutralize that, and that’s what these latest arrests are about. I see absolutely no evidence of any meaningful structural reforms in Saudi Arabia that could lead to less corruption. The Saudi state was founded on corruption, it’s modus operandi has corruption as an absolutely central element to the functioning of the state and the royal family, and I see no change here. This is just another power play by another young Saudi royal to try and ensure that he is the next king. SHARMINI PERIES: Andrew, I guess this begs the question, why does Saudi Arabia actually need so much weapons? In recent years, it is rated among the top weapons importers in the world, although its military isn’t very large. Are there even enough Saudi troops to wield all these weapons? ANDREW FEINSTEIN: Absolutely. I think you make a very important point. I think the first thing to observe is that, over the last few years, we have seen a far more aggressive military stance from Saudi Arabia in the region. That is manifest a few years ago, for instance, in its role in Bahrain, where the Saudis effectively saved the Bahrainian royal family and, for periods of time, had huge numbers of troops in Bahrain putting down democracy protests. This was Saudi Arabia flexing its military muscles to actually save an equally corrupt, equally autocratic ally. Then I think we have obviously seen Saudi’s role in Syria and, most devastatingly, Saudi’s role in Yemen. Let me deal with those individually. In the case of Syria, we have seen Saudi Arabia allied with various militias and organizations in Syria, some of whom have Al Qaeda connections which, again, is following through on suspected links between Saudi Arabia and Islamist extremist movements, which I believe has been going on for years and years and years and is reflected by the fact that in, perhaps the most corrupt commercial transaction in history, the so-called Al-Yamamah deal between the U.K. and Saudi Arabia, in which Prince Bandar bin Sultan, who was then the Saudi ambassador to the United States and son of the then defense minister, was paid over a billion pounds in bribes, into his bank accounts in Riggs Banks in Washington, D.C. Some of this money inadvertently, in his words, found its way from his accounts into the accounts of his wife in the same bank and into the accounts of the 9/11 hijackers. The fact that Saudi Arabia therefore seems to be supporting financially, militarily, in terms of weapons, some Al Qaeda-linked entities in Syria, should hardly come as a surprise to us. Where it is something of a surprise is that Saudi Arabia remains this firm ally of the west, despite its links to these sorts of groupings. It’s really in Yemen that we are seeing the tragic manifestation of the Saudi policy of belligerence and aggression in the region. You could argue that the primary reason for this is a proxy war with Iran because, quite clearly, Saudi Arabia, interestingly in something of an unspoken alliance with Israel, wants to be the top dog in the Middle East region. Its only real threat to that position is Iran, so we’re seeing in Yemen since March of 2015, that a Saudi-led coalition that very prominently includes the Emirates, has effectively been committing violations of international humanitarian law and, I would argue, war crimes, on the Yemeni population. This has been through massive bombings. I need to explain here that it’s not massive bombings that, as a consequence of collateral damage, has killed thousands and thousands of Yemeni civilians, but it’s actual bombing that has consciously targeted civilian targets, places of worship, places of residence, schools, hospitals, economic infrastructure, including agricultural land, that has resulted, according to the latest U.N. reports, in almost 14,000 civilian casualties. These have been enabled by billions and billions of dollars of weapon sales to Saudi Arabia by, particularly, the United States and the United Kingdom, over this period since March of 2015. The U.S. and the U.K, in my opinion, are complicit in these violations of international humanitarian law and war crimes that are being committed by the Saudis in Yemen. Add to that the blockade of the country that is being led by the Saudis. This is an air blockade, a sea blockade and a land blockade that has prevented desperately needed food and even more desperately needed aid getting into Yemen, that has created perhaps the greatest humanitarian crisis of this century. A crisis that has seen literally millions of the Yemenis infected with cholera, it’s estimated that a Yemeni child is infected with cholera every 35 seconds as we speak. This is the actions of a completely uncivilized, belligerent power that is flexing its muscles, regardless of the human consequences. I believe that the Yemeni war that is being perpetrated primarily by the Saudis and their allies, with the assistance of western countries who have provided them not just weapons but also with diplomatic protection, tells us what the new Crown Prince in Saudi Arabia is really all about. SHARMINI PERIES: On Saturday, Andrew, a missile fired from Yemen reached Saudi’s city of Riyadh. The Saudi military claims that they have intercepted the missile and blamed Iran for supplying the Houthi rebels with the missiles. ANDREW FEINSTEIN: Yep. SHARMINI PERIES: From the perspective of the global arms market, how would Iran be able to obtain and deliver a long-range missile to the Houthis, and how would the Saudi military be equipped to intercept such a missile? In other words, who’s profiting from the Saudi military bombardment of Yemen and the casualties and the humanitarian crisis that you describe? ANDREW FEINSTEIN: The people who are benefiting financially are the United States of America, the United Kingdom and, to some extent, Russia and assorted arms dealers, intermediaries in these transactions. For the Saudis to announce that there has been a launch of this missile on Riyadh that they intercepted, it’s quite possible that they would have the equipment from the United States to intercept these missiles, depending on what missile it was. To say that this was supplied by Iran to the Houthis is taking a step further that we can’t be sure about at this point. It is as likely that the Houthis acquired this weaponry, these missiles, if indeed they were fired, acquired them through intermediaries. I am aware of quite literally dozens of arms dealers in the region who would very happily sell the Houthis and pretty much anybody else whatever they wanted and needed if they had the money to pay for them. I’m not prepared to say that the Saudi reports of this incident are indeed accurate, but what I can tell you with a degree of accuracy is that the U.S., the U.K., without a doubt, were benefiting financially. Members of the Saudi royal family, as I mentioned, would benefit because they benefit from all arms transactions with the kingdom by this movement of monies from the national treasury into offshore secret accounts that they hold, containing billions of dollars individually all over the world. Other beneficiaries could have been Russia, who have been known to supply the Iranians, who have been known to supply the Houthis but most likely to be the various arms dealers in the region who have been supplying, in some instances, both sides in this tragic conflict and the humanitarian disaster that’s unfolding. SHARMINI PERIES: Andrew Feinstein, author of The Shadow World, both the book and film, I thank you so much for joining us today. I hope you pleasure us with your analysis again in the future because I know you are limited in terms of time today. ANDREW FEINSTEIN: Absolutely, I’d be more than delighted to. Thank you so much. SHARMINI PERIES: And thank you for joining us here on The Real News Network.