These firms, said Hopkins, acted as ‘cut outs’ to distance BAT and were used ‘to pay bribes, move cash across African borders, protect smugglers of BAT cigarettes and conduct black ops on rivals'.

Now, former insiders working with BAT in South Africa have approached the SFO with detailed affidavits and documents, which help corroborate Hopkins and cast further doubt on the company’s insistence that London is not implicated in the unfolding scandal.

The new whistleblowers – a security adviser and a lawyer – describe how through a system of covert cash payments BAT’s intelligence unit in London financed a network of African spies, including local police officers, to disrupt commercial rivals.

The picture emerging is one of a tobacco company with a revolving door to senior British military intelligence figures encouraged to nurture close, perhaps too close, relationships with local law enforcement agencies.

BAT claim its relationship with African police, customs and intelligence officers is part of a global effort to combat illicit activity, including smuggling of genuine and counterfeit cigarettes.
However, the evidence emerging from whistleblowers inside BAT’s anti-illicit trading department suggests the relationship with local law enforcement has been corrupted. Hopkins and the South African whistleblowers say BAT is using the relationship as a ‘cover’ for black ops against competitors and to ensure only its smuggled cigarettes reach black markets.
 
The 'Devil’s Fixer'
 
Until very recently, Hopkins, a former Irish Army special forces operative, was holed up in his gated villa in Nairobi, where he spoke to Spinwatch about his life as an economic hit man.
In a role reminiscent of the character Winston Wolf from the film Pulp Fiction, 52-year-old Hopkins, who describes himself as ‘the Devil’s Fixer’, said he also cleaned up sex and drug scandals involving randy senior BAT executives visiting Africa.

After spilling the beans to the SFO and Kenya’s ethics and anti-corruption commission (EACC), Hopkins feared being killed or fitted up by those he is exposing. He therefore seldom ventured outside his compound and had taken to sleeping with enough weapons to kit out a mercenary army.

Michael Mubea, EACC deputy chief executive said his joint investigation with the SFO is looking at allegations of ‘bribery and tax evasion’ by BAT but declined to confirm whether Hopkins had been given protected witness status.

The Irishman is seeking immunity from prosecution in return for giving evidence against BAT in the UK or US, where congressman have called for the Department of Justice (DoJ) to also launch a corruption probe. Whistleblowers in the US receive a percentage of any fine imposed following a successful prosecution under the Foreign Corrupt Practices Act.

The SFO is understood to be focusing on alleged breaches of the UK Bribery Act, which allows for British companies to be prosecuted here for corruption overseas. However, the DoJ has in the past proved itself more determined and less prone to political interference than the SFO, whose strike rate when it comes to putting big business in the dock and securing convictions is a poor one. 

The SFO has yet to launch a formal investigation and said it is still in the ‘intelligence gathering’ phase. Its investigators working with the National Crime Agency have been interviewing Hopkins since last December and recently took control of his large cache of internal BAT documents.

They are believed to be focusing on a series of alleged bribes for inside information, including to leading Ugandan and Kenyan politicians, one of whom is said to have taken money and a car to launch a tax evasion probe into a BAT rival.

Hopkins has explained how at the behest of BAT’s East Africa corporate and regulatory affairs (CORA) department, between April and July 2012 he arranged the bribery of officials in Rwanda, Burundi and the Comoros Islands to water down implementation of the World Health Organisation’s 2005 Framework Convention on Tobacco Control (FCTC).

Internal documents show that Hopkins used a Nairobi-based company as a conduit for making six cash payments totalling £20,000 to the government officials.

One of the men who delivered the cash and asked to remain anonymous told Spinwatch that at all times he was acting on BAT’s instructions. ‘My conscience is very clear. Even if I went to court what wrong did I do? It was a company that instructed and there is very clear documentation,’ he said.

The FCTC seeks to control the £500 billion tobacco industry but BAT, who produced 663 billion cigarettes last year, has called the legally binding global agreement an ‘unprecedented challenge’ to growth in core markets such as Africa, where it is the dominant force.
Details of its attempt to covertly undermine the treaty through paying bribes to those charged with implementing it only emerged when Hopkins brought a claim for unfair dismissal against BAT in January 2015.

The tobacco giant admitted in its legal response to the claim that the six CORA payments were ‘unlawful bribes’ but continues to maintain it was an isolated instruction from Julie Odellowino, a Kenyan manager and lawyer, who subsequently left the company.

Odellowino, however, appears unwilling to carry the can. ‘I have nothing to hide and I have a clear conscience … A better picture of the truth if not the whole picture’ will emerge from BAT’s internal inquiry, she said in response to a written request for an interview.

Chief executive, Nicandro Durante, who was responsible for Africa from 2006-7, has asked external lawyers Linklaters to investigate the allegations about BAT’s African operation.

The top law firm is the third after Kaplan & Stratton and Herbert Smith Freehills to examine the bribery allegations since Hopkins first raised them internally in July 2012. None of the previous reports have been made public.

Durante, who recently angered investors over his attempt to increase his annual pay packet by 20% to £10 million, said Linklaters had an ‘open door’ to BAT’s files. 

However, critics suspect that the tobacco giant, who the SFO said has supplied documents to its inquiry, is planning to make controlled admissions to head off any raid on Globe house and draw a line in the sand.

The scandal is also an embarrassment to Ken Clarke, the Tory grandee who from 1998 to 2007 was the deputy chairman of BAT and responsible for oversight of its ethical corporate conduct. Hopkins body-guarded Clarke during a visit to BAT’s east African headquarters in Nairobi, Kenya.
 
‘Have you told anyone about our payments?’
 
BAT has confirmed that Linklaters will also look into the new allegations that have emerged involving its Southern African operation.

So too are the SFO. The UK agency widened its probe after receiving affidavits from Carnilinx, a rival tobacco manufacturer based in Johannesburg.

Carnilinx is suing BAT for anti-competitive practice and is relying on two key witnesses.

The first, Daniel van der Westhuizen, worked for Forensic Security Services (FSS), a South African firm who BAT confirms it retained.

According to his December 2015 signed affidavit, FSS ran 171 paid informants and a trusted group of ‘corrupt’ law enforcement officers to, among other things, fit up and ‘eliminate’ Carnilinx through ‘a systematic campaign of harassment and disruption’.

Westhuizen, a former South African police officer, said he was asked to devise an operation, codenamed Knysna, to disrupt Carnilinx. He named three London-based BAT intelligence managers - Ewan Duncan, Colin Denyer and Allan Evans - who he said oversaw the operation in 2014.

Westhuizen attached to his 70-page affidavit a list of spies and examples of individual ‘special consultancy fee’ receipts with the signatures of Duncan and Evans purportedly signing off the monthly cash payments.

In a second development, Carnilinx said that Belinda Walter, a South African lawyer, has admitted to being a paid informant for the state security agency and BAT while acting as their legal representative.

Walter, 41, named her handlers as Duncan, Denyer and Evans, three former senior British military intelligence officers, in an unsigned affidavit provided by Carnilinx to Spinwatch.

In the long document, Walter describes how she passed on legally privileged information to the three BAT spymasters during clandestine meetings in London and Johannesburg in 2013 for which she was paid £36,000 using a Travelex card that BAT loaded every month with cash.

Attached to Walter’s affidavit are copies of the card and the transcript of a January 2014 call purportedly with Evans in which he advises her how to handle an inquiry by local tax investigators into these and other informant payments. ‘Have you told anyone about our payments to you, intimated that eventually we started paying you for, you know, information?’, he is recorded asking.

Two months later Duncan wrote to Walter. She was threatening to go to the media about her work for BAT. In his letter, Duncan defended BAT’s work as lawful and said it had been ‘guided’ by the company’s legal department.

Duncan and Denyer no longer work for BAT and declined to comment. Evans referred inquiries to BAT’s press office.  A spokesperson said: ‘A full investigation is being conducted with the assistance of an external law firm. If we were to find that illegal activity had occurred, we would, of course, take appropriate action.’

However, Carnilinx, who said it had recently met with Linklaters, dismissed BAT’s inquiry as a ‘whitewash’. SFO investigators, it said, will shortly be taking witness statements from Carnilinx directors. The SFO declined to comment.

A victory for public health

BAT received another blow on March 24 when the Kenyan high court rejected its legal challenge to block implementation of the 2014 FCTC regulations.

It is not clear if the scandal over BAT’s attempt to corruptly undermine implementation of the public health treaty and corruption allegations against several senior Kenyan politicians had any impact on the high court’s decision making.

However, anti-tobacco campaigners see the ruling as an important victory in the eleven-year struggle to implement the FCTC treaty against powerful corporate interests in Africa.

‘The court’s decision is a resounding victory for public health and … sends a strong message that tobacco industry interference in laws to improve [it] will not be tolerated,’ said US-based Campaign for Tobacco Free Kids.

The statement added: ‘[The ruling] allows the Kenyan government to move forward with implementing a law that will protect millions of citizens from the devastating consequences of tobacco use … Among other measures, Kenya’s new regulations will require picture based health warnings, strengthen protection against second-hand smoke and require tobacco companies to pay an annual fee into a designated tobacco control fund.’

BAT is appealing the decision and said it would defend the claim brought by Carnilinx.

Copyright: Michael Gillard