The Rafael papers

 used to be on March 26th 2019 in New Delhi when officers from India’s Enforcement Directorate, a authorities agency tasked with hostilities economic crime and cash laundering, arrested Sushen Gupta, an influential intermediary in palms deals. After spending two months in preventive detention, he was charged with “money laundering” and launched on bail.

The charge associated to a vast corruption scandal which first erupted in 2013, dubbed “Choppergate”, which centred on a 550-million-euro contract for the sale to India of helicopters manufactured with the aid of the Italian-British firm AgustaWestland. While countless individuals mentioned in the case were subsequently cleared of wrongdoing by the Italian justice system, in India the investigations are continuing.

Gupta and different intermediaries were paid, the use of inflated invoices for what were termed as “software consultancy” contracts, greater than 50 million euros in commissions by AgustaWestland via offshore companies. According to the criminal criticism filed against Gupta, who denies wrongdoing, the Enforcement Directorate (ED) suspects that section of the money was once paid as bribes “to politicians, bureaucrats and government functionaries”.

In their investigations into the routes of the secret funds, the ED determined that Gupta also “received kickbacks” in order to have an effect on the result of “other defence deals”. The cash was discovered to have transited through the equal shell companies and the equal types of “software consultancy” contracts used in the helicopter deal.

2019 towards Sushen Gupta, the ED wrote that “since kickbacks from the other defence offers are not a challenge matter of the existing investigation” about the AgustaWestland scandal, “separate investigations would be undertaken” regarding the different deals.

Already in 2019, Indian investigative news internet site Cobrapost, and followed later through Indian daily The Economic Times, printed the contents of documents demonstrating hyperlinks between Dassault, Sushen Gupta and the sale of the Rafale fighter jets.

Yet two years later, there remained no visible proof that the ED had opened an investigation focused on the Rafale deal. Contacted with the aid of Mediapart, the agency did now not comment on whether or not such a probe had been launched.

Meanwhile, thanks to witness statements, the results of searches of premises and worldwide judicial assistance, the ED has gathered a mass of evidence regarding Sushen Gupta, including pc files, email correspondence, banking details, agendas and different handwritten documents.

Mediapart has obtained a variety of confidential archives from the ED’s case file, which shed new light on the behind-the-scenes occasions of the Rafale deal.

The first two reports in this three-part investigation have stirred public opinion in India over latest days, and Mediapart’s revelations here are probably to heighten the controversy.

According to documents acquired by Mediapart, Dassault and its French industrial accomplice Thales – a defence electronics firm in which Dassault and the French kingdom are the major shareholders – paid Sushen Gupta countless million euros in secret commissions to offshore accounts and shell companies, the use of inflated invoices for software consulting. These repayments were on pinnacle of a questionable contract with Dassault for making replica fashions of Rafale jets, worth 1 million euros, which was once revealed in the first of this collection of reports.

As middleman for Dassault and Thales, Sushen Gupta, amid the discussions over the Rafale deal in 2015, acquired confidential archives from India’s defence ministry relating to the things to do of the negotiating team. The Enforcement Directorate, in its official cost sheet against him, wrote that Gupta had received “sensitive data which ought to have only been in possession of the Ministry of Defence”.

It is now not clear how Sushen Gupta, who did not reply to Mediapart’s attempts to interview him, managed to reap the information. Three years earlier, in a note from his archives dated September seventh 2012, and which appeared to be addressed to Dassault, he warned: “Cannot end now too late for me, I owe people cash and commitments. […] People sitting in office asking for money. […] Those human beings will, if we don’t pay, put us in jail and […] then we are simply finished, deal scrapped.”

How France removed anti-corruption clauses in the contract

The proof found via the Indian investigators may assist to understand why Dassault and France-based European missile producer MBDA, which was additionally a party to the Rafale deal, labored hard to put off anti-corruption clauses in the inter-governmental agreement for the jets, which used to be negotiated and signed by Jean-Yves Le Drian, who was once then France’s defence minister during the presidency of François Hollande, and who is now overseas affairs minister under President Emmanuel Macron.

Those anti-corruption clauses should have had costly penalties for the industrialists, for they allow for India to rip up the contract and/or to demand compensation now not only if acts of corruption are discovered, however also if the vendor paid an agent in order to “intercede, facilitate or in any way to recommend [the seller] to the Government of India or any of its functionaries”.

India’s defence ministry was once required, under the phrases of the country’s “Defence procurement procedure” to include the clauses in query – “penalty for use of undue influence” and “agents/agency commission” – into the contract. But the French “Team Rafale” wanted them excluded.

In July 2015, in an annexe to the contract regarding the weaponry of the jets, supplied via MBDA, the French side wrote into the textual content that the two anti-corruption clauses were “Not Applicable”. But the Indians deleted this and reintroduced the anti-corruption clauses (see extracts from the archives immediately below).

Six months later, in the contract proposed on January thirteenth 2016 by the French team, regarding Dassault’s supply of the aircrafts, the two anti-corruption clauses had been again marked “Not Applicable” (see file below

According to a report in The Hindu, the Indian authorities subsequently approved the elimination of the clauses in September 2016, just earlier than the signing of the final contract, at a assembly presided by the Indian defence minister, Manohar Parrikar.

Did his French counterpart, Jean-Yves Le Drian, additionally approve the removal of the anti-corruption clauses? Was he knowledgeable of the move? “In no case do we validate the information that you refer to,” commented a spokesperson for Le Drian, now French overseas affairs minister, adding that, “the inter-governmental settlement […] concerned solely the requirements of the French authorities to ensure the shipping and quality” of the Rafale jets.

However, in the case of a sale agreed between two governments, the contracts are legally adjoined to the inter-governmental agreement. The heart of the negotiations was once led, on the French side, under the direct authority of then defence minister Jean-Yves Le Drian, through a team of eleven people, made up of eight senior members of the French weapons procurement and export enterprise (the DGA) and the French air force, along with two representatives of Dassault and one for the MBDA.

Questioned via Mediapart, the MBDA replied: “MBDA does not habitually remark on negotiations concerning contracts.” Also contacted, Dassault declined to comment, as it has additionally declined to respond to all the troubles raised in this report.

François Hollande, who was French president at the time of the activities (in office from May 2012-May 2017), informed Mediapart that he was “at no second informed of these components of the negotiation”, and that he therefore should “not have approved an eventual elimination of these [anti-corruption] clauses”.