UK Drug Firms Told to Hand Over Files in Iraq Investigation

The Serious Fraud Office has ordered the British drug companies GlaxoSmithKline and AstraZeneca to hand over confidential emails and files relating to dealings in Iraq under the UN oil-for-food program.

The move is the latest in the SFO's £22m investigation into alleged corruption involving UK firms operating in Iraq during the final years of the Saddam Hussein regime. Other companies targeted with similar disclosure demands include several British infrastructure firms.

In a statement, GSK said it did not believe its "employees or its agents in Iraq knowingly engaged in wrongdoing regarding the oil-for-food program", adding: "In fact, GSK went to considerable lengths to cooperate with UK government authorities responsible for the UK administration of the program, and to impose anti-corruption measures when dealing with intermediaries in Iraq."

AstraZeneca confirmed that a disclosure request had been received and would be fully met. A third drugs firm, the US-based Eli Lilly, which has a UK arm, yesterday said that it too had been asked to supply documents to the SFO.

Last January, the Guardian revealed SFO officials had returned from Washington DC with thousands of documents marking the start of a London-based criminal investigation. This followed a 2005 independent report, commissioned by then UN secretary general, Kofi Annan, into the oil-for-food program.

As well as accusing UN officials presiding over the scheme of involvement in corruption, the report by Paul Volcker, a former chairman of the US Federal Reserve, listed more than 2,200 firms around the world that may have been implicated in bribery payments beneficial to the Iraqi regime.

The US Securities and Exchange Commission launched its own criminal investigation. But the SFO said that it was only monitoring the allegations and that its small specialist investigations unit was expected to play a supportive role in a US-led inquiry.

The decision to launch an independent criminal investigation out of London was made one month after the SFO controversially abandoned its investigation into alleged kickback payments on a contract between the British arms manufacturer BAE Systems and Saudi Arabia.

Shortly afterwards, the attorney general secured £22m of additional funding for the SFO, allowing it to pursue the oil-for-food allegations against British firms. The inquiry will be one of the SFO's largest projects. Ministers hope this will go some way to restoring Britain's reputation for tackling UK-based companies involved in overseas corruption.