162. Telegram From the Embassy in Saudi Arabia to the Department of State1
6332. Subject: Sultan’s Further Views on Lockheed Bribes. Ref: A) 218708; B) State 218793; C) Jidda 6333.
1. Yesterday morning, immediately on receiving ref A, I told Prince Saud that the names had not been given to the Congress. He replied that we should be thankful for small blessings and he trusted that the administration would ensure that the names are never given to Congress. He said that Prince Sultan would still want to see me the following day.
2. I saw the Prince at one o’clock this afternoon (10 GMT Sept 14). By that time, I had received ref B. Unfortunately, Saud had already told him the names were not in the hands of Congress and when I told him they were, he reacted icily. I told him we had the word of Senator Church that the names would not be released to the press. He asked if anyone in the United States Government were naive enough to accept Senator Church’s word as binding.
3. I told Sultan that there was indeed a real danger that the names would be leaked. I also said that if they were, it would be extraordinarily important for the Saudis not to overreact. There were quite clearly individuals in the United States and elsewhere who would like to exploit this incident to disrupt relations between the two countries—permanently, if possible. But Saudi Arabia must not rpt not fall into [Page 546] their trap. If they do, only the enemies of the two countries would benefit.
4. Prince Sultan listened attentively but made no commitment. He said he had a few questions he would like to ask:
A. How is it possible for the State Department to inform him one day that the names had not been given to the Congress and inform him the next day that they had been? Is this not something the State Department has a right to know? Can it not demand this information either from the company or from the Congress?
B. Did the State Department make any effort to prohibit the company from giving the names to the Congress? He assumed not and if not, then why not?
C. Why is the State Department not able to get copies of the documents from Lockheed before they are released to the press? Prince Saud will ask for these documents when he is in the States, and he trusts they will be available to him at that time. Perhaps, the Prince said, the Saudis should go to Lockheed directly. If Lockheed wishes to have any future in the country it will surely give them the documents.
D. Does the United States recognize the consequences of the release of such things to the press? Has it been made clear to the State Department the strength of the feelings of Saudi Government on this matter? (The other questions may have been only rhetorical and I did not answer. I told him I could answer this one, however: the feelings of the Saudi Government, as expressed by Princes Sultan and Saud, had been reported fully.)
E. Is this part of the new “hard line” toward Saudi Arabia? Is the United States Government trying to humiliate the Saudi Government? If so, the reaction in Saudi Arabia and elsewhere would be highly negative. (I told him I was sure it was not: The administration itself would be highly embarrassed if the names are leaked to the press.)
5. Prince Sultan said that he had just talked with Adnan Khashoggi and had asked him if he had at any time ever mentioned to any company representative the names [less than 1 line not declassified]. Khashoggi replied that he would swear on the holy Koran that he had not. He had, however, arranged for the company to pay $2 million to former Air Force General Hashem and $5 million to [name not declassified].
6. Prince Sultan said he wanted a commitment from Adnan Khashoggi that within the next three days he would break all relations with the three companies, foregoing all commissions. Prince Sultan said that he expected to have evidence within the next day from Khashoggi that he had done this.
7. Comment: The agents’ commission problem seems to have been solved if ref C and paragraph 5 of this cable are actually put into effect. [Page 547] I urgently request that this information not rpt not be passed to any of the companies involved; it will be public knowledge soon enough. Sultan said he wanted both actions (Khashoggi relinquishing his agencies and the new Saudi decree) taken before the names of the persons allegedly bribed by Khashoggi hit the press. It is important, he said, that their actions—which they have considered for a long time—not appear to the public as reactions to the Senate disclosures. I told him we would continue to try to keep the names confidential but could guarantee nothing.
7. The Saudis will probably react against us for what they consider our failure to protect them from embarrassment and to what they still consider our “new hard line” toward them. Sultan seemed impressed with my argument that they should do nothing to harm our long-term relationship and I hope their reaction will be only to refuse to do some of the less important things we are constantly asking them to do, e.g. help third countries; grant overflights; support our positions in the UN. And our companies probably will lose the next few big construction projects. If the Saudis limit themselves to this, we’ll have escaped neatly for I cannot overemphasize their current anger.
Summary: Akins met with Sultan, who informed him that he had demanded Khashoggi relinquish his claims to U.S. military contractors, including Lockheed and Northrop.
Source: Ford Library, National Security Adviser, Presidential Country Files for the Middle East and South Asia, Box 30, Saudi Arabia—State Department Telegrams, To SecState-Nodis (8), 9/75–11/75. Secret; Immediate; Nodis. In telegram 218793 to Jidda, September 14, and referring to its previous telegram 218708 (see footnote 1, Document 161), the Department informed the Embassy that the Church Subcommittee had received documents revealing the names of “foreign government officials” paid by Triad or Lockheed. Church promised that these names would not be revealed. (National Archives, RG 59, Central Foreign Policy File, D750318–0697) Telegram 6333 from Jidda, September 14, is ibid., D750318–0826. On September 15, the Saudi Council of Ministers released Decree 1275, forbidding, ex post facto, any agent fee. (Ibid., RG 84, Jidda Embassy Files: Lot 79F80, DEF 12–5 Agent Fees) The Embassy received a further letter from the Saudi Ministry of Foreign Affairs, formally notifying the United States of the new policy, on December 3. (Ibid.) On February 18, 1976, Prince Abdullah confirmed for Horan that the ban on agents’ fees would apply to all programs, including the SANG modernization, reported in telegram 1218 from Jidda, February 22. (Ibid.) On September 20, 1976, Deputy Minister of Foreign Affairs Mansouri notified Horan that it would also apply to service contracts, reported in telegram 6341 from Jidda of the same date. (Ibid.)
↩