A second submission to Sir Gordon Downey
from The Guardian
This document is in response to a 133-page
submission from Neil Hamilton, together with a later submission
dealing with commission payments.[20]
PREFACE
We believe this response shows conclusively that
Mr Hamilton has lied to:
The Parliamentary Commissioner for Standards In
the document presently under consideration he now even lies about
his lies to the above named people.
We note the seven principles of conduct which
the Nolan Committee considered underpinned public life. They
are: selflessness, integrity, objectivity, accountability, openness,
honesty and leadership. They are stated in full on page 14 of
Volume 1 of Lord Nolan's first report.
We believe that Mr Hamilton's behaviour contravenes
all these principles. We believe Mr Hamilton's lies to the Inquiry
place him in Contempt of Parliament. Above all, we believe that
a man who so casually and habitually lies is unfit to hold public
office.
(1) The libel action: a fundamental question of
justice
Mr Hamilton's latest document reads as the script
for the courtroom battle he walked away from. It consists of
notes towards the cross-examination of Mohamed Al-Fayed. Since
Mr Hamilton evidently believes that this 133-page text is the
definitive demolition of both Mr Fayed and the case against him
one cannot help wondering afresh why it is that he was unwilling
to present this case in court.
What is most noticeable about this 133-page
document is his total failure to grasp this nettle: he makes no
reference to his withdrawal from the libel action, let alone
offer any credible explanation for it.
If his story is true, he stood to make a
six-figure sum in damages. Why, then, did he not persist with
his action? The inescapable inference is that he knew full well
that truth would out, and dared not take the risk.
It is a norm of our society that public figures
must sue for libel to remove a published imputation of dishonour,
and it is a corollary of that rule that those who do not sue
and (especially) those who back down at the door of the court,
must be assumed guilty of the dishonourable imputation that they
have declined to refute. Hamilton's whole case is an invitation
to your inquiry to undermine this salutary norm. We believe that
it is wrong for him to be able to do so - seeking to blacken
the name of The Guardian under privilege
- without first offering to you a documented explanation for
his withdrawal from the libel action.
What could plausibly explain his reluctance
to fight an action he had so publicly launched and on which so
much hung?
Was it honestly because of a legal
technicality, which only became apparent in the final days of
the case? This has always seemed improbable.
- The solicitors, Peter Carter Ruck,
are the most experienced firm in the country in handling large
and complex libel cases. Is it really likely that they would
have failed to anticipate the possible clash of interests between
their two clients? If they did fail to anticipate such
a clash that would surely be a matter so serious that Mr Hamilton
would wish to recover his £150,000 through an action for
professional negligence. Is he doing so?
- Mr Hamilton is himself a barrister,
with personal experience of fighting a massive libel case. Is
it credible that he could have invested two years of work and
£150,000 of his own money without considering in advance
the possibility that he and Greer might be better advised to have
separate legal representation?
Because he ran out of money?
Unlikely.
- His last libel case was funded by Sir
James Goldsmith - though Hamilton dissembled about this in a
letter to The Times on 29 October, 1985 (Sleaze 58). His
solicitors, Peter Carter Ruck, themselves lied about this to
The Guardian, maintaining that Sir James had no involvement
in the action during the course of The Guardian case.
Unfortunately, the truth was revealed in Peter Carter Ruck's
own memoirs.
- Hamilton, as a barrister who had previously
fought a massive libel action, cannot plausibly claim to have
been innocent about the huge costs involved in such litigation.
As we have remarked before, there is something
Hamilton and Greer (and their legal team) know about that final
week before throwing in the towel and it is unlikely that the
present Inquiry will get at the truth of the whole affair without
questioning counsel and solicitors in the case.
We have frankly presented our lawyers before
the Inquiry and invited you to question them about any aspect
of the case. Indeed, we have written extensively about our own
legal preparations for the trial in Sleaze. Is Mr Hamilton willing
to extend you the same opportunity?
The other matter that
strikes us about the libel action occurs in the document from
Mr Hamilton's co-plaintiff and collaborator, Ian Greer. He has
now ventured an explanation to you for his decision to
withdrawn. At paragraph 2 of his letter he says that he was
concerned about the impact of the new statements, and especially
that Bozak might be taken seriously by the court.
What strikes us about this explanation is that
we can prove that Mr Greer did not receive these statements until
9.10 pm on Sunday 29 September, when his solicitors asked our
lawyers to fax them urgently. The offer to withdraw the action
(if only The Guardian would not insist on its costs) was
made on Friday 27 September at 5.40 pm. The plaintiff's lawyers
had by this time seen their respective professional bodies earlier
that day. So here we have a clumsy attempt by Mr Greer, whom
we understand to be working closely with Mr Hamilton in respect
to your inquiry, to pull the wool over your eyes in respect of
this crucial preliminary issue.
(2) Cash and the doctrine of "Plausible
Deniability"
Mr Hamilton says that he is being asked
to prove a negative. That, he points out, is an inherently difficult
thing to do.
The Guardian, too, had an inherently difficult
thing to do. Any MP accepting money on the scale that Tim Smith
and Neil Hamilton did is bound to anticipate the possibility of
the matter coming to light or being used against them. Neither
man is stupid. Both have, to varying degree, displayed a capacity
for dishonesty. It follows that they would take care to ensure
that there would be as little proof as possible that these monetary
transactions had taken place.
Mr Smith has, at least (after initial lies
to The Guardian) now admitted that he was paid. Moreover, it now
transpires that he was paid in precisely the manner Mr Al-Fayed
claimed he was paid - in face to face meetings with Al-Fayed
and in cash (Smith submission pp 3/4) The sums were rather larger
than anyone had so far accused him of taking. Mr Al-Fayed, as
we have remarked before, does not have a head for detail, but
nor, it appears, does he habitually exaggerate the truth. The
Inquiry will recall that Mr Al-Fayed initially accused Mr Hamilton
of staying at the Ritz for three days. It was Mr Hamilton who
corrected him and confessed to staying six days.
Taking the money in cash would, of course,
be an elementary precaution. Cash is always deniable. Mr Smith
initially denied it, and Mr Hamilton and Mr Greer persist in
denying it. Hamilton knew that if it ever came to the crunch,
it would be the word of a British MP against the word of (as Hamilton
may have seen it) an excitable and voluble Egyptian who (Mr Hamilton
may have taken an early view) might never be the most consistent
witness.
Having taken that view of the inherent unproveability
of cash transactions, Mr Hamilton has never deviated. He has
shown remarkable brazenness in sticking to his line. "Al-Fayed
is a liar. Al-Fayed is a liar". If he can repeat it often
enough (and he could scarcely repeat it more often during the
course of these 130-odd pages) then surely he will be off the
hook? Our task was, if we may say so, rather harder than
Mr Hamilton's. The English law of libel places the onus of proof
on the defendant - something, with his experience of libel, Mr
Hamilton also doubtless took into account. Anyone seeking to
expose his conduct at any stage in the future would have to contend
with this obstacle. As The Guardian's recent High Court experience
shows, there is no public interest defence available to a newspaper
in this country. (Happily, our reporting in that case was as solid
as our reporting in this case).
(3) Mr Hamilton's unwise challenge Mr
Hamilton makes a foolhardy invitation to the inquiry when he asks
(paragraph 28): "The inquiry has
to answer a simple question - Who is lying? Fayed or Hamilton?"
We can only state that we have found neither Mr Hamilton
nor Mr Smith to be truthful witnesses. Had both men been truthful
and open with us from the start we would have formed an entirely
different view of this whole affair. But both men were not honest
with us. Both men lied. Mr Smith has since admitted the truthfulness
of The Guardian's (and therefore Mr Al-Fayed's story).
But Mr Hamilton finds it difficult to explain his dishonesty
with our reporters and with Peter Preston. So in his evidence
to this inquiry he has lied about his lies. Through subsequent
research and through reference to notes made contemporaneously
we can prove that Mr Hamilton is lying to the Parliamentary Commissioner.
Sir Gordon Downey may find it as objectionable as we did that
an elected representative should lie to him.
Similarly, the Deputy Prime Minister, Mr Heseltine
must surely find it objectionable that a man so willing to lie
to save his skin should remain an MP. The Cabinet Secretary and
- through him - the Prime Minister must deeply resent the lies
they were told by Mr Hamilton as he struggled to cling onto office.
A man who lies to the two most senior politicians in the land
is unworthy to hold public office. Those lies are incontrovertibly
proved.
Our earlier submission to the Inquiry detailed
the lies to The Guardian and Peter Preston. Let us remind
ourselves of the startling nature of the lie to Mr Heseltine,
the Cabinet Secretary, the Chief Whip and - through them - the
Prime Minister.
On 21 October 1994 Mr Hamilton's career hung
in the balance. He had been accused of gross dishonesty by a
national newspaper. He was refusing to resign and was desperate
to save his skin. According to the minute by the Cabinet Secretary,
Sir Robin Butler, evidently intended for the eyes of the Prime
Minister:
"I pointed out that the Chief Whip and
I had asked whether there was any other interest which he had
not declared or anything else of which he was aware which
could be of embarrassment to the Government and he said that
there was not. Nevertheless, I encouraged the President to put
this point to Mr Hamilton himself. The President has now done
so, and Mr Hamilton has given him an absolute assurance that he
had no financial relationship with Mr Greer, and the President
has accepted this." [Emphasis added] This assurance
to Mr Heseltine was, as we now know, a direct lie. It succeeded
in saving his job for a few more days. As instructive as the
lie itself is the way in which Mr Hamilton reacts to the exposure
of this lie.
His first line of defence is to point out
that this was a "fraught" telephone conversation. If
this were so, he would have had ample time in which subsequently
to consider his answer and to have contacted Sir Robin or Mr
Heseltine to correct or amplify his statement. He did not do so.
Indeed, he brazenly issued a statement two years later in
which he says:
"I responded I had not. It was my view
then, and now, that the receipt of two payments many years ago
did not constitute a financial relationship." This
is, of course, specious nonsense.
Firstly, despite blaming the "fraught"
nature of the conversation, he does not withdraw the remark. On
the contrary, he seeks to justify it. Secondly, it is clear from
the context of the minute that he is specifically being asked
about his past relationship with Fayed and Greer. To dismiss
it as "many years ago", and thus of no account, is
blatant dishonesty. Thirdly, he is breathtakingly cavalier about
the extent of the money he is concealing. Questioned on Newsnight,
he equated the sums of money (total: £10,000) with buying
two copies of The Guardian (total: 90p), demanding to
know whether buying a couple of issues of a newspaper meant he
had a financial relationship with the editor. For any MP to seek
publicly to trivialise the Register of Members' Interests in
such a juvenile manner - particularly in the wake of Lord Nolan's
report - is distasteful.
But never mind the lie to Mr Heseltine. The
above minute shows that Mr Hamilton has, in any case, already
told the Chief Whip and Sir Robin Butler (in person, not on the
end of a "fraught" telephone line) that there were
no other interests which he had not declared. (see minute
above).
Hamilton has now - after discovery - been forced
to admit to Sir Gordon Downey that there was at least £15,000
worth of interests which he had not declared.
By October 1994 there could be no possible confusion
in Mr Hamilton's mind about the need to declare "commission"
or "introductory" payments. In December 1989 he - along
with all other MPs - had received a note from the Registrar of
Members' Interests which said explicitly: "Single payments,
such as commissions received for introductions . . . should be
registered"
So - a full five years after that
warning - Mr Hamilton is here revealed as having knowingly
and deliberately told a direct lie to his Chief Whip and to the
Cabinet Secretary which was clearly intended for the ears of the
Prime Minister.
"The inquiry has to answer a simple
question - Who is lying? Fayed or Hamilton?"
Mr
Hamilton may come to regret posing the question in those terms.
For we know that Mr Hamilton, as an elected MP, deliberately
lied to the Prime Minister, the Deputy Prime Minster, the Cabinet
Secretary and the Chief Whip in order to save his skin.
The Inquiry also knows that Mr Al-Fayed's claims
about the other Minister of the Crown, Tim Smith, have turned
out to be demonstrably true. Mr Al-Fayed's only error was to underestimate
the sums he paid Smith rather than overestimate them.
That, we submit, should be the starting
point for Sir Gordon Downey.
MR HAMILTON'S DOSSIER
We have no intention of responding to every
one of Mr Hamilton's paragraphs. We believe the dossier to be
disorganised, repetitious, specious and dishonest. What follows
are simple observations pointing up some of the more obviously
misleading passages. If the Inquiry would like us to address any
specific points not addressed here we are happy to do so.
The general comment we would make
is that Mr Hamilton cannot come to grip with the case against
him as it now stands - i.e., as it has been described
in "Sleaze". His tactic is to set up the issue as a
simple test of the credibility of himself versus Fayed, and then
to vilify the latter, and to make copious criticisms of The
Guardian's early investigations (which he caricatures as
little more than an acceptance of Al-Fayed's word: see Peter
Preston's appendix, below) He does not begin to answer the
documented case against him as it now exists, based on his own
letters to and on behalf of Al-Fayed, his admitted acceptance
of payments in kind, his lack of disclosure to ministers and
to the Registrar, the nature of the payments he has received from
Greer and the lies he can be proven to have told about his relationship
to Al-Fayed and Greer over the past three years.
MR HAMILTON, THE GUARDIAN AND THIS INQUIRY
5-25 The document begins unpromisingly. There
is an introductory barrage of accusations, many of which are
repeated throughout the following 133 pages. It is instructive
to examine this opening section, not because it is tremendously
pertinent to the main charges, but because it does demonstrate
from the start the way Mr Hamilton habitually weaves together
minor evasions, dishonesties and conspiratorial fantasies to present
a picture which might otherwise seem to have a patina of plausibility
about it.
12-25 It is claimed The Guardian "refused
to cooperate with the Inquiry during October and November".
This was apparently so that the Inquiry would be delayed until
such a time as The Guardian had managed to complete a
book and film on the subject in order to prejudice the inquiry.
Sir Gordon knows this to be untrue. He knows
that, from the beginning of October 1995, there was never any
doubt that The Guardian was co-operating with his inquiry,
though we never sought to conceal our anxieties about the process
Mr Hamilton had chosen over the civil courts. Indeed, Sir Gordon
knows that from the outset we were keen for him or his counsel
to examine every one of the 40-odd files of documents accumulated
during the course of successfully defending the libel action.
That the inquiry has not proceeded faster is not due to some
imagined conspiracy by The Guardian but was due to a number
of factors. Among them:
(a) An unforeseen and unprecedented problem
concerning the privileged status of certain documents which took
some time - both on the Inquiry's part and on The Guardian's
part - to resolve.
(b) The Inquiry's initial reluctance to
inspect discovered documents in the possession of The Guardian's
lawyers. This attitude on the part of the inquiry meant that
as late as Monday 10 February 1997, there was still considerable
confusion amongst members of the Inquiry team as to the extent
and location of several key documents.
(c) The fact that The Guardian's
lawyers were simultaneously preparing for, and fighting, another
complicated libel trial in the High Court. The preparation of
this two-week case (on which £750,000 of costs and damages
potentially hinged) was additionally complicated (i) by the illness
of leading counsel, requiring a new team to be instructed and
briefed; and (ii) by a false start to the trial in early December.
It started again in January 1996 with the original counsel, who
required re-briefing. Geraldine Proudler of Olswang was doing
her best to supply the Inquiry with the material it required
(entirely, it should be emphasised, at the expense of The Guardian)
at the same time as fighting this trial.
Those are the reasons for any delay rather
than the elaborate fantasy embroidered by Mr Hamilton. The
Guardian has always pressed for the inquiry to proceed with
maximum possible haste. Mr Hamilton might well care to explain
why it took him until 28 November to hand over his material.
Mr Hamilton's complaints of prejudicial publicity
must be taken with something of a pinch of salt. From the moment
his libel case collapsed (which coincided with the reference to
Sir Gordon Downey) he and his wife paraded themselves in every
television studio and on every newspaper interviewer's couch in
order to protest his innocence and to blacken The Guardian's
name.
We can supply the inquiry with transcripts of
the many lies he publicly disseminated during this period. He
has also during the course of the Inquiry written several articles
in newspapers - both national and local-and magazines seeking
to poison the public mind against The Guardian and Mr Al-Fayed
and to persuade people of his innocence. Nor has Mr Greer been
idle. He, too, has been busy writing a book ever since withdrawing
his libel claims and is actively seeking a publisher.
We do not apologise for continuing to draw
public attention to Mr Hamilton. We do not consider him fit to
be an MP and we believe it is right that the public - especially
his constituents - should be fully acquainted with his background
of deception and dishonesty before a General Election.
That would seem to be a fundamental duty of any newspaper in
a democracy. The book, Sleaze, was our first attempt to coalesce
the whole story of the sort of inappropriate lobbying activities
- including those of Mr Hamilton, Mr Smith and others - which
gave rise to the Nolan Inquiry. Lord Nolan's report showed our
concerns to be amply justified.
Our book was, indeed, intended to influence
both the public and Sir Gordon Downey's inquiry. A copy of the
book was openly sent to Sir Gordon upon publication with an invitation
that he should read it and consider it as evidence against Mr
Hamilton and others. We have reason to think that the book has
assisted the Inquiry and Mr Pleming has, quite reasonably, questioned
us on its contents.
We think the Despatches film also contains material
which should have assisted the Inquiry. We certainly helped the
makers of this film by frankly answering any questions they posed
of us. We believe that Mr Fayed participated on similar terms.
We understand that Mr Hamilton was also asked to participate,
but declined. The Editor of The Guardian had no knowledge
of the contents of the film before the eve of its broadcast, January
15, which rather confounds any suggestion of orchestration. Since
the Inquiry has limited investigative resources of its own and
has repeatedly asked for evidence from The Guardian
we presume it finds serious journalistic endeavours of this sort
helpful rather than otherwise.
The history of this whole affair is hardly one
of a newspaper rushing into publication. The Guardian has
been working on this story intermittently since the summer of
1993. Publication of any material was delayed for more than a
year as a result of (a) the lies of Mr Smith and Mr Hamilton when
first interviewed in July 1993 and (b) the further lies of Mr
Hamilton in his letters to Peter Preston. Further dissemination
of the facts about Mr Hamilton were then prevented by the Members'
Interest Committee's ruling [which was not, in fact, well-founded
in law] that the matter was sub judice. The unease this
caused at the time has been shown to have been at least partially
explained by two recent reports on the background to that period
from the Committee on Standards and Privileges. The matter then
did in fact become sub judice due to the imminent court
case.
It would certainly be an odd state of affairs
if, having successfully defended a libel action, a newspaper were
yet again-three and a half years later - to be prevented from
writing about a subject in the public interest simply because
the defeated plaintiff sought another arena for the claims to
be examined. There is nothing in Erskine May or the Contempt
Act to prevent such publication. The public would surely find
it objectionable for an MP to seek indefinitely to prevent the
disclosure of his dishonest behaviour on spurious sub judice
grounds, especially when he is about to submit himself for re-election.
Mr Hamilton's claims (19-22) of a conspiracy
between The Guardian and two newspapers in Tatton which
are owned by The Guardian's parent company, Guardian Media
Group, are another fantasy. They are repeated in more lurid detail
on page 72 (231-234, 237). Almost every statement in these paragraphs
is fantasy. We invite the Inquiry to take evidence to this effect
from any editor or senior executive on the Wilmslow and Knutsford
Express Advertisers. We find it telling that Mr Hamilton has
spent much energy in threatening legal action against small newsagents
and booksellers in his constituency with a view to preventing
them learning about his dishonesties in the immediate period
before a General Election. We find such actions within a democratic
system disturbing.
26-30. The allegations Fayed makes against Smith
and Hamilton derived from his first-hand knowledge - it was at
his hand, or at his direction, that they received their cash.
It is false to assert that there is no documentary corrobation
- the documents evidencing what Hamilton did for Al-Fayed prove
conduct which would not have been pursued had Hamilton not been
paid. (To take just a few examples; his PQs and EDMs making allegations
of which he had no knowledge; his letters to Al-Fayed and the
Stock Exchange, 23 and 28 July 1987; his letter to ministers
of 21 November 1987, ibid, 28 January 1988, together with
the obsequious letter to Al-Fayed, ibid 29 July 1988; the "Hamilton
notepaper" letters, which were sent (not to Hurd, but to
Young and Clark) since we retrieved the original on discovery,
21-22 March 1989).
31-33. The Guardian has been very careful
not to rely on the word of Al-Fayed without strong corroboration,
but does not accept Hamilton's characterisation of the DTI report
or of the Betterman and Rider cases. It is our conclusion, from
careful research, that he himself lied (indeed, perjured himself
on oath) in the libel proceedings he brought and won against
the BBC in 1985. We believe that, if the Inquiry is to examine
the Bettermann case, then it should also examine Mr Hamilton's
probity in the BBC case. It is pertinent to Mr Hamilton's probity
in precisely the way he claims the Betterman case if pertinent
to Al-Fayed's probity.
We have not provided details of this, or
of other extraneous occasions on which we believe Hamilton has
lied. The issue is which man is lying in relation to Al-Fayed's
allegations of payments in cash and kind. The thrust of Al-Fayed's
allegations, if not the precise detail, has been consistent throughout
in relation to Smith and Hamilton and we know he has told the
truth, without embroidery, against Smith. Hamilton has lied in
dozens of demonstrable ways from the moment the allegations were
put to him.
CHAPTER 2
This entire chapter is devoted to nit-picking
the Fayed allegations relating to the payments. We have a few
general comments:
(1) The thrust of Fayed's story has been
consistent throughout. Hamilton was frequently paid, in cash
of £2-3,000 a time, for his services.
(2) Fayed habitually talks in broad brush-strokes
and had no command of, or interest in, detail. D J Freeman may
not have understood this (see our opening statement).
(3) The differences in recollection between
Al-Fayed and the three witnesses are what you would expect after
eight years. What is plain is that there has been no "putting
of heads together" to produce a perfectly consistent story,
and no exercise the object of which has been, as Hamilton alleges,
to "plug the gaps".
(4) The overwhelming impression from this
chapter is that it is culled from preparation for the cross-examination
of Al-Fayed. This makes it all the more crucial to examine the
matter over which Hamilton is totally silent, viz why he withdrew
his libel action rather than rely on cross-examination of Al-Fayed.
There are a few statements and assumptions in
this chapter which require particular comments, viz 58,
84-86: "The three cheques".
Al-Fayed was under the impression that the election
money was cadged from him by Greer on the pretext of paying the
lobbying MPs, notably Smith and Hamilton. There is some reason
to believe that he did use this excuse, at least for the £12,000:
why else would Al-Fayed pay him after he had given McAlpine £250,000
for the Conservative campaign? Greer lied to Ali to cadge the
£6,000 (one or two Tories in marginal seats) and was quite
capable of lying to Mohamed about money he was really going to
use for IGA purposes and not Al-Fayed's. The cheque for £13,333
is said to be a "special project" fee for a special
project which was never undertaken and for which no plans ever
came into existence. It was approximately two-thirds of the annual
"under the counter" payment that Greer had previously
been receiving in cash. Was it a pay-off, obtained by Greer by
invoice and VAT payment because of the Select Committee's recent
activity in challenging him over his payments to Grylls, and
the imminent Privileges Committee condemnation of John Browne?
We note that Greer met both Hamilton and Grylls, separately,
in the week before this invoice was rendered.
69 Here begins a constant theme: what was Al-Fayed
getting for all these payments? The answer is that he was hiring
an MP to act on his behalf. He was getting public support in parliament
against his enemy Lonrho. He was getting defamatory attacks on
Rowland, Lonrho and "The Observer" widely reported
in the press, because they were being made by Hamilton (and Smith)
under parliamentary privilege. He was getting pressure put on
the DTI not to investigate his House of Fraser take over; when
it did, Hamilton helped him get rid of Philip Heslop QC as an
inspector; when it reported adversely, Hamilton and co successfully
pressured Lord Young (a) to suppress the report for several years
and (b) not to refer it to the Monopolies and Mergers Commission.
His need for Hamilton ended in March of 1990, when the report
was finally published with the announcement that no action of
any sort would be taken against Al-Fayed. In short, Al-Fayed received
from Hamilton value for his money. 82 Hamilton has not in
fact produced all his financial records for the period 1985-92.
He was under a legal obligation to produce his tax returns, 1985-94
and did not honour that obligation.
71 The comparison is otiose. Smith was paid
£18,000 in bribes between (he says) 1987 and 1989. In this
period Hamilton gradually became the more aggressive of the two,
especially after Smith "retired hurt" from Rowland's
letter in January 1989. He was, as Al-Fayed says, the more demanding
and the more brazen: unlike Smith, apparently, he was making
no declarations to the Inland Revenue.
99 The Inquiry may find Appendix 3 helpful in
this respect. It shows a similar chart to the one Hamilton has
constructed, showing the relationship between the work undertaken
by Smith and the sums of money he admits taking. It is interesting
that we count nine meetings where Smith met Al-Fayed alone. Nine
times £2,000 equals £18,000 - precisely the sum Smith
admit to receiving from Al-Fayed.
101 This is a truly absurd point. Al-Fayed was
not desperate in the summer of 1987: the DTI enquiry at this
stage was going well for him. Subsequently, as the inspectors
became tougher and began accepting the evidence provided to them
by Lonrho, he became in dire need of political help. Hence all
the subsequent payments.
128 O'Sullivan may or may not have an accurate
recollection: Hamilton denied us the opportunity to cross-examine
him. His evidence is perfectly consistent with our interpretation
of Al-Fayed alleging that Hamilton solicited and/or received
payment on most if not all of the occasions they met alone.
134 We referred in our opening statement to
our lawyers' genuine perception that Al-Fayed was going out of
his way to protect employees who, they always believed, must have
known something about the payments. Their relevance only became
clear in late August 1996, when (the matter having gone to sleep
since June 1995) we analysed the telephone records taken by "Alison"
and "Iris". We note with interest how morally justified
Al-Fayed's initial concern to protect them has proved, given
the viciousness of Hamilton's attack on Alison Bozak's fitness
to be a solicitor (paragraphs 146-7).
154 "What was I doing in exchange for all
this money?"
Answer: a great deal of work which he would
not have done had he not received it.
"Why pay me when Campbell-Savours could
do the work for nothing?".
Answer: Because he was a powerless back-bench opposition
MP. Hamilton was a member of the governing party, on his way
into the Government, a vice-chairman of the vital Trade and Industry
Committee and secretary of the Conservative Finance Committee,
his appointment to which, as he fawningly reminded Mohamed on
23 July 1987, will give him much more clout to advance his
interests.
154 (i) "Why was Hordern not used to put
down written PQs?"
Answer: Why indeed? Greer canvassed this
with him, he declined. He was always scrupulously careful to do
nothing on the floor of the House to help Al-Fayed. Since he
registered his interests, unlike Hamilton, his principled reticence
in this respect is difficult to explain. Perhaps it avoided people
asking how much he was being paid by the House of Fraser, and
perhaps it gave him more credit with Channon and Young when he
introduced Hamilton and Smith and Grylls as concerned member
of the Trade and Industry Committee.
(ii) "Why pay Hamilton vastly more than
Hordern?" Answer: Why indeed? Hamilton was not paid vastly
more than Hordern: he was on a very nice little earner
of £24,000 per annum - a sum which even now he finds difficult
to admit. Over the three years Hamilton was "active"
in Al-Fayed's services, Horden earned £72,000. Hamilton must
have made the equivalent (given the fact that - we believe -
he either did not declare your payments and rewards to the Inland
Revenue or managed to claim them as tax-free "ex-gratia"
payments).
156 See 134 above
CHAPTER 3
179 The PQ was a most effective way to achieve
Al-Fayed's objective of striking back at Lonrho, with defamatory
statements made by "his" MPs under parliamentary privilege.
Just look at Kenneth Fleet's report in The Times of Hamilton's
first PQs, 8 November 1985. In 1994, The Sunday Times found
MPs prepared to accept £1,000 for tabling one PQ.
180 In all the hundreds of pages of documentation.
We are, aware of only one occasion on which Hamilton refused
to do Greer/Al-Fayed's bidding. That was because Eddie Shah, of
"Today", was his constituent and supporter.
But note the cryptic way in which he replies (19 August 1986)
with a secret message sent to Al-Fayed through a Greer employee.
187-193 At this point Hamilton develops his
new theory that he was never asked about cash by Hencke and Mullin
at the Terrace meeting, hence Al-Fayed never mentioned cash to
Preston in relation to Hamilton, but only in relation to Smith.
We dealt with this at the hearing. It is a lie (see separate section,
below). It might be interesting, for the inquiry to review closely
the Government documents disclosed on subpoena by the DTI - our
recollection of them is that immediately after this meeting, Hamilton
had his department search out all his references on record to
his past activity on behalf of Al-Fayed. He was clearly worried
about much more than the bill for the Ritz. And about what evidence
might exist of his work for Al-Fayed.
200-219 The Inquiry has had the opportunity
to assess Peter Preston at the hearing. He makes his own observations
below (Separate Appendix).
220 Hamilton is ingenuous. The documentation
we had at this stage helped to corroborate Al-Fayed. The letters
of 21/22 March are damning, and we retrieved originals sent not
apparently to Hurd, but to Clark and Young. The relationship
between Hamilton's office and Greer's office was intimate - see
the plaintiffs own witness from IGA who confirms that Christine
Hamilton supplied IGA with the MP's letter-headed paper. What
we are looking at, of course, is not an isolated incident but
a pattern of conduct extending over three years.
What is truly remarkable about the Al-Fayed/Greer/Hamilton
axis is that this MP was prepared to sign letters and table motions
which made defamatory - often criminal - allegations against Lonrho
and Rowland. There is no evidence that he ever satisfied himself
of their truth but merely reproduced or parroted the allegations
made by the Fayed camp because - we say the inference is inescapable
- he had received and/or was expecting to benefit personally
from doing so. Hamilton goes on to say that the documents are
"neutral". We can supply you with a copy of Geoffrey
Robertson's draft opening, which sets out our interpretation of
them.
221-222 Peter Preston dealt with Hamilton's
allegations about the "Rough Draft" at the hearing.
Hamilton attributes it to Hencke and misunderstands its date
and purpose.
227-228 "The Guardian" had
put its allegations to Hamilton orally; it had then received and
carefully considered a three page dishonest written response.
230-237 See our response in comments re Chapter
1.
CHAPTER 5
238 The "intermediary" was in fact
Lord Lester of Herne Hill.
259 We know of no suggestion that Al-Fayed ever
asked Hamilton to do anything for him after March 1990. The notion
that Brian Hitchen is, in the circumstances, a reliable witness
to Al-Fayed's motives is one that we find (to use Hamilton's
favourite term) risible.
274-291 From recollection, we do not think that
these documents show that Hamilton acted scrupulously. Quite
the contrary. He did nothing to declare his previous interests
and rule himself out until his own officials expressed concern
about Al-Fayed's letter (30 April 1992). He still did nothing,
and improperly answered a parliamentary question on 13 May 1992,
knowing that it was wrong for him to address the House on Al-Fayed
without declaring an interest.
His excuses at para 279 are not acceptable:
no MP may breach parliamentary rules because he thinks it "pointless"
to comply. It was not until June that he "came clean"
- because his staff already knew of his difficulty about the
ECHR case, and it was Dr Bell (we are relying upon recollection)
who first raised with him the ambit of the "presentational
problem" posed by his past intimate involvement with the
Al-Fayed camp. We had thought it was her initiative which led
him to stand down from Lonrho-related decisions.
291 We are amused that Hamilton should make
a virtue of his incuriosity about the DTI inspection report.
There would have been nothing improper in him looking at papers
relating to the HoF. The fact, surely, is that he never had any
real interest in the matter, other than for the material benefits
he received from arguing the cause. He omits to mention the fact
that immediately after the Terrace interview in June 1995, he
had his officials scour the entire department to find out what
evidence it held against him.
We find no reference in this section, or
at all, to justify Hamilton's behaviour in helping Greer to obtain
the "Big 8" contract, worth a fortune. His conduct
in providing Greer with a secret opinion, pledging his support
for the Big 8, which he knew Greer would use to win the contract,
was disgraceful. His failure even to mention this much-publicised
allegation is telling.
292-294 (At this point the submission runs out
of paragraph numbers, so ..... )
Pages 87-107 This
is all repetition of allegations made against Fayed earlier in
Hamilton's submission. They all beg the question of why he was
not prepared to put them to Al-Fayed in the witness box. (see
page 102 "it was only as the full horror dawned upon Fayed
that he would be subject to vigorous cross-examination in court
..... ").
We note that the stepped-up vilification of
Bond ("my guess is that she will have been paid handsomely
for agreeing to commit perjury", page 105) and Bozak ("entering
the ranks of bent solicitors", page 106) justifies Al-Fayed's
initial protectiveness towards the witnesses.
Pages 108-133 This is almost all repetition
of points that could have been put to Al-Fayed, Hencke and Preston
in cross-examination. If they do lead, as Hamilton contends, to
the conclusion that they are liars and he is innocent, why did
he back down at the door of the court?
May we be permitted
to venture a comment on Hamilton's psychological state, as it
emerges throughout this submission? He is locked in a time-warp.
He is obsessed with the state of his libel case as it existed
in mid 1995. He believed, and may have been advised, that on
the then state of the pleadings and witness statements, he would
be sure to win. That would explain why he and Greer moved mountains
to amend Article 9 of the Bill of Rights after the case was stayed.
He cannot focus on the mass of new material
which came to light, or was first analysed, when the case re-started
in August 1996 and we frenetically prepared for the trial. He
cannot deal with this evidence - his letters, the telephone records,
Greer's accounts, the documents disclosed by the Government. All
he can do is vilify, quite recklessly, the new witnesses, and
return - obsessively and anachronistically and repeatedly - to
Al-Fayed's character and to his complaints about the way The
Guardian behaved in 1994.
We might add that The Guardian was advised
from the outset that we had an overwhelming argument for staying
this case, on the authority of the Privy Council decision in Pebble
v TVNZ (see our original defence). We naturally, therefore, did
not expend too much time and money on preparing for a trial we
believed would never happen. So Hamilton was lulled into a sense
of false security. The trial he believed he would win was not
the trial he and his legal advisers faced on 1 October 1996.
Over the previous two months, The Guardian
had five lawyers, five journalists and two accountants working
full-time on the case, producing and requisitioning the evidence
necessary to justify the story at trial. It therefore makes no
sense for Hamilton to expend most of his submission biliously
reviewing the events of 1994 and 1995, other than as a diversion
to obscure his inability to explain the evidence which has emerged
in the past six months.
Let us give just one example: the letters he
wrote to Al-Fayed and the Stock Exchange, dated 23 July 1987 -
about the time he received cash (there was a private meeting/payment
on 8 July) a few days before he lobbied Lord Young without disclosing
his interests, and a few weeks before his holiday at the Ritz.
How does he explain his language to Al-Fayed
("gives me a better position to act on your behalf")
and his opening line to Sir Nicholas Goodison ("As vice-chairman
of the Conservative Trade and Industry Committee, I have taken
a close interest in . . . the House of Fraser")? This
dishonest man is abusing his privilege as an MP, writing to a
regulatory body on behalf of Al-Fayed, but disguising his retainer
by pretending that he is acting on behalf of the Trade and Industry
Committee, or at least because he is vice-chairman of that committee.
This is just one of the damning pieces of evidence that Hamilton
cannot bring himself to face, in 133 pages of submission.
We
note at page 111 his protestation that "the amount of work
was not great. It amounted in all to a few hours a year."
This is obviously untrue, in terms of all the meetings attended,
lunches eaten and letters written. But what does it say about
an MP who makes serious allegations of complicated crime without
doing any research into the evidence? Of an MP who writes to
DTI ministers claiming to have studied long submissions? He did
no real work, because he did not really care, passionately or
at all, about the private problems of Al-Fayed. He cared about
the cash and rewards he received to promote his cause.
Page 127 Hamilton does not address the untruthful
Preston letter which he sent in October 1993 and which is another
of his problems in seeking to convince any tribunal of his probity.
Hamilton attempts to deal with this problem by saying it contained
"innocent errors committed in haste". His flat lie in
it about the circumstances of meeting Fayed - that it had nothing
to do with Greer - he excuses by saying: "It is hardly surprising
that I could not remember exactly when IGA were engaged".
However his problem remains. More than a year later, on 17 October
1994, after a week in which he was warned and forearmed, Hamilton
handed over this very letter to the Cabinet Secretary, maintaining
that it was the truth. As we recall the subpoenaed Downing Street
documents, Sir Robin Butler subsequently relied on this letter
in reporting to the Prime Minister. This time the errors could
not easily have been "innocent" or "in haste".
PAGES 125-133: MR HAMILTON'S ENDGAME
The inquiry has to answer a simple question
- Who is lying? Neil Hamilton - or Peter Preston, Paul Johnson,
David Hencke and John Mullin?
It appears to be critical
to Mr Hamilton's defence to pretend that the allegations that
he received cash from Mr Al-Fayed were never put to him by The
Guardian.
Mr Hamilton first raises this in pages 60-63
as evidence that either Fayed had never made the allegation to
Peter Preston before publication, or that Mr Preston did not
believe him.
Peter Preston says of this claim:
"Mr Al-Fayed mentioned the cash payments
at our first meeting in June: they obviously caught my interest
then and were prime factors in my briefing to the Home News Editor,
Paul Johnson, who detached Hencke and Mullin from their other
duties to work on the case. Mr Johnson tells me he remembers
the briefing vividly and would say so to you in writing or in
person if so needed.
Mr Hencke and Mr Mullin knew the key aspects
of the story they were pursuing. There is not a shadow of doubt
in my mind that the allegations were put squarely to Mr Hamilton."
On page 125 Mr Hamilton notes that Mr Mullin and Mr Hencke
challenged Mr Smith about "£2,000 cash in a brown envelope"
and states: "He [Hencke] certainly never put such a question
to me."
He raises it again on page 71 (226). On page
126 he writes:
"I categorically deny that Hencke or Mullin
put to me any allegation of receiving cash from Greer or Fayed
for PQs, still less that the figure of £2,000 a time was
mentioned. The first I heard of this allegation was when I read
it in The Guardian on 20 October 1994."
On page
130 he again denies it (paragraphs 4 and 7). On page 131, paragraph
25, he returns to the theme, accusing David Hencke of a "direct
lie" when he says he put the allegation of taking cash to
Hamilton on July 12 1993.
We refer you to four separate sets of notes
and affidavits from John Mullin and David Hencke concerning the
interview they had with Mr Hamilton in July 1993.
(1) Mr Mullin's shorthand note (Exhibit A)[21]
made immediately after leaving Mr Hamilton. We refer you in particular
to the last paragraph. Mr Mullin has transcribed his note for
your benefit. It reads: "Never received any payment other
than those declared in the Register of Members' Interests".
(2) Mr Mullin's note written on the computer
on his return to the office (Exhibit B). We refer you to the
question to Mr Smith on the first page:
Q: "£2,000 inb (sic) a brown envelope?"
"That's certainly not true" We
refer you to the next page where the same phrase is used in questioning
Mr Hamilton:
Asked about the brown paper bag, he was by this
stagd (sic) somewhat agitated and began his increasing level
of threats about Peter Carter Ruck: "I'm a man who sees it
through . . . etc." (3) Mr Mullin's affidavit (Exhibit
C) reads:
18 We then went on the record, and I asked Mr
Hamilton formally about the allegation that he had accepted payments
from Mohamed Al-Fayed, and that these consisted of £2,000
per question, paid in cash. He denied that this was the case.
. .By this stage he was visibly agitated. He mentioned Peter
Carter Ruck and Partners, and said; "I am a man who sees
things through" which I understood to be a threat to bring
libel proceedings¾ (4) Mr Hencke's affidavit (Exhibit
D) reads:
8 We then confronted [Mr Hamilton] with the
cash for questions allegation. Either John or I asked directly
asked him: "Have you received any cash from Mohamed Al-Fayed
in return for asking questions in the House on his behalf?"
I also recollect that we mentioned the figure of £2,000 per
question asked. Neil Hamilton denied the allegation. He said
that he had never received any payment from Mohamed Al-Fayed
or anyone else other than those declared in the Register of Interests.
He asked whether we had any documents and I replied that we did
not. He had become quite angry by this stage and stormed off.
The Inquiry therefore has another direct conflict
of evidence. If Mr Hamilton is right, then two senior reporters
on The Guardian not only lied in their affidavits on which
they knew they would be cross-examined, they also constructed
fake notes immediately after seeing Hamilton and Smith.
If you choose to believe the word and notes
of Mr Hencke and Mr Mullin - who are both as prepared to testify
on oath to the Inquiry as they were to a court of law - then it
follows that Mr Hamilton has perjured himself to the Inquiry.
MR HAMILTON'S EXPLANATION OF COMMISSION PAYMENTS
NNC in general: see our earlier submission.
We remind the Inquiry of our view that we consider it is inappropriate
for MPs to accept extra money, whether declared or undeclared,
for acting on behalf of their own constituents. UST.
page 32. paragraph 6. see our earlier submission, with the
quotation from the C4 Despatches programme where John Walter,
the UK Corporate Affairs Director of US Tobacco says on the record
that Greer was not introduced to the company by Hamilton:
Walter: "The company selected IGA
themselves".
Q: ". . . not on an introduction from
Neil Hamilton?"
Walter: "Correct. As I say, we put
together a shortlist . . ."
This directly contradicts
Mr Hamilton's account.
On Commission payments to UST, we are now able
to disprove Hamilton's repeated claim that he did no Parliamentary
work in return. Greer acquired UST as a £120,000 client by
the end of April 1988 (the contract was formally signed to date
from 1 May).
One of the first things he did was offer to
buy Hamilton some pictures (Hamilton made the purchase 29 April
1988). Hamilton immediately afterwards agreed to present himself
as one of a Parliamentary delegation to Edwina Currie: the delegation
went to see her on 12 May 1988, a few days later. The watercolours
seem to represent a specific bribe for Hamilton to help out Greer
on a particular occasion. This is similar to the episode a couple
of months later with the garden furniture - upon receipt of which,
Hamilton tabled a motion for Greer, in support of Fayed.
Page 32 paragraphs 8-9 - page 33 paragraphs
1-2 Mr Hamilton should be cross examined on this accountant's
note, which he submits as evidence that he was advised he need
not pay tax on the "commissions".
First: when did he seek the advice? He says
(page 32, paragraph 9) that this conversation took place in the
summer of 1988. By the top of page 33 the date has changed to
24 July 1989.
The date is pertinent. The note of the telephone
conversation in fact serves to further incriminate, not exonerate
him.
On 26 June 1989 Andrew Roth, the journalist
and author Parliamentary Profiles, told Michael Grylls he had
found out about Greer's payments to MPs. Confronted by this revelation,
the conspirators took three steps to cover their backs:
(i) Greer wrote Hamilton a cheque on 13
July 1989 for the alleged balance of £10,000 owing to him.
(ii) A few days later - on 24 July 1989
- Hamilton contacted his accountant and asked if he could claim
the "gifts and cash" from Greer were non-taxable, "ex-gratia
payments". His accountant appears to have said he was not
at all hopeful, but that it was worth trying.
(iii) Hamilton concocted two invoices,
both dated 1 August 1989, purporting to relate to commission
payments from NNC and UST respectively, and supplied copies to
Greer.
There were thus no proper receipts, invoices
or declarations until long after the event, and only when Hamilton
and Greer realised they had been needed to cover their tracks.
Though Mr Hamilton, a tax specialist, quotes
case law which he claims frees him from the necessity of paying
tax the note actually quotes its author (KW) as follows: "KW
said not at all hopeful". There is also the sentence
"worth a try". These phrases fall rather short
of the erudite case law cited by Mr Hamilton, a tax barrister.
Are they, in fact, the fruits of Mr Hamilton's researches, or
was it the advice given by his accountants?
The note ends
with the advice that the sums should be declared as ex gratia
payments. Mr Hamilton nowhere states that the sums were in fact
declared to the Revenue. His tax returns were never disclosed
to the Guardian, as ordered by the High Court.
Page 34 paragraph 6 Mr Hamilton's attempts
to explain his non-registration grow ever more weaselly. He appears
to have forgotten his statement to Sir Geoffrey Johnson Smith,
dated 12 December 1993, in which Mr Hamilton explicitly acknowledged
that, in areas of any doubt, it was up to MPs to seek clarification:
"The onus is on the Member, in the
first instance, to determine what properly ought to be declared
. . . " [emphasis added]
Then, Mr Hamilton was
happy to accept that, where there was confusion it was up to MPs
to seek guidance. Now he merely complains that the position
was ambiguous, and pleads to be allowed the benefit of hindsight.
These two statements are incompatible.
He now asks for clemency on eight grounds:
(1) There was no agreement.
Maybe not, but see immediate pattern of behaviour
(above) once contract with IGA signed for UST.
(2) The payer had no expectation of any
return.
Ian Greer - and possibly UST if it was not,
as we contend, an "introductory payment - certainly would
have had an expectation of Mr Hamilton continuing to act in a
manner helpful to UST and NNC. See dates and pattern of behaviour
once contract with IGA signed with UST (above)
(3) It was normal practice in the industry.
Andrew Gifford, as he would have testified,
would have said it was not normal practice so far as MPs were
concerned. The Public Relations Consultants Association says
in its code of conduct, submitted to the Nolan Inquiry (page
508):
[Members should not] ªoffer, nor give,
nor cause a client or associate to give, any inducement to any
MP . . . with intent to further their interests of any client."
In his oral evidence to Nolan (page 89) Mr Gifford said:
"I would not expect [to make] any payment
beyond the normal course of entertainment." He goes
on to quote the Code of Conduct of the Association of Professional
Political Consultants (Nolan, page 90)
"Save for entertainment and token business
mementoes, not to offer, give or cause a client to give any financial
incentive or other incentives to a representative or employee
of Parliament".
Again, Nolan page 91 446: Martin Jacomb:
So it is absolutely categoric that your members do not pay MPs?
Andrew Gifford: Absolutely categoric.
Mr Hamilton has not provided any evidence that
it was normal practice in the industry to pay MPs any kind of
fees. The only lobbyist known to do so was Ian Greer.
(4) The nexus of the payments was the new
business, not the fact Hamilton was an MP.
We do not accept it was an introductory payment.
We believe (see above) it was directly linked to the pattern
of his behaviour as an MP. In any event, it is incredible to claim
that any of this would have happened had he not been an MP.
(5) There was no attempt at concealment.
Simply not true. He was given the opportunity
of telling Sir Robin Butler, the Chief Whip and the Deputy Prime
Minister about these payments. Not only was he not open about
them, he lied about them. He did conceal them.
The
Inquiry will note Mr Hamilton's coy phraseology. He declared the
receipts to his accountants "who prepare my tax returns
or for the purpose of advising me on the tax implications."
He stops short of saying that he did declare them on his tax
returns (which were never supplied for the court action). Since
his accountant's note ends: "Declare as ex gratia payment"
it would be interesting to see whether Mr Hamilton did declare
them as advised. If he did not, his statement at 5 is even more
dishonest.
(6) There's no evidence his behaviour as
MP was affected by receipt of money See note on dates above,
and Sleaze, passim.
(7/8) There may have been no requirement
to register, in any case.
Mr Hamilton's selective quotations neglect
to quote the letter sent to every MP in December 1989, in which
the Registrar of Members Interests warned:
"I have received a number of inquiries
recently about commission payments. The rules do not differentiate
between single and continuing payments . . . Single payments
such as commissions received for introductions . . . should be
registered . . . where such payments relate in any way to
membership of the House" [emphasis added]
In any event, we submit that, for all
Mr Hamilton's sophistry, the ordinary man would have little problem
understanding the situation ever since 1975:
"to provide information of any pecuniary
interest or other material benefit which a member may receive
which might be thought to affect his conduct as a member or influence
his actions, speeches or votes in Parliament"
His
claim that the later addition of the words "reasonably"
or "by others" in any way helps his position is desperate
stuff. It is, anyway, not consistent with his admission to Sir
Geoffrey Johnson Smith that it was not what "others"
thought, but what the MP himself thought that should matter.
If Messrs Clark, Mellor and Currie knew of the timing
(above) it is, we submit inconceivable that they would not think
that the large fee Mr Hamilton had just received was affecting
his conduct.
20 See Appendix 33 (the page references in Appendix
29 relate to the original document forming Appendix 33). Back
21
Not printed. Back
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